What drove the strong first-quarter results?

Growth was led by Industrial Solutions, where reported sales rose 38% to $2.2B, driven by Digital Data Networks (up 71%, tied to AI data center demand) and Energy (up 88% reported, 15% organic, on grid hardening and renewables). Transportation Solutions grew 10% reported to $2.47B, supported by automotive content gains in Asia and Europe and a recovery in commercial transportation. Operating leverage from higher volume lifted adjusted margins in both segments.

How much of the sales growth came from acquisitions and currency rather than the underlying business?

Of the $833M increase in net sales, about $104M came from favorable foreign currency translation and about $152M from acquisitions (mainly the Energy business acquired in the prior year), leaving roughly $577M, or 15% organic growth. Investors should view the organic figure as the better gauge of underlying demand.

Is the company's balance sheet and cash generation still healthy?

Operating cash flow of $865M and free cash flow of $608M support the dividend and buybacks, and cash of $1.25B is on hand. However, total debt rose to about $5.7B from $4.2B a year ago, inventory increased to $2.95B, and free cash flow declined year over year, so working capital and leverage are worth monitoring.

What changed in how TE reports non-GAAP earnings, and why does it matter?

Starting in fiscal 2026, TE excludes amortization expense on intangible assets from its adjusted measures. This adds about $0.15 per share to Q1 adjusted EPS and about $57M to adjusted operating income. Because prior-period adjusted figures were not restated in this release, the change makes year-over-year comparisons less direct, and investors should compare GAAP EPS alongside the adjusted figure.

What does the outlook imply for the rest of fiscal 2026?

For Q2, TE guided to sales of about $4.7B (+13% reported, +6% organic) and adjusted EPS of about $2.65 (+20%), with sequential growth expected in Industrial and seasonal softness in Transportation. Management reiterated expectations for double-digit sales and adjusted earnings growth in Q2 and described FY26 as a year of strong growth and margin expansion, though the release does not give full-year numeric guidance.

TEL 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed January 21, 2026. Cited figures are marked; the original filing is the authoritative source.

TE Connectivity (NYSE: TEL) reported fiscal Q1 2026 results (quarter ended December 26, 2025) that beat its own guidance on both top and bottom line.

Net sales rose 22% year over year to $4.7 billion^a (15% organic), with GAAP diluted EPS from continuing operations of $2.53 (up 45%) and adjusted EPS of $2.72 (up 33%). Adjusted operating margin expanded 180 basis points to 22.2%, and record orders of $5.1 billion (up 28% year over year, book-to-bill of 1.10) point to continued momentum. Growth was broad-based across both segments, led by Industrial Solutions (reported sales up 38%, driven by AI-related Digital Data Networks and Energy grid-hardening demand) and Transportation Solutions (reported sales up 10%, with automotive content growth in Asia and Europe).

Cash generation was solid, with operating cash flow of $865 million^b and free cash flow of $608 million, of which roughly 100% was returned to shareholders through $405 million of buybacks and $209 million of dividends. Total debt rose to $5.7 billion from $4.2 billion a year earlier, largely reflecting the financing of the prior-year acquisition program, and inventory built to $2.95 billion. Management guided fiscal Q2 2026 to approximately $4.7 billion in sales (up 13% reported, 6% organic) and adjusted EPS of about $2.65 (up 20%), and reiterated expectations for double-digit sales and adjusted earnings growth.

Investors should note that beginning in fiscal 2026 TE excludes amortization of intangible assets from its non-GAAP measures, which flatters adjusted EPS and margin comparisons relative to prior periods. The filing itself is a routine Form 8-K furnishing the earnings press release and slide deck under Items 2.02 and 7.01, so the substance lies in the exhibits. Key watch items are whether Industrial growth persists as Energy and AI comparisons normalize, whether Transportation seasonality weighs on the next quarter, and whether the higher debt load constrains flexibility.

02—Key points

Key Highlights

Net sales of $4.67B, up 22% reported and 15% organic year over year, beating company guidance; Industrial Solutions sales up 38% reported.
Adjusted EPS of $2.72, up 33% year over year; GAAP diluted EPS from continuing operations of $2.53, up 45%.
Adjusted operating margin of 22.2%, up 180 bps year over year; GAAP operating margin of 20.6%, up 260 bps.
Record orders of $5.1B, up 28% year over year and 9% sequentially, with a book-to-bill of 1.10; Industrial orders up 47% year over year.
Free cash flow of $608M (down from $674M), with about $615M returned to shareholders via buybacks ($405M) and dividends ($209M).
Q2 FY26 guidance of roughly $4.7B in sales (+13% reported, +6% organic) and adjusted EPS of about $2.65 (+20%).
Total debt increased to $5.7B from $4.2B a year earlier, and beginning in FY26 non-GAAP measures exclude intangible amortization, which flatters adjusted comparisons.

03—Questions

Frequently Asked Questions

What drove the strong first-quarter results?
Growth was led by Industrial Solutions, where reported sales rose 38% to $2.2B, driven by Digital Data Networks (up 71%, tied to AI data center demand) and Energy (up 88% reported, 15% organic, on grid hardening and renewables). Transportation Solutions grew 10% reported to $2.47B, supported by automotive content gains in Asia and Europe and a recovery in commercial transportation. Operating leverage from higher volume lifted adjusted margins in both segments.
How much of the sales growth came from acquisitions and currency rather than the underlying business?
Of the $833M increase in net sales, about $104M came from favorable foreign currency translation and about $152M from acquisitions (mainly the Energy business acquired in the prior year), leaving roughly $577M, or 15% organic growth. Investors should view the organic figure as the better gauge of underlying demand.
Is the company's balance sheet and cash generation still healthy?
Operating cash flow of $865M and free cash flow of $608M support the dividend and buybacks, and cash of $1.25B is on hand. However, total debt rose to about $5.7B from $4.2B a year ago, inventory increased to $2.95B, and free cash flow declined year over year, so working capital and leverage are worth monitoring.
What changed in how TE reports non-GAAP earnings, and why does it matter?
Starting in fiscal 2026, TE excludes amortization expense on intangible assets from its adjusted measures. This adds about $0.15 per share to Q1 adjusted EPS and about $57M to adjusted operating income. Because prior-period adjusted figures were not restated in this release, the change makes year-over-year comparisons less direct, and investors should compare GAAP EPS alongside the adjusted figure.
What does the outlook imply for the rest of fiscal 2026?
For Q2, TE guided to sales of about $4.7B (+13% reported, +6% organic) and adjusted EPS of about $2.65 (+20%), with sequential growth expected in Industrial and seasonal softness in Transportation. Management reiterated expectations for double-digit sales and adjusted earnings growth in Q2 and described FY26 as a year of strong growth and margin expansion, though the release does not give full-year numeric guidance.

04—Continue

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