TE Connectivity plc (NYSE: TEL), a global leader in industrial technology solutions, reported impressive financial results for its fiscal second quarter ended March 28, 2025, exceeding market expectations on both net sales and earnings per share (EPS). With net sales of \(4.1 billion—up 4% year-over-year on a reported basis and 5% organically—and a record adjusted EPS of \)2.10, an approximately 13% increase year-over-year, TE Connectivity demonstrates robust operational efficiency and strong market demand.
The company’s Transportation and Industrial Solutions segments both contributed to the solid performance. The Industrial Solutions segment notably achieved double-digit organic growth, driven by advancements in artificial intelligence, aerospace, and energy applications. This segment’s operating margin expanded significantly, reinforcing the success of TE’s strategic investments in high-growth industrial technologies.
Operating margins were strong, with a GAAP operating margin of 18.1% and an adjusted operating margin of 19.4%, indicating effective cost management and operational leverage. Orders increased 6% year-over-year and sequentially, totaling $4.25 billion, which reinforces sustained demand momentum.
Cash flow generation was equally impressive, with operating cash flow reaching \(1.5 billion in the first half of fiscal 2025 and free cash flow approximately \)1.1 billion. The company also returned nearly $1 billion to shareholders and announced a 9% dividend increase, underscoring confidence in cash flow stability and commitment to shareholder value.
Strategic acquisition of Richards Manufacturing Co. was completed in April 2025, broadening TE Connectivity’s footprint in the North American utility market and positioning the company to capitalize on accelerating growth opportunities.
The company’s environmental leadership was highlighted in its One Connected World corporate responsibility report, detailing an 80% reduction in Scope 1 & 2 greenhouse gas emissions over the past four years, reflecting strong commitment to sustainability.
Forward-looking guidance for the third quarter of fiscal 2025 anticipates net sales of approximately \(4.30 billion, representing 8% year-over-year growth. Adjusted EPS is projected at about \)2.06, an 8% increase, inclusive of tariff impacts and acquisition benefits. Despite some tax rate headwinds, TE Connectivity exhibits strong confidence in navigating the current uncertain macroeconomic landscape.
This quarter’s results and guidance reflect continuation of themes from TE Connectivity’s previous earnings calls, where management emphasized geographic diversification, operational agility, and investments in key high-growth verticals such as AI, aerospace, energy systems, and data networks.
In assessing the impact on financial statements, the fiscal Q2 performance marginally improved operating margins and cash flow compared to the previous year, driving enhanced shareholder equity and liquidity positions. Notably, free cash flow of approximately $1.1 billion in the first half of FY25 demonstrates TE’s strong cash conversion efficiency, underpinning dividend growth and acquisition funding.
TE Connectivity’s strategic focus on innovation, operational excellence, and sustainability places it in a strong position to capitalize on long-term industrial technology trends, creating significant value for customers and investors alike.
For comprehensive details, the full 8-K report can be accessed here: TE Connectivity 8-K Report.
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