TE Connectivity Q4 earnings rise 21% on data and power demand

TE Connectivity plc (TEL) said on Oct. 28 that adjusted earnings per share for its fiscal fourth quarter were $3.14, above the $3.10 consensus estimate compiled by Finnhub. Net sales of $5.31 billion were in line with the $5.33 billion estimate.

The company said in a press release furnished with its 8-K that net sales rose 12% from a year earlier on a reported basis and 13% organically. Orders were $6.1 billion, up 29% from a year earlier and 6% from the prior quarter.

The company has more than 100,000 employees and works with customers in about 130 countries, according to the release. Its fiscal year ended Sept. 25.

Here's how the company did:

• Adjusted EPS: $3.14 vs. $2.59 a year earlier, above the $3.10 consensus estimate compiled by Finnhub
• GAAP diluted EPS from continuing operations: $3.10 vs. $2.23 a year earlier
• Net sales: $5.31 billion vs. $4.75 billion a year earlier, in line with the $5.33 billion consensus estimate compiled by Finnhub
• Adjusted operating margin: 22.1% vs. 21.1% a year earlier

For the full fiscal year, the company said net sales rose 15% to $19.9 billion and adjusted EPS rose 24% to $11.52. GAAP EPS was $11.07.

CEO Terrence Curtin said: “Our teams delivered a strong fourth quarter to finish a year in which we set records in sales, earnings and cash generation.”

Segment results

Transportation Solutions sales were $2.6 billion in the quarter, up 8% from a year earlier. Industrial Solutions sales were $2.8 billion, up 20%.

The company said fourth-quarter sales include an $87 million reduction for tariff refunds it expects to return to customers. The refunds reduced adjusted EPS by $0.01 in the quarter.

2027 outlook

The company expects first-quarter fiscal 2027 sales of about $5.35 billion, up 15% on both a reported and organic basis. It expects adjusted EPS of about $3.30, up 21% from a year earlier.

The company also expects organic sales growth for fiscal 2027 that is similar to its fiscal 2026 performance, when organic sales rose 12%.

In its July 22 results release, the company had expected fourth-quarter sales of about $5.25 billion and adjusted EPS of about $3.05.

Cash and capital returns

Cash flow from operating activities was $1.5 billion in the quarter, and free cash flow was $1.2 billion. The company returned about $800 million to shareholders in the quarter.

For the full year, free cash flow was $3.4 billion and the company returned about $2.8 billion to shareholders. It also committed $1.6 billion for bolt-on acquisitions in the Industrial segment to broaden its optics and power filtering portfolios.