TE Connectivity Ltd. (TEL) Earnings
TE Connectivity Ltd. is expected to report next earnings on July 22, 2026 (in NaN days), with a consensus EPS estimate of $2.81. TEL has beaten EPS estimates in 11 of its last 12 reported quarters (average surprise +6.0% over the last four).
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| Apr 22, 2026 | $2.69 | $2.73 | +1.5% | $4.7B | -0.0% |
| Jan 21, 2026 | $2.55 | $2.72 | +6.7% | $4.7B | +3.1% |
| Oct 29, 2025 | $2.29 | $2.44 | +6.6% | $4.6B | -0.1% |
| Jul 23, 2025 | $2.08 | $2.27 | +9.1% | $4.5B | +4.9% |
| Apr 23, 2025 | $1.96 | $2.10 | +7.1% | $4.1B | +4.4% |
| Jan 22, 2025 | $1.89 | $1.95 | +3.2% | $3.8B | -1.8% |
| Oct 30, 2024 | $1.94 | $1.95 | +0.5% | $4.1B | +1.8% |
| Jul 24, 2024 | $1.86 | $1.91 | +2.7% | $4.0B | -0.9% |
| Apr 24, 2024 | $1.83 | $1.86 | +1.6% | $4.0B | +0.2% |
| Jan 24, 2024 | $1.72 | $1.84 | +7.0% | $3.8B | -0.8% |
| Nov 1, 2023 | $1.76 | $1.78 | +1.1% | $4.0B | +4.7% |
| Jul 26, 2023 | $1.66 | $1.77 | +6.6% | $4.0B | -0.2% |
Source: company filings + earnings calendar. For informational purposes only — not investment advice.
Earnings call summary
Q2 FY2026 · April 22, 2026
AI summary of management’s prepared remarks and analyst Q&A. For informational purposes only — not investment advice.
Management highlights
• Framed the call around key messages from investor day in November, outlining strategy driving growth, margin expansion, and double-digit earnings growth. • Second quarter sales were over $4.7 billion, with 15% growth on a reported basis and 7% organically. Record orders of over $5 billion in the second quarter. • Adjusted earnings per share were $2.73, up 24% year over year. Operating margins on an adjusted basis were 22%. • Free cash flow for the first half of the year was $1.3 billion. Board approved a 10% increase to the quarterly cash dividend. • Third quarter sales expected to be $5 billion, with adjusted earnings per share expected to be up 17% year over year to around $2.83. • Orders were $5.3 billion with a book-to-bill of 1.12, with growth in every business and region. Over 70% of order growth in the second quarter was in the industrial segment. Transportation segment orders increased 13% versus the prior year. • Industrial segment benefited from secular growth trends in digital data networks, energy, aerospace and defense, and factory automation. Acquired a leading technology for passive optical connectivity solutions. • Transportation segment delivered growth over market in automotive and commercial transportation, with content growth across vehicle platforms.
Guidance
• Expect to deliver well over $2 billion of growth this year, with the majority of businesses growing double digits year over year. • Second quarter sales over $4.7 billion, with 15% growth on a reported basis and 7% organically. Third quarter sales expected to be $5 billion, up 10% versus the prior year. • Adjusted earnings per share expected to be up 17% year over year to around $2.83 in the third quarter. • Free cash flow conversion expected to be 100% this year. • Expect restructuring charges in fiscal 26 to be roughly $100 million. • Adjusted effective tax rate expected to be approximately 22% for the full year, with cash tax rate well below adjusted ETR.
Segment performance
Industrial Segment: Sales grew 27% in the quarter and 17% organically year over year. Digital data networks business grew nearly 50% year over year. Automation and connected living grew 8% organically. Energy sales grew 60%, including the Richards acquisition, with 11% organic growth. Aerospace and defense sales grew 5% organically. Medical sales grew sequentially. Industrial segment adjusted operating margins expanded 260 basis points to nearly 22%. Transportation Segment: Sales grew 5% in the quarter, down slightly organically. Auto sales grew 2% on a reported basis and declined 4% organically. Commercial transportation saw 21% growth on a reported basis and 17% organically. Sensors business sales increased 2% on a reported basis and declined 3% organically. Transportation segment delivered adjusted operating margins of nearly 22%.
