AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 5/6 · 18/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Know-how and customer collaboration support differentiation, but relative superiority and barriers to replication remain unestablished. The uncertain verdict reflects insufficient structural evidence rather than demonstrated interchangeability.
durability · — · Capabilities appear across successive disclosures, but no protected economic duration or sustained advantage over named competitors is demonstrated.
customer dependency · — · Customer collaboration and increased automotive content suggest relevance, but do not establish dependency or material switching costs; backlog is cancellable.
erosion resilience · — · Productivity offsets some pricing pressure, but historical and current erosion prevent establishing resilience of a structural advantage whose existence remains uncertain.
Pricing power50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 1/4 · Pricing is fragile: historical annual erosion of 1%–2% and $46 million of Transportation erosion over nine months outweigh evidence of broad pricing control. The $51 million consolidated first-