TE Connectivity (TEL) Q2 2026 earnings summary

Executive summary

• Q2 FY26 net sales reached $4.74 billion, up 15% year-over-year (7% organic), with strong growth in both Industrial and Transportation segments, and significant contribution from acquisitions.

• Record orders of $5.3 billion, up 25% year-over-year, with double-digit growth across all businesses and regions; book-to-bill ratio at 1.12.

• Adjusted EPS hit a record $2.73, up 24% year-over-year; GAAP diluted EPS was $2.90.

• Free cash flow for the first half was $1.3 billion, up 17% year-over-year; $1.2 billion returned to shareholders and a 10% dividend increase announced.

• Strategy leverages AI, data, and power proliferation, driving sustained margin expansion and double-digit earnings growth.

Financial highlights

• Net sales for Q2 FY26: $4.74 billion, up from $4.14 billion in Q2 FY25.

• Adjusted operating income: $1.03 billion (21.7% margin); GAAP operating income: $954 million (20.1% margin).

• Adjusted EBITDA for Q2 FY26 was $1.22 billion, with a margin of 25.6%.

• Free cash flow for the first half: $1.3 billion, up from $1.1 billion year-over-year.

• Adjusted effective tax rate for Q2 FY26: 20.9%; GAAP effective tax rate: 9.2% due to a tax benefit.

Outlook and guidance

• Q3 FY26 sales expected at ~$5.0 billion, up 10% year-over-year (9% organic), with sequential and year-over-year growth in both segments.

• Adjusted EPS guidance for Q3 FY26: ~$2.83, up 17% year-over-year; GAAP EPS expected at ~$2.44.

• Full-year tax rate expected at approximately 22%.

• Guidance reflects positive foreign currency impact and stable commodity prices.

• Over $2 billion of growth anticipated for the year, ahead of through-cycle targets.