Summary
TE Connectivity plc (TEL) reported its fiscal second quarter 2024 results, showing a net sales decrease of 4.6% year-over-year to $3.97 billion. This decline was primarily driven by organic sales decreases across all three segments: Transportation Solutions (-4.0%), Industrial Solutions (-4.0%), and Communications Solutions (-9.5%). Despite the top-line pressure, gross margin improved significantly to 34.4% from 30.9% in the prior year's quarter, benefiting from improved manufacturing productivity and prior year pricing actions. Diluted earnings per share from continuing operations increased to $1.75, up from $1.36 in the same period last year, reflecting the improved gross margin and effective cost management. For the first six months of fiscal 2024, net sales decreased by 2.5% to $7.80 billion, also impacted by segment-level declines, particularly in Communications Solutions (-13.4%). However, gross margin for the six-month period also showed robust improvement, increasing to 34.5% from 30.9% a year ago. Diluted earnings per share from continuing operations surged to $7.54, a substantial increase from $2.60 in the prior year's comparable period, largely due to significant income tax benefits recognized in the current year. The company also completed the acquisition of Schaffner Holding AG for $339 million, enhancing its Industrial Solutions segment.
Financial Highlights
52 data points| Revenue | $3.97B |
| Cost of Revenue | $2.60B |
| Gross Profit | $1.36B |
| SG&A Expenses | $444.00M |
| Operating Income | $692.00M |
| Interest Expense | $19.00M |
| Net Income | $541.00M |
| EPS (Basic) | $1.76 |
| EPS (Diluted) | $1.75 |
| Shares Outstanding (Basic) | 308.00M |
| Shares Outstanding (Diluted) | 310.00M |
Key Highlights
- 1Net sales for the second quarter of fiscal 2024 declined by 4.6% year-over-year to $3.97 billion, impacted by broad-based weakness across all reporting segments.
- 2Gross margin showed strong improvement, increasing to 34.4% in Q2 2024 from 30.9% in Q2 2023, driven by better manufacturing productivity and pricing.
- 3Diluted Earnings Per Share (EPS) from continuing operations rose to $1.75 in Q2 2024, up from $1.36 in the prior year's quarter, showcasing enhanced profitability despite lower sales.
- 4For the first six months of fiscal 2024, net sales decreased 2.5% to $7.80 billion, while diluted EPS from continuing operations saw a significant jump to $7.54, aided by substantial income tax benefits.
- 5The company acquired Schaffner Holding AG for $339 million, strengthening its Industrial Solutions segment with electromagnetic solutions capabilities.
- 6Cash flow from operations remained strong, with $1.43 billion generated in the first six months of fiscal 2024, indicating robust underlying cash generation.
- 7The company provided a positive outlook for the third quarter of fiscal 2024, expecting net sales of approximately $4.0 billion, with stabilization expected in Communications and Industrial Solutions, though Transportation Solutions are projected to decline.