All right. Good afternoon, everyone. Day 2, Citi's Global TMT Conference. Asiya Merchant here. I lead tech hardware, tech supply chain researcher at Citi. Really pleased to have Terrence Curtin with us. He's CEO of TE Connectivity. There's a lot of questions here. I'm going to kick it off. Please come in, there's a bunch of seats in the front here. I'm going to kick it off. It's a fireside, it's interactive. I'm going to leave a few minutes here for folks to ask some questions. Please do raise your hand if you have interest in asking, and we will bring the mic to you. Welcome. Thank you, Terrence.
Thank you.
All right. Let's just start with maybe just the most recent reported quarter. I know September's going to be ending here very shortly too, but you guys just had a very, very strong fiscal 3Q. Sales were up 14%, 12% organically, year-over-year. You had record orders. Your EPS is growing much faster. Your margins are expanding. You are across a broad variety of end markets. It's not just AI, it's not just end, but there's a whole bunch of end markets that you're. As you think today, and with the quarter that's just been reported, relative to your true cycle framework that you've shared, 6%-8%, where are some of the demand drivers that are sustainable as you think about that demand?
Thank you for the question, and also thank you all for being here. I'll get to your question, I promise. First off is I think what's important is when you think about what TE does, we very much focus on where does data need connectivity, as well as when you need compute and data, you also need power. It's areas that I think drive the growth that I'll talk about. One of the things that we've been very focused on at TE is how do we continue to broaden our growth profile. It was a big part of what we teed up at Investor Day. Like you said, Asiya, there's a lot of it that I'm sure we'll have questions around AI and our momentum and our DDN business that has had tremendous growth.
But I also think when you look at what we're experiencing right now is across our industrial businesses, anything that's CapEx exposed is really driving growth, and faster than we would've even expected when we talked earlier in the year. Certainly on the data side, what we see happening, and you've seen a lot of companies here today talk about everything that has to happen around AI and also the hardware around it. We're no different than that. Our DDN orders are up 70%, and while we grew $1 billion this year, that really sets up a very strong backlog for next year with the partnerships we have with our hyperscale customers. But it's just not what's happening in data.
In our industrial segment, what we're seeing with where we serve connections from an energy infrastructure, which are driven around power, we're seeing double-digit orders there, where you have a market that used to grow 1% or 2%, now it's probably growing three - four times what it used to, and we've really capitalized to make sure we can grow double digits in that business. Then you have those secular areas that we benefit from, like aerospace and defense, going to grow double digits due to everything happening there, as well as a general industrial uptick that we've seen around the world. This is where we would play with factory automation, where you need connectivity that brings that data out to get to the intelligence to be processed through the LLMs. When you think about our industrial segment, we're going to grow about $2.5 billion this year.
About 80% of our growth is in that segment, and it's very broad. Then in the transportation area, that's an area that we're sort of driving content growth in a flat market. There are areas that are also around data and power. Self-driving cars, software-defined vehicles, also an electric vehicle, which in Asia is very strong, and we're strong. When you think about that framework, which we're growing about twice it-
Right
We see that momentum are going to continue, and it all starts around data and power. Certainly the CapEx elements of where we play, we just see that motoring along and orders up very strong to record backlog as we enter into our 2027. There's no reason to say that's going to slow down as we go into 2028 when you think about all that's happening on the data side and the power side.
Okay. Before we get into each of the segments, EPS is growing faster than revenue. So what's driving that? Not only do you have top-line growth, but you also have nice margin leverage.
Totally.
What's the algo there? Is it pricing? Pricing is higher, or is it other sorts of leverage that you're experiencing that's driving EPS to be faster?
Yeah. On our strong growth this year, which will be mid-teens, probably a point or two is pricing where we're actually managing through inflationary effects, where we're actually getting recovery across the portfolio. So pricing is really a cost recovery tool right now. The rest of it's around volume leverage on what we've done to make the portfolio healthy as well as our footprint healthy. So it's really good operating conversion.
