What AI Slowdown? TE Connectivity Earnings were Rock Solid and the Stock's Up.

Dow Jones07-22 19:29

There is no AI slowdown, as far as TE Connectivity is concerned.

The maker of electrical components reported better-than-expected fiscal third-quarter earnings and provided solid guidance. Shares were up in early trading, which is a relief.

For the quarter, TE announced earnings per share of $2.94 from sales of $5.2 billion. Wall Street was looking for $2.85 and $5 billion, respectively. A year ago, TE reported earnings per share of $2.27 from sales of $4.5 billion.

The company's data center business topped $800 million, up $100 million quarter over quarter and up 32% year over year.

Orders were $5.7 billion, up $1.2 billion year over year. "Order momentum gives confidence not only near term, but... building on these trends into next year," said CEO Terrence Curtin, adding that growth was pickup un in all business, including industrial and heavy-duty truck end markets.

For the fiscal fourth quarter, TE guided to earnings per share of $3.05 from sales of $5.3 billion. Wall Street currently projects $2.97 and $5.2 billion, respectively.

It's a solid quarter. TE stock was up 2% at $213.10 in premarket trading while S&P 500 and Dow Jones Industrial Average futures were down 0.3% and 0.1%, respectively.

Solid quarters don't always lead to stock gains. Coming into Wednesday trading, TE Connectivity stock was down about 8% year-to-date.

Shares fell 9.1% after the company reported fiscal second-quarter earnings in April. TE beat earnings expectations and provided solid guidance, just like this quarter. Jefferies analyst Stephen Volkmann called results "solid" and reiterated his Buy rating after earnings.

Still, investors were nervous. Valuation didn't seem to be the issue. TE stock was trading for about 21 times earnings expected over the coming 12 months, a discount to the S&P 500 multiple of about 22 times.

Now, TE trades for about 17 times earnings. Lower valuations can take some of the risk out of earnings reports.

Write to Al Root at allen.root@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

July 22, 2026 07:29 ET (11:29 GMT)

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What AI Slowdown? TE Connectivity Earnings were Rock Solid and the Stock's Up.

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