Risks & headwinds
• Increased inflationary pressures across certain input costs such as oil-based resins and freight charges driven by higher energy costs and broader geopolitical tensions. • Geopolitical tensions and supply chain volatility could impact business operations and costs.
Analyst Q&A
Q: Hey, good morning, guys. Can you talk about the $150 million bump-up in AI revenue?
A: The $150 million relates to the second half, part of ramping programs and new ramps. DDN AI revenue, which runs about 70% of total DDN, is approaching $2.4 billion, with momentum continuing and growth in the second half.
Q: Orders were strong again this quarter. Can you speak more on whether the momentum can be sustained and business trends in April?
A: Orders were strong with $5 billion in first quarter and $5.3 billion in second quarter. Order momentum continues strongly, no demand negative impacts due to conflict. Growth is broad across businesses, with industrial segment businesses growing double digits, and transportation segment orders up, showing confidence in sustainability.
Q: Maybe provide an updated perspective on the copper versus optical debate in AI?
A: It's copper and optical, not either/or. Copper will continue to be the workhorse in the rack due to cost, power, and reliability benefits. TE acquired a leading technology for passive optical connectivity solutions to strengthen the roadmap, with technology fitting nicely and trends positive.
Q: Talk about durable growth in energy and commercial transport segments?
A: In energy, focused on U.S. energy market with growth in utility grid hardening, data center, and clean energy applications. Organic growth double digits. In commercial transport, global business with strength in Asia, Europe, and stabilization in North America, driven by next-gen vehicles and trends in automotive.
Q: Share color on what's driving acceleration in content growth and characterize sequential change in DDN orders?
A: In auto, production environment playing out as expected with regional differences. DDN orders had 60% year-over-year increase, with bumpiness due to programs, but strong momentum across broad customer base.
Q: Talk about margins and inflationary costs?
A: Seen oil-based derivatives and freight costs increase. Have a playbook to manage, able to pass through in part, but some noise in absolute margins. Committed to at least 30% flow through on operating income side.
Q: How to think about price inherent in orders versus P&L and CapEx expectations?
A: Orders are project-based, no real activity or motivation to get ahead or pull things in. CapEx expected to run about 6% of revenue, driven by ramping AI programs in DDN business tied to specific programs.
Q: Trends in enterprise telecom and other IT?
A: Seeing nice growth in enterprise telecom and other IT spaces, not at rates of AI side but constructive growth.
Q: Tightness in components and visibility from hyperscalers?
A: Not seeing availability issues on procurement for products. Customers building backlog, but not seeing impact on businesses yet.
Q: Energy market growth outlook?
A: 60 plus percent of energy business is utility grid hardening, with industrial/slash data center space full steam ahead, clean energy side having some lumpiness but expecting double digit trend.
Q: Capabilities added relative to optical and copper in scale up?
A: Technology acquisition helps in scale-out, increase of content, and positioning to hit inflection points with customers.
Q: Co-packaged optics and downside of customer switch from copper?
A: It's copper and fiber, not or. Copper TAM will continue to grow due to power elements, and TE is nicely positioned for optical inflection points.
Q: Why revenue hasn't grown meaningfully in DDN for last couple quarters and industrial segment margin decline?
A: Programs have lumpiness with supply chain impacts. Year-over-year margins up significantly, sequential margins have noise due to ramped investments and pinch points, but good on year-to-date basis.
Q: Size of optical business for AI applications today and need to bolster it?
A: Focused on passives, technology acquisition helps in fiber attach and scale-out options, will continue to build out via partnerships and acquisitions.