But the other thing that I just want to highlight is we're investing significantly back into the business, especially to those areas that have really strong growth. We're adding engineering in our DDN business. We've added factories in our DDN business. We're adding capacity. So we're driving that earnings leverage to really good conversion on the volume while also making investments for the future to make sure we capitalize on that growth ahead of us. So I feel the levers, how the team's operating is very strong. Certainly our cash element, we have a very strong cash generation model. We've done some acquisitions as well as returning capital also helps the EPS line as well.
All right. Okay. Well, maybe we can just dig into each of the segments, right? I will start with AI DDN, or DDN just because it is top of mind here. It is a technology conference. DDN sales up in the 30s, orders obviously significantly higher. You guys did have a target, $3 billion in cloud and AI that you shared at your Analyst Event . You talked about that target continues to shift left, meaning it is being achieved much faster. So when you think about your size now of that DDN, AI DDN, cloud and AI, sorry, cloud and AI segment, and the growth trajectory that one should expect, just given hyperscaler CapEx and that just continued rise.
Totally.
Yeah.
So first off, our orders this year with our DDN business, which is where that is housed, is up 70%. So got a couple great questions today. Terrence, how do you grow 30-ish percent, but your orders are up 70%?
Right.
Those orders are really for 2027 is right upon us. So they are programs that we have won, certainly with our hyperscaler customers around the copper connectivity that we do for them to really get their infrastructure up on their GPU networks. That is going to be, sets up really strong growth for 2027. As you said, any target we gave out just nine months ago related to AI, we have been ahead of that, and that $3 billion shifted in, and that is going to continue to shift to the left. But feel very good about the momentum there, and our position is very strong with our hyperscale customers.
Beyond 2027, does the orders look like we are seeing demand very, very strong. I have some component players who were talking about HTDs that are talking about demand further out, just given the supply tightness. So how does it filter to the connector side, on your side? Are you seeing orders maybe stretch out beyond just one fiscal year?
We're typically into 2027.
Yeah
We don't have that supply tightness.
Right
Some of your other people that you cover do. Really when we're looking at it, we'll probably start seeing 2028 orders, but coming early into 2027 when we will see it. I think the real element that we get excited about as you go into 2028 is the engineering activity we have with our customers today on next-generation architecture.
Right.
One of the things that's important is our customers are going to pick a semiconductor. They're going to pick a power supply. Then you go work the connectivity. What's really nice about where we lean in is with our engineers, with our customers, those next gens are being worked on already.
The orders we have today are for things that we have to take into production next year. The engagements that we have about what's the next-generation architecture, who's looking at 800V, who's looking at liquid cooling versus air cooling, where does optics come in the rack over time? All of those discussions are happening real time. What gets us excited is that the momentum's going to continue in 2029.
Okay. Talking about optics, that's obviously a big debate, right?
Totally.
You guys have talked about it. You were like, "It's not just copper or optics. It's going to be copper and optics that are going to continue." Just as you're sitting here, you're looking at all the workloads, you're looking at all the AI architectures. They're changing, right? At OCP Asia, there was a lot of chatter about what's changing, what's not changing. You have scale up, scale out, CPO, NPO. When you look at your content opportunity, in fiscal 2026, increasing in fiscal 2027, just help investors think about as you go into fiscal 2028 and 2029, what are you looking at from a content opportunity?
A couple things first, and I appreciate you said it. It's going to be copper and optics, and it was great at the launch today. The Marvell CEO actually said that as well.
Okay.
You hear that a lot. I do assure it is not a versus because we are really looking at architecture being maximized, and copper is going to play a role. Anything in the power architecture is always going to be copper-based. Even if you go to agentic where you bring CPUs in, you are going to have much more CPU, that is going to be copper-based. Where we play, certainly we play in the scale up. We do not play as much in the scale out. In the scale up, we do look at where you will have NPO and CPO coming in more at the switch level is where you are going to first see it.
