TE Connectivity plc

TE Connectivity reported third-quarter sales of $5.2 billion, up 14% reported and 12% organically versus last year. Adjusted EPS was $2.94, up 22% year over year, and adjusted operating margin was 21.9%, up 90 basis points. Record orders reached $5.7 billion, up 27% year over year and 7% sequentially. Industrial Solutions sales grew 22% reported and 21% organic, while Transportation Solutions sales grew 7% reported and 5% organic. For Q4, management guided to sales of approximately $5.25 billion, up 11% year over year, and adjusted EPS of approximately $3.05. For the full year, TE now expects sales growth of about 15% and adjusted EPS growth of 23% year over year.

Terrence Curtin framed the quarter as evidence that TE’s strategy is working, driven by the accelerating data-and-power cycle and broader secular trends like electrification, automation and AI infrastructure. He said record order growth and backlog give the company visibility into broad-based growth into fiscal 2027, and reiterated the goal of sustained margin expansion and double-digit earnings growth. His tone was confident and upbeat, with repeated emphasis on being at the intersection of major technology and infrastructure investment.

Heath Mitts highlighted adjusted operating income of over $1.1 billion, adjusted operating margin of 21.9%, and adjusted EPS of $2.94, while noting GAAP EPS of $2.55 after acquisition-related charges, restructuring, and amortization. He said cash from operations was $1.2 billion, free cash flow was $883 million in the quarter, and year-to-date free cash flow was roughly $2.2 billion; TE also returned about $2 billion to shareholders through dividends and buybacks. He reiterated 2026 restructuring charges of roughly $100 million, expects Q4 tax rate of 22% to 23%, and said free cash flow conversion should be roughly 100% this year. On Astrodyne TDI, he said the business has more than $250 million in annual sales, costs about $1.4 billion, and should close by year-end, funded through cash.

Analysts pressed management on the ramp in FAU optical, the size and timing of AI/cloud revenue, DDN bookings versus revenue, China auto trends, energy momentum, defense strength, and the 800V data-center opportunity. Management said optical remains early and incremental, with meaningful revenue from FAU not expected until 2028 and beyond, while DDN momentum is still building backlog for next year rather than fully lifting 2026 sales. On China and autos, TE said its China business outperformed production and exports are offsetting weak domestic demand; on defense and energy, management described strong backlog, program velocity, and mid-teens-type growth trends.