StockNews.AI

TE Connectivity announces first quarter results for fiscal year 2026

StockNews.AI • 4 hours

High Materiality9/10

Information

Exceeds guidance with 22% sales growth and over 30% EPS growth year over year GALWAY, Ireland, Jan. ...

Original source

AI Summary

TE Connectivity's fiscal Q1 showed impressive results with 22% sales growth and 45% EPS increase, exceeding guidance. The company reported record orders of $5.1 billion, setting the stage for robust growth this fiscal year, further bolstered by innovations in key sectors such as AI and transportation. Anticipated sales of $4.7 billion in Q2 suggests continued upward momentum.

Sentiment Rationale

Historical trends show that strong earnings results typically correlate with positive stock performance. TEL’s consistent sales and EPS growth indicates a robust business model, potentially enhancing investor confidence.

Trading Thesis

TEL is a buy given strong Q1 performance and positive Q2 outlook.

Market-Moving

  • EPS growth of 33% signals strong operational efficiency.
  • Record orders of $5.1 billion imply robust demand across segments.
  • Expected 13% sales growth in Q2 indicates sustained momentum.
  • Improved cash flow supports potential for shareholder returns.

Key Facts

  • TE Connectivity reported Q1 results with 22% sales growth year over year.
  • GAAP EPS rose by 45%, reaching $2.53, exceeding guidance.
  • Operating margin improved 260 bps to 20.6% amid strong operational performance.
  • Record quarterly orders of $5.1 billion indicate robust future growth potential.
  • Q2 expectations predict sales growth of 13% and adjusted EPS of $2.65.

Companies Mentioned

  • TE Connectivity (TEL): Strong Q1 results boost outlook, demonstrating operational strength.

Earnings

This fits the 'Earnings' category as TE Connectivity has released its quarterly earnings with significant performance indicators, leading to implications for share price movement and investor sentiment.

TE Connectivity Reports Strong First Quarter Results for Fiscal Year 2026

TE Connectivity plc (NYSE: TEL) announced its financial results for the first quarter of fiscal year 2026, covering the period that ended on December 26, 2025. The company exceeded its guidance with remarkable growth, achieving a 22% increase in sales and over 30% growth in earnings per share (EPS) year over year.

First Quarter Financial Highlights

  • Net Sales: $4.7 billion, a 22% increase year over year.
  • Organic Growth: 15% increase in net sales.
  • GAAP EPS: $2.53, reflecting a 45% increase year over year.
  • Adjusted EPS: $2.72, a 33% increase year over year.
  • GAAP Operating Margin: 20.6%, up 260 basis points from the previous year.
  • Adjusted Operating Margin: 22.2%, an increase of 180 basis points year over year.
  • Record Orders: $5.1 billion, a rise of 28% year over year and 9% sequentially.
  • Cash Flow: Operating activities contributed $865 million, with free cash flow at $608 million, and $615 million returned to shareholders.

CEO Remarks on Growth Strategy

In a statement, CEO Terrence Curtin highlighted, "Our teams delivered strongly against our strategy, resulting in first quarter earnings growth over 30% and sales growth of more than 20%, both of which were above our guidance and driven by growth in both segments." Curtin noted that investments in data and power connectivity in sectors such as artificial intelligence (AI) and energy solutions continue to fuel growth.

He added, "We expect double-digit sales and adjusted earnings growth again in our second quarter as our teams continue to innovate with our customers to ensure next generation technologies are brought to life."

Second Quarter Outlook for Fiscal Year 2026

Looking ahead, TE Connectivity projects second-quarter sales to be around $4.7 billion, reflecting a 13% reported increase and 6% organic growth year over year. The company anticipates adjusted EPS of approximately $2.65, which would signify a 20% growth year over year, while GAAP EPS is expected to be about $2.26.

Beginning in fiscal 2026, the company will exclude amortization expenses on intangible assets, as well as related tax effects, from certain non-GAAP measures.

Conference Call and Investor Information

TE Connectivity will hold a conference call for investors today at 8:30 a.m. ET. Interested parties can access the call via:

  • Web: investors.te.com
  • Phone: U.S. participants: (800) 715-9871; International callers: (646) 307-1963.

A replay of the conference call will be accessible on TE Connectivity's investor website starting at 11:30 a.m. ET on January 21.

About TE Connectivity

TE Connectivity plc (NYSE: TEL) is a leading global industrial technology company, dedicated to creating a safer, sustainable, and connected future. With a comprehensive range of connectivity and sensor solutions, TE enables the efficient distribution of power, signals, and data across industries including automotive, energy, data centers, and more.

The company employs over 90,000 individuals, including 10,000 engineers, operating in approximately 130 countries worldwide. To learn more, visit www.te.com or follow TE on social media platforms such as LinkedIn, Facebook, WeChat, and Instagram.

Understanding Non-GAAP Financial Measures

TE Connectivity presents non-GAAP financial metrics alongside GAAP results to offer investors additional insights into its operational performance. These non-GAAP measures help in assessing the company's ability to generate cash and identify trends within its business. It is important to note that these measures can differ among companies and should be used in conjunction with GAAP measures for comprehensive analysis.

Related News