There is a lot of scaling that has to happen there when we look at the architecture we are working on with our customers. We have solutions that can actually play in that space that I am pleased with our customer engagement on, that would help enable that. That is an increased TAM that we would have versus our copper portfolio. We view copper is going to continue to grow over this period. Certainly, the architectures, as you said, they are very customized. They are changing a lot as people are trying to optimize different parts of the workload. Copper is going to be a key part of it, but what we get excited about is where we can introduce basically a fiber attach unit, which is essentially, we would view it as a fiber connector that would actually help enable CPO or NPO as that comes in.
Right. There is just a lot of activity going on in that FAU side of-
Oh
Just to make it scale, right? Because up to-
Totally
this point, they haven't had to scale. Just as you think about that space evolving, what are some milestones that investors should keep in mind to say, "Okay, now this is starting to gain momentum and can scale to the level." Obviously it's not fiscal 2027, but into 2028, 2029. You kind of see some of those-
Certainly it starts with our customer's architecture.
Okay.
They have to hit their intercept points. Secondly, our customer engagement, and where are they seeing it, and certainly that's where we're focused on right now. Our engineering engagement on that intercept point, hitting engineering qualification, and then like everything in the optic space, how's it scaled to the needs that the units that our AI customers want us to have and our hyperscale customers. I think they're going to be the things we're looking at the roadmap. Certainly we're investing ahead.
We made a $200 million acquisition earlier this year to help buffer the portfolio there, and we'll keep investors apprised of our progress as we go through.
All right. Then you talked a little bit about power. One third within the DDN AI space is power, right?
Yeah.
The rest is data connectivity. Obviously there's a lot happening over there. You're talking about 400V, 800V architectures. Help us understand as those transitions are happening, again, what's the content opportunity growth that you guys are seeing? What should we be looking out for to say, "Yes, this is happening," and an inflection perhaps for TE Connectivity?
The one thing you have to realize is not everybody's going to move to one voltage architecture. Back to the customization, what's really great is as you bring in these sidecars, that brings in a whole different architecture where connectivity even becomes more powerful. It's also you're bringing in a lot of different voltages into the rack that actually have very different material science, also have different electromechanical interference elements to them. All of those are things that we excel in. As our customers are experimenting with that we have such a large portfolio of power products to begin with, it's very essential that as we move through that journey with our customers, some will not go full 100V - 800V, but that will create increased content just due to the connectivity in there. Also, as you move to optics, you're going to need more power in the rack.
When you think through the AI discussion, a lot of our discussion with TE is around the data side. I actually think the discussion needs to be as much about the power side, because all of those inflection points create engineering trade-offs that our engineers do great with our customers as they're figuring out the architectures and constraints they're working through. What that will create is an increased inflection point on the content.
It won't be cookie cutter by rack, but it will be something that will increase revenue content for us as we move to that, I think.
Okay. Then just stepping away from it, where is TE's moat when you think about all these changes, whether it's on the power side or on the optics coming into the rack? Where would you say is TE's moat, and why you think that content continues to stay with TE, potentially even expand while you guys are providing the solution?
I think when you look at connector manufacturers, there's four moats, four pieces to our moat. The first one is we need to be engineering close with our customers. Connector business is not we design a connector and bring it to a customer, and you just pick it off the shelf. That's not what a connector manufacturer does. It is they're trying to work right at the design center with our customers, and it's a very engineering intense business, and we're part of that architectural design. It's why when you look at connector manufacturers, we all don't play in the same markets. Now, building up engineering at all the design centers around the world is hard. It's a significant investment in different markets, and you typically see us play in certain markets. The second thing is we need to be deep into technology.
