TE Connectivity : Q1 2025 TE Connectivity Ltd. Earnings Conference Call

Published: 2025-01-22 06:24:04 ET TEL

TE Connectivity

First Quarter

2025 Earnings

January 22, 2025

EVERY CONNECTION COUNTS

Earnings Highlights

Record Adjusted Operating Margins; Q1 EPS Above Guidance Driven by Strong Operational Performance

Q2 Guidance

3

Organic Net Sales Growth (Decline), Adjusted Operating Margin, Adjusted EPS, and Free Cash Flow are non-GAAP financial measures; see Appendix for descriptions and reconciliations

Segment Orders Summary

($ in millions)

Reported

FY24

FY24

FY25

Q1 Growth

Q1

Q4

Q1

Y/Y

Q/Q

Transportation

2,268

2,224

2,151

(5)%

(3)%

Industrial

1,505

1,617

1,860

24%

15%

Total TE

3,773

3,841

4,011

6%

4%

Book to Bill

0.98

0.94

1.05

Order patterns supporting growth outlook

4

Transportation Solutions

$ in Millions

Q1 SALES

Reported

Down 6%

$2,393$2,243

Organic

Down 5%

Q1 2024

Q1 2025

Q1 ADJUSTED OPERATING MARGIN

Continued strong

operational execution

21.1%

21.3%

in a dynamic market

environment

Q1 2024

Q1 2025

Adjusted EBITDA Margin

26.0%

26.3%

Q1 BUSINESS PERFORMANCE

Y/Y Growth Rates

Reported

Organic

Automotive

$1,722

(4)%

(3)%

Commercial

312

(12)%

(12)%

Transportation

Sensors

209

(13)%

(13)%

Transportation

$2,243

(6)%

(5)%

Solutions

Strong margin performance; expect sequential organic sales growth in

Q2 despite lower auto production

5

Organic Net Sales Growth (Decline), Adjusted Operating Margin, and Adjusted EBITDA Margin are non-GAAP financial measures; see Appendix for descriptions and reconciliations.

Industrial Solutions

$ in Millions

Q1 SALES

Reported

Up 11%

Organic

$1,438

$1,593

Up 9%

Q1 2024

Q1 2025

Q1 ADJUSTED OPERATING MARGIN

Margin expansion of

100bps driven by higher

16.8%

volume and strong

15.8%

operational performance

Q1 2024

Q1 2025

Adjusted EBITDA Margin

21.0%

21.4%

Q1 BUSINESS PERFORMANCE

Y/Y Growth

Reported

Organic

Rates

Digital Data

$413

48%

48%

Networks (DDN)

Automation

& Connected

479

3%

(5)%

Living (ACL)

Aerospace,

Defense and

334

15%

15%

Marine (AD&M)

Energy

216

5%

7%

Medical

151

(25)%

(25)%

Industrial

$1,593

11%

9%

Solutions

Expect sequential organic sales growth in

Q2 in all businesses

6

Organic Net Sales Growth (Decline), Adjusted Operating Margin, and Adjusted EBITDA Margin are non-GAAP financial measures; see Appendix for descriptions and reconciliations.

Q1 Financial Summary

7

($ in Millions, except per share amounts)

Q1 FY24

Q1 FY25

Net Sales

$

3,831

$

3,836

Operating Income

$

698

$

690

Operating Margin

18.2%

18.0%

Acquisition-Related Charges

8

5

Restructuring & Other Charges, Net

25

50

Adjusted Operating Income

$

731

$

745

Adjusted Operating Margin

19.1%

19.4%

Earnings Per Share*

$

5.76

$

1.75

Acquisition-Related Charges

0.02

0.01

Restructuring & Other Charges, Net

0.05

0.14

Tax Items

(3.99)

0.04

Adjusted EPS

$

1.84

$

1.95

Adjusted Effective Tax Rate

21.2%

23.0%

*Represents Diluted Earnings Per Share from Continuing Operations

Adjusted Operating Income, Adjusted Operating Margin, Adjusted Earnings Per Share, and Adjusted Effective Tax Rate are non-GAAP financial measures; see Appendix for descriptions and reconciliations.

Q1 Financial Performance

SALES

$ in Billions

Organic sales

ADJUSTED OPERATING MARGIN

30bps of

$3.8$3.8

flat Y/Y

19.1%

19.4%

margin

expansion

Q1 2024

Q1 2025

ADJUSTED EPS

Q1 2024

Q1 2025

FREE CASH FLOW

$1.84$1.95

Up 6% Y/Y

$ in Millions

$570

$674

Up 18%

Y/Y

Q1 2024

Q1 2025

Q1 2024

Q1 2025

Margin Expansion and EPS Growth Driven by Strong Operational Performance

Record Q1 Free Cash Flow

8

Adjusted Operating Margin, Adjusted Earnings Per Share, and Free Cash Flow are non-GAAP financial measures; see Appendix for descriptions and reconciliations.

Additional Information

EVERY CONNECTION COUNTS

Y/Y Q1 2025

Sales

Adjusted EPS

(in millions)

Q1 2024 Results

$3,831

$1.84

Operational Performance

23

0.12

FX Impact

(18)

0.03

Tax Rate Impact

-

(0.04)

Q1 2025 Results

$3,836

$1.95

10

Adjusted Earnings Per Share is a non-GAAP financial measure; see Appendix for description and reconciliation.

Disclaimer

TE Connectivity plc published this content on January 22, 2025, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on January 22, 2025 at 11:23:03.693.