Slide 1: TE Connectivity Third Quarter 2024 Earnings
TE Connectivity Third Quarter 2024 Earnings July 24, 2024 EVERY CONNECTION COUNTS
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures Forward-Looking Statements (“COVID-19”) negatively affecting our business operations; business, economic, This presentation contains certain "forward-looking statements" within the competitive and regulatory risks, such as conditions affecti
Slide 3: Earnings Highlights
Earnings Highlights 8% Adjusted EPS growth Y/Y in Q3 driven by Adjusted Operating Margin expansion of 200bps Q3 Sales in line with guidance at $4B Down 1% reported and up 2% on an organic basis Y/Y Orders of $4.1B, up Y/Y and sequentially driven by momentum in Artificial Intelligence programs
Slide 4: Segment Orders Summary
Segment Orders Summary ($ in millions) FY23 FY24 FY24 Q3 Growth Reported Q3 Q2 Q3 Y/Y Q/Q Transportation benefiting from continued strong Transportation 2,374 2,288 2,194 (8)% (4)% backlog position in Auto; sequential order declines primarily driven by the Commercial Transportation and Sensor end
Slide 5: Transportation Solutions
Transportation Solutions $ in Millions Automotive Q3 SALES Q3 BUSINESS PERFORMANCE Organic growth in China partially offset by declines in North America & Europe. Reported Y/Y Growth Reported Organic Rates Performance driven by our Down 4% leading global position in $2,433 $2,330 Automotive $1,727
Slide 6: Industrial Solutions
Industrial Solutions $ in Millions Industrial Equipment Decline driven by continued Q3 SALES Q3 BUSINESS PERFORMANCE impact of destocking in our customers’ supply chain Reported Y/Y Growth Reported Organic AD&M Down 1% Rates Organic growth reflects $1,141 $1,133 Industrial $353 (17)% (24)% Equip
Slide 7: Communications Solutions
Communications Solutions $ in Millions Data & Devices Q3 SALES Q3 BUSINESS PERFORMANCE Strong Y/Y growth driven primarily by momentum in Reported AI applications Up 22% Y/Y Growth Rates Reported Organic $516 Data & Devices $329 31% 32% Appliances Organic $424 Organic growth driven by Up 24% Appl
Slide 8: Q3 Financial Summary
Q3 Financial Summary ($ in Millions, except per share amounts) Q3 FY23 Q3 FY24 Net Sales $ 3,998 $ 3,979 Operating Income $ 630 $ 755 Operating Margin 15.8% 19.0% Acquisition-Related Charges 9 5 Restructuring & Other Charges, Net 53 6 Adjusted Operating Income $ 692 $ 766 Adjusted Operating Margin 1
Slide 9: Q3 Financial Performance
Q3 Financial Performance SALES ADJUSTED OPERATING MARGIN $ in Billions 200bps of Organic margin sales up 2% expansion $4.0 $4.0 19.3% 17.3% Q3 2023 Q3 2024 Q3 2023 Q3 2024 ADJUSTED EPS FREE CASH FLOW $ in Millions Up 36% Y/Y Up 8% Y/Y driven by $1,980 $1.77 $1.91 margin $1,459 expansion Q3 2023 Q3 2
Slide 10: Additional Information
Additional Information EVERY CONNECTION COUNTS
Slide 11: Y/Y Q3 2024 Sales and Adjusted EPS
Y/Y Q3 2024 Sales Adjusted EPS (in millions) Q3 2023 Results $3,998 $1.77 Operational Performance 61 0.32 FX Impact (80) (0.06) Tax Rate Impact - (0.12) Q3 2024 Results $3,979 $1.91 11 Adjusted Earnings Per Share is a non-GAAP financial measure; see Appendix for description and reconciliation.
Slide 12: Y/Y Q4 2024 Sales and Adjusted EPS
Y/Y Q4 2024 Sales Adjusted EPS (in millions) Q4 2023 Results $4,035 $1.78 Operational Performance 21 0.26 FX Impact (56) (0.03) Tax Rate Impact - (0.07) Q4 2024 Guidance $4,000 $1.94 12 Adjusted Earnings Per Share is a non-GAAP financial measure; see Appendix for description and reconciliation.
Slide 13: Q3 Balance Sheet and Cash Flow Summary
Q3 Balance Sheet and Cash Flow Summary Free Cash Flow and Working Capital Liquidity, Cash and Debt ($ in Millions) Q3 2023 Q3 2024 ($ in Millions) Q3 2023 Q3 2024 Cash from Operating Activities $779 $1,006 Beginning Cash Balance $905 $1,176 Free Cash Flow 614 867 Capital expenditures, net (165) (139
Slide 14: Appendix
Appendix EVERY CONNECTION COUNTS
Slide 15: Non-GAAP Financial Measures
Non-GAAP Financial Measures We present non-GAAP performance and liquidity measures as Organic Net Sales Growth (Decline) – represents net sales Adjusted Income Tax (Expense) Benefit and Adjusted we believe it is appropriate for investors to consider adjusted growth (decline) (the most comparable
Slide 16: Non-GAAP Financial Measures (cont.)