Whether it is AI and you are dealing with 448 gigabits speeds and signal integrity or voltages going up to rates with 448, you need to actually understand that architecture to get deep, and you could hold that true into an AI domain. You could say it could be utility infrastructure where we are doing power connections or even into a car. The third element is you need to basically have the science expertise that comes with it. Some cases, we are dealing with space, we are dealing with different materials because we are in a different applications than you would have on Earth. The fourth one is we have to have the supply chain that executes at the rate, at the supply chain of our customers. It is not cookie cutter around where we make. We have to be very close to our customers.
If you take us and AI, we have added three new facilities in Southeast Asia to really make sure we support our China plus one over the past three years. We are adding more right now, and it needs to be able to execute at the pace our customers want, and it is something that continually evolves. The moat that you sit there, which each one by themselves might not say, well, is that that special? When you put them all together and the amount of SKUs that we cover for our customers from an execution perspective is very important from the design all the way through in an area where cycles just get tighter. In every one of our markets, our innovation cycles are tighter than they need to be, and our customers expect it, and that is how we operate.
Yes, that is execution definitely.
Totally.
Energy, the energy segment, it is nice you had an acquisition, Richards, and you have also added to that. But it did grow 33% organically, I think, in the last quarter, last fiscal Q. You have grid hardening there. You have aging utility infrastructure. Obviously, you have the data center power build-outs. How should investors think about it? Is this a mid-teens growth business that we should think about for energy and-
I actually do think it is. I think when you sit there, we are doing connections for energy utilities. Really what you have, and I mentioned it earlier, a market that used to be a 1%-2% market that I would have described to investors 5, 10 years ago as a cash cow and we would be using to fund other things, is really a market that is probably growing 3x what it used to. Where we position ourselves both organically and inorganically is here in North America is our strongest position around grid hardening. It is also around making sure we get the power to the data centers. We benefit from that. About 30% of our business does come from that, which does drive the growth you have talked about, as well as what is happening with undergrounding and just protecting the network where there is deferred maintenance.
It is an area where, no different than the data side, the power side has very long tailwinds on it. I know it is probably not a discussion as much here today in a tech conference as elsewhere, but it is something where we built a $2 billion business. We are wrapping up this year, that is going to be growing double digits. I actually think there is a lot more opportunity because I think we are very unique, not only what we do with the rack, but also getting the power to the data center actually creates both growth vectors on the data and the power side.
You recently acquired Astrodyne, right?
Yeah.
How does that accelerate the momentum you are seeing in energy?
Actually, on the Astrodyne, while it does relate to the power infrastructure, it is not really in our energy business. It is really going into power, and power filtering that actually goes into specialized equipment for semiconductor manufacturing, goes into aerospace applications, and it is just another one of the things around the power theme we like. We have always done power filters to really make sure you get power quality going through. Astrodyne does some of that, as well as niche power supplies that we brought in, but it plays right into the power theme, but it does not go to the utility side.
Okay
Like our energy business.
Right. It is more on the.
Adjacent to it.
ACL. Okay. Same theme, but just a different end market.
Exactly.
Okay. Which brings me to ACL, which also did grow double digits in Q3. You said now factory automation possibly has hit an inflection point here? Yes. What has been behind that? When you just think about AI and as it is impacting various industries, including perhaps manufacturing, how do you think about that demand there for factory automation and ACL? Yeah.
One we get very excited about because I know when we talk about AI, we always talk about the data center.
Yeah.
But let's realize, when you're in a factory and you're trying to provide productivity, it's the data on the factory floor that makes that happen. So when you think about what we do here, this is where we're getting more devices connected, and that's actually bringing that data that the central AI can do, and we've seen the inflection point be all around the world. This is a space where general automation was slow for a couple of years post-COVID. We've really seen every region in the world pick up. It is around the connectivity. For us, it's very much a data play on the hardware that we support the major automation players of the world, and it's something, back to the CapEx trend I talked early on, we're seeing that accelerate.
