TE Connectivity plc Ordinary Shares
TEL · NYSE
Next quarter
Reports Nov 4, 2026.
Consensus is $3.07 EPS for Sep 2026 across 4 estimates, ranging $3.05 to $3.12.
TEL Jun 2026
- 3.16%
- -0.74%
- $2.85
- $2.94
- —
- $5.16B
Reported results
- $5.16B
- 35.56%
- $981.00M
- 19.01%
- $748.00M
- $2.55
Highlights
- Earnings beat: Adjusted EPS was $2.94, above the $2.85 consensus by 3.16%, while GAAP diluted EPS was $2.55 versus $2.14 a year ago.
- Record sales: Revenue reached $5.16 billion, up 14% reported and 12.2% organically year over year, compared with $4.53 billion a year ago and $4.74 billion in the prior quarter.
- Industrial-led growth: Industrial Solutions revenue rose 21.9% reported and 21.0% organically to $2.58 billion, led by digital data networks at 34.0% organic growth and energy at 32.7%.
- Orders strengthened: Orders totaled a record $5.7 billion, up 27% year over year, with double-digit growth across all businesses and momentum in data centers and energy infrastructure.
- Margins expanded: Adjusted operating income increased to $1.13 billion from $953 million, lifting adjusted operating margin to 21.9% from 21.0%; GAAP margin was 19.0% versus 18.9%.
- Cash generation remained strong: Operating cash flow was $1.19 billion and free cash flow was $883 million in the quarter; nine-month free cash flow reached $2.17 billion.
- Fourth-quarter outlook: TE expects revenue of approximately $5.25 billion, up 11% year over year, adjusted EPS of $3.05, up 18%, and GAAP EPS of $2.84, up 27%.
- Industrial expansion: TE agreed to acquire Astrodyne TDI for approximately $1.4 billion; the business is expected to add more than $250 million of annual sales and close by calendar year-end.
Analysis
TE Connectivity’s fiscal third quarter was a broad-based growth print, with adjusted EPS of $2.94 beating the $2.85 consensus by 3.16%. Revenue was a record $5.16 billion, up 14% reported and 12.2% organically from $4.53 billion a year ago, and up roughly 9% sequentially from $4.74 billion in the second quarter. Adjusted EPS rose 22% year over year from $2.41, while GAAP diluted EPS increased to $2.55 from $2.14; the filing’s prior-quarter diluted EPS was $2.90.
The defining feature was Industrial Solutions, where organic sales grew 21.0% and operating income rose to $537 million from $395 million, supported by AI-related digital data networks, energy infrastructure, automation, and aerospace. Transportation was steadier, with organic sales up 4.5% as commercial transportation growth and higher automotive content offset lower vehicle production and sensor weakness. Record orders of $5.7 billion, up 27%, point to continued demand, while adjusted operating margin expanded 90 basis points to 21.9% despite $83 million of restructuring charges. TE also maintained substantial cash returns, including $1.35 billion of year-to-date repurchases and $643 million of dividends, while committing to the $1.4 billion Astrodyne TDI acquisition.
Growth and demand
TE delivered its strongest quarterly sales level on record, with growth spanning both reportable segments. Orders exceeded sales and increased by more than $1 billion year over year, supporting management’s view that demand is broadening beyond the current quarter.
- Revenue: Sales increased $626 million to $5.16 billion, comprising $554 million of organic growth and $72 million of favorable currency translation.
- Orders: Orders reached $5.7 billion, up 27% year over year, with double-digit order growth in every business.
- Pricing: Net pricing actions added $34 million to organic sales in the quarter, including a $46 million benefit in Industrial Solutions partially offset by $12 million of price erosion in Transportation Solutions.
Industrial Solutions
Industrial was the principal engine of the quarter, combining rapid organic growth with stronger operating leverage. The segment’s operating margin improved even as TE continued investing in capacity and manufacturing infrastructure.
- Sales: Revenue rose 21.9% reported and 21.0% organically to $2.58 billion, with organic growth of 34.0% in digital data networks, 32.7% in energy, 14.3% in automation and connected living, and 11.5% in aerospace, defense, and marine.
- AI and energy: Digital data networks benefited primarily from artificial-intelligence applications, while energy growth reflected grid hardening and data-center applications.
- Profitability: Operating income increased $142 million to $537 million, and operating margin expanded to 20.8% from 18.7%, primarily on higher volume.
Transportation Solutions
Transportation produced moderate organic growth and continued to outperform underlying vehicle production through content gains, although segment reported profit declined because of restructuring charges and a more difficult mix.
- Sales: Revenue grew 6.7% to $2.58 billion, including 4.5% organic growth and a 2.2% currency benefit.
- End markets: Automotive organic sales increased 2.9% on higher content per vehicle despite lower global vehicle production; commercial transportation grew 17.8%, while sensors declined 2.8%.
- Profitability: Operating income fell to $444 million from $462 million and operating margin declined to 17.2% from 19.1%, including $79 million of restructuring charges versus $7 million a year earlier.
Margins and restructuring
Underlying profitability improved, with productivity and volume more than offsetting higher operating expenses and continued restructuring activity. The GAAP-to-adjusted difference was unusually meaningful because of the footprint program.
- Operating performance: GAAP operating income rose 14% to $981 million, while adjusted operating income increased 18% to $1.13 billion.
- Margin: GAAP operating margin was 19.0%, up 10 basis points year over year; adjusted margin expanded 90 basis points to 21.9%.
- Restructuring: TE recorded $83 million of restructuring and other charges in the quarter, bringing nine-month charges to $103 million. The fiscal 2026 program is expected to generate approximately $58 million of annualized savings once fully realized.
Cash and capital returns
Cash generation remained a central part of the quarter, allowing TE to fund higher capital spending, dividends, repurchases, and planned acquisitions. Working capital absorbed cash, but operating cash flow was broadly stable year over year.
- Cash flow: Operating cash flow was $1.19 billion, compared with $1.19 billion a year ago, while free cash flow was $883 million versus $962 million.
- Year-to-date: Nine-month operating cash flow was $3.00 billion and free cash flow was $2.17 billion, with capital expenditures of $832 million.
- Shareholder returns: TE returned $2.0 billion to shareholders year to date, including $1.35 billion of repurchases and $643 million of dividends. The company had $3.0 billion of repurchase authorization remaining at quarter-end.
Outlook and Astrodyne
The fourth-quarter outlook preserves the double-digit growth trajectory and excludes any contribution from the newly announced acquisition. Astrodyne adds another power-management asset to the Industrial portfolio but will require additional funding.
- Guidance: Fourth-quarter revenue is expected at approximately $5.25 billion, with reported and organic growth of about 11%; adjusted EPS is expected at $3.05 and GAAP EPS at $2.84.
- Acquisition: Astrodyne TDI will be purchased for approximately $1.4 billion in cash, is expected to contribute more than $250 million of annual sales, and will be reported in Industrial Solutions.
- Funding: Management expects to fund Astrodyne with available cash and commercial paper, supplemented if necessary by its credit facility or new debt financing.