Non-GAAP Financial Measures (cont.) Adjusted EBITDA and Adjusted EBITDA Margin – property, plant, and equipment. These items are subtracted represent net income and net income as a percentage of net because they represent long-term commitments. In the sales, respectively, (the most comparable GAAP
Slide 17: Segment Summary
Segment Summary For the Quarters Ended For the Nine Months Ended June 28, June 30, June 28, June 30, 2024 2023 2024 2023 ($ in millions) Net Sales Net Sales Net Sales Net Sales Transportation Solutions $ 2,330 $ 2,433 $ 7,087 $ 7,175 Industrial Solutions 1,133 1,141 3,301 3,392 Communications Soluti
Slide 18: Reconciliation of Net Sales Growth
Reconciliation of Net Sales Growth Change in Net Sales for the Quarter Ended June 28, 2024 versus Net Sales for the Quarter Ended June 30, 2023 Net Sales Organic Net Sales Acquisition/ Growth (Decline) Growth (Decline) (1) Translation (2) (Divestiture) ($ in millions) Transportation Solutions (3): A
Slide 19: Reconciliation of Non-GAAP Measures, Quarter Ended June 2024
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended June 28, 2024 Adjustments Acquisition- Restructuring Related and Other Adjusted (1) (1) U.S. GAAP Charges Charges, Net (Non-GAAP) (2) ($ in millions, except per share data) Operating income: Transportation
Slide 20: Reconciliation of Non-GAAP Measures, Quarter Ended June 2023
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended June 30, 2023 Adjustments Acquisition- Restructuring Related and Other Adjusted U.S. GAAP Charges (1) Charges, Net (1) (Non-GAAP) (2) ($ in millions, except per share data) Operating income: Transportation
Slide 21: Reconciliation of Non-GAAP Measures, Nine Months Ended June 2024
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Nine Months Ended June 28, 2024 Adjustments Acquisition- Restructuring Related and Other Adjusted (1) (1) (2) U.S. GAAP Charges Charges, Net Tax Items (Non-GAAP) (3) ($ in millions, except per share data) Operating inco
Slide 22: Reconciliation of Non-GAAP Measures, Nine Months Ended June 2023
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Nine Months Ended June 30, 2023 Adjustments Acquisition- Restructuring Related and Other Adjusted (1) (1) U.S. GAAP Charges Charges, Net (Non-GAAP) (2) ($ in millions, except per share data) Operating income: Transporta
Slide 23: Reconciliation of Non-GAAP Measures, Quarter Ended September 2023
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended September 29, 2023 Adjustments Acquisition- Restructuring Related and Other Adjusted (1) (1) (2) U.S. GAAP Charges Charges, Net Tax Items (Non-GAAP) (3) ($ in millions, except per share data) Operating inc
Slide 24: Reconciliation of Non-GAAP Measures, Year Ended September 2023
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Year Ended September 29, 2023 Adjustments Acquisition- Restructuring Related and Other Adjusted U.S. GAAP Charges (1) Charges, Net (1) Tax Items (2) (Non-GAAP) (3) ($ in millions, except per share data) Operating income
Slide 25: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow For the Quarters Ended For the Nine Months Ended June 28, June 30, June 28, June 30, 2024 2023 2024 2023 (in millions) Net cash provided by operating activities $ 1,006 $ 779 $ 2,435 $ 1,994 Net cash used in investing activities (117) (169) (744) (573) Net cash used
Slide 26: Reconciliation of Adjusted EBITDA and Adjusted EBITDA Margin
Reconciliation of Adjusted EBITDA and Adjusted EBITDA Margin For the Quarters Ended June 28, June 30, 2024 2023 ($ in millions) Net income $ 573 $ 528 Income tax expense 181 96 Other expense, net 3 4 Interest expense 18 20 Interest income (20) (18) Operating income 755 630 Acquisition-related charge
Slide 27: Reconciliation of Forward-Looking Non-GAAP Financial Measures
Reconciliation of Forward-Looking Non-GAAP Financial Measures to Forward-Looking GAAP Financial Measures Outlook for Quarter Ending September 27, Outlook for 2024 (1) Fiscal 2024 (1) Diluted earnings per share from continuing operations $ 1.80 $ 11.22 Restructuring and other charges, net 0.12 0.31 A