And we get content on top of that due to what's happening with data and the connectivity solutions we provide our partners. So it's something that not only getting a content play, I would also say we're getting a cycle uplift—
Right
now after a couple of years that were the doldrums—
Right. Yeah
post-COVID.
How does the acquired assets from Astrodyne fill up that portfolio for ACL?
It rounds out our portfolio from a power filter globally. We had more of a European and Asia presence. They were North America, so it helps round it out. It also gives us an entryway more into semiconductor manufacturing equipment, where we were not as strong. They were strong there, it is just something where we see the trends around data and what our semiconductor customers have to do from an equipment side.
Okay.
It is something that is going to give us a new market entry. The business, it is going to grow double digits. It is accretive to our earnings. Certainly will fit into our cash model as we go forward.
Okay. Let me just ask the audience. Any questions? Okay. Let us talk about automotive.
Sure.
Transportation. Within transportation, automotive is one of the segments. That's a pretty meaningful portion of your portfolio, and the unit production in autos is more or less flattish, maybe slightly down. You're still talking about content growth, outperformance relative to that. In any given quarter, though, sometimes it undershoots some of what your target model is.
Yeah.
Just help us understand, when you talk about 4% - 6%, what gives you confidence that you should be able to grow at that rate organically?
Yeah. You said it well. Production environment in automotive globally is down a little bit all around the world, but we're growing 4- 6 points above that. That is how we think about it in TE. We are very global. We're very fortunate about is we're not out of weight in any region, and our strength in Asia really has been helping offset some weakness in the Western world in prior years. When you think about how we drive content performance greater than production, it does come back to data and power again. What used to be the electrified vehicle was a bigger driver, has absolutely flipped over to the data in the vehicle.
Things around autonomy in the vehicle, things that are software defined, they're things that are driving a bigger part of the 4% - 6% than we would've had three years ago, which we would've talked more electric vehicle. In addition, we continue to benefit from our strong position in Asia, which is still very high penetration of electrified. The last element is the other things that happened in the car architecture. Zonal architectures. You come into any comfort or safety features that bring electronics, which just comes into what you need when you have a connectivity supplier. All of that creates the 4% - 6%, and with some of the EV element behind us now, like North America was a tough EV environment this year, actually feel very good about the 4% - 6%. We've been hanging at the low end of that range.
Hopefully being able to move it up here as we move forward in a flattish auto environment.
Okay. All right. Defense. I think we heard from one of your peers as well that defense is a very strong market.
Very strong.
Yep. What's going on there? Obviously, there is a lot of spending that's being directed to defense. But as it relates to your content, what's driving and how should we think about that growth in that end market?
A couple of things. In aerospace and defense, which is a couple billion USD for us, first off being it's the same themes elsewhere. How are you getting compute more distributed? Certainly, it's in drones. You're also getting into power in them. You get that across all the applications that unfortunately we see every day. That is just continuing to build momentum, and once again, a market that was probably a 3% market, has inflected up in Europe as well as the U.S. So we're across a broad base of programs, which is very good, and you're going to continue to see not only in defense, but also what we're seeing from space applications.
Anything around a lower satellite, certainly the things that SpaceX does, Blue Origin does, we also have content on those, which once again comes into data, compute, and power connectivity that you need in those applications. That is also an increased content provider. Then we have the traditional commercial aerospace that has actually gotten healthy again from a stability perspective. So our aerospace and defense, we expect to be double digit as we move forward. We're trying to add capacity to make sure we can keep up with the needs of our customers, and that's what we're in the middle of now, but that's another one that, back to your first question, what continues to have stronger momentum? Certainly,
Right
the aerospace and defense.
Are there aspects of, defense is pretty broad.
It's very broad.
Yeah, exactly. Are there aspects of that that maybe TE is more over-indexed to?
We're very broad.
Very broad based.
throughout.
Okay.
Sure.
All right. Okay. Margins. I know he's not here, but I'm sure he'd love to talk about margin expansion.
I typically hand it off to him.
Yes, exactly. So just on margin expansion, right? Are you thinking about content growth, which generally-
Totally
Yeah, that, just given if units are not growing, but content that should hopefully drive margin expansion here. At the same time, you're also investing in capacity that also takes a hit on your cost through higher depreciation. Just help us understand, when you think about the margin expansion, and you guys have already expanded margins, what's the runway there? Should investors be expecting more margin expansion opportunities?
I think they should. With the volume that we're seeing, as well as the levels we're running at with both of our segments being around 22% margin, we do expect that we're able to expand margin from here while investing. We did a lot of structural work a handful of years ago that we're really seeing the benefit of today. Our footprint's in really good shape globally while it's localized, and you're going to see that we continue to move the margin up 30, 50 basis points a year, probably about 30% flow-through on the revenue while we continue to invest in the programs we talked about in those growth areas. But net, I think you can continue to see the margin move up because of the level we're executing.
Right. If you were to double-click on those margin expansion drivers, you already talked about volume, but is there pricing that plays, or is there higher cost declines that are coming into play as well?
Productivity programs and
Okay
executing on the volume. Pricing, I would say you will see pricing as we do it to offset inflationary cost, but then we do have efficiency and productivity programs that we have to drive to make sure we continue to invest in the business while expanding the margins. I think the momentum we have there has been very strong and proven the past few years, and we'll keep that up, which will continue to expand while we can also reinvest as
Anything on the mix side between the various segments that investors should think about from a margin?
Well, first off, I do think you are going to see greater margin expansion in our industrial segment than our transportation segment. We sort of say 30% + overall, but with the volume that we will see in the industrial segment, I think that is one that you will see faster expansion there. Otherwise, it would just be enter unit mix, which turns, like you said, one quarter to another.
Right.
I don't think there is anything else structural.
Right. But the industrial market is pretty big, right? Your industrial segment. Obviously it has DDN in there as well, and then you have-
Segments are pretty equal. Our industrial segment is just as big as our transportation.
Transportation, right. So within that, anything on mix that we should think about, if aerospace is stronger or ACL is stronger?
They are all very healthy.
Okay.
They are all very healthy.
All right. We talked a little bit about competitive dynamics, but like your competitors are chasing the growth that they're seeing in all these end markets, right? How do you prioritize? Do you love all your children here? Are some children much nicer so they get a little bit more spending here? As we think about, I'm sure it's capital allocation, right? Where do I invest R&D?
Sure
Where do I invest factories? When you think about all these growth drivers, where should investors see TE's moat getting stronger?
Yeah
Perhaps in some of these end markets? Because they all seem to be growing quite nicely.
Not every child gets treated the same.
Okay.
So even if you went back five years ago, we would've said, "Hey, we're going to invest in EV in Asia to really take advantage of that." Right now, you're seeing us take the returns we're getting out of our automotive business and investing it in DDN, into energy, both organically and inorganically. So it really comes to the return profile that we see, as well as strengthening ourselves competitively.
Okay.
You have seen us move up our investment rates, both in engineering as well as CapEx, and that's been really in our industrial segment. You've also seen our acquisitions. They're in the industrial segment, and you're going to continue to see increased investment there versus other areas as we talked about the growth today. So you're going to see that follow that growth as we build out that moat and make it stronger. In some cases, that may be engineering, some cases it may be footprint. In some cases, it may be an acquisition that helps strengthen it, but I think you'll continue to see that over-investment in the industrial.
When you talk about engineering capacity, because you talked a lot about customer co-creation, right?
Yeah.
Being right there with the customers, deep in design. Any areas, geographic areas or regions that we should see, okay, these were investments that TE is making ahead of the growth that they see?
Actually, we already have a good foundation.
Okay.
At Investor Day, we talked about we have increased our engineering by about 2,500 people. We went from 7,500 to about 10,000 over the past three years. I actually feel the actual geographic footprint is good, especially with the geopolitics we have, really deepening them. And certainly, as our customers get deeper, we need to be there with them from an engineering perspective.
Any questions from the audience? One there. Can you just-
Annual basis, how do you think about price and to Class 8 truck exposure, which on your industrial business.
Sure. So two very different questions. Thank you. First off, on price. Price in our world, a slight positive. Certainly, our industrial business is a little bit more positive on that than our transportation business, but our transportation business has been relatively flat. When you sit there, that's where it's been, and any of that price has been very much offsetting inflation we felt. That's how I think you should think about it. If we have inflation on tariffs, if we have inflation on material, we're going to get it back on price, and that's how we've been managing it. On your second question on Class 8 trucks, we do a little bit shy of $2 billion globally in heavy truck, Class 8, ag, as well as construction. Honestly, it's finally hit an inflection point of a pickup.
We've been seeing a lot of strength in Europe and Asia the past few years, North America being very weak. Starting to see that inflection point the past three, six months here. Feels like it's a cyclical pickup. Not only on top of the cyclical pickup, the other element that we get, we get about 4-6 points of content outperformance in Class 8 trucks, not only due to emissions. We're strong in Asia as well, where believe it or not, electric trucks are a real deal. I know it's far for us to think about here in the United States, but it is big in Asia, as well as what's happening in data connectivity in a truck. They create the same content opportunities that we would have in a car. You see those coming into a truck.
Just this last quarter, we grew double digits in our industrial and commercial transportation business. But it's nice to see North America finally showing back up here and getting a little bit of a cyclical pickup with content pickup. So thank you for your question.
A little bit on the growth algorithm as you think about free cash flow conversion. How should investors think about allocation towards acquisitions from that free cash flow conversions? Because you guys obviously have very strong free cash flow there from earnings. How should we think about acquisitions versus how you prioritize buybacks or dividends?
First off, being free cash flow conversion, one of the things that I also think to the operating execution or free cash flow conversion, even with the increased investments running about 100% of net income, and that's where it all starts. You have to do that first.
Right.
We think about 30% free cash flow yield on the dividend, is how we think about it, and we take our dividend up for that. The other 70% is really best use. With where the stock's trading or M&A opportunities, and I do think we have the opportunity to both, certainly with the strong cash flow we have. Clearly with where the stock's trading now, we are buying back stock. We did that last quarter, even with the Astrodyne deal, and you would expect us to do it as well. But we have choices with the strong free cash flow that we have.
Okay. At the Analyst Day, you talked about 6%-8%, your long, I guess, through cycle.
Yeah
framework that we should be clearly seeing a lot of momentum.
Totally .
Right? You talked about double-digit growth across a bunch of segments. Maybe just as we round up here, what part of the TE story maybe investors don't fully appreciate?
No, I think, to your question, first off, investors are the ones that are the judge at the end of the day. So things I would stress personally is, I know I'm at a tech conference and everybody wants to talk about AI, but I also think the broadness of the growth we have and the fundamentals that we've driven to improve them, I do think is a little bit underappreciated right now. I think when you think about both data and power across our portfolio, certainly AI is the area to think about data. But when I think about our $2.5 billion of growth this year, we would have been in our target growth range even without AI. I think that shows where we position the portfolio as we move forward. I also believe with the margin improvement that you've seen, it's pretty broad.
It's not one unit that's driving the margin, and it's not one unit that's driving the growth. It's pretty broad. That's delivered 15% plus growth this year. The cash flow model always gives us options. Options of whether we return to you, and we always will give the dividend, but certainly how we add to it, and like we've been doing the past couple of years, of adding to the portfolio in the power side. Certainly what we've added in the optic side, that creates future growth momentum as we go forward. So there are just some things I would highlight that I would stress to you all as you look at us.
Great. I am going to wrap it here. Thank you very-
Thank you, Asiya. I also thank you all for being here. Appreciate it.
Thank you.
Thank you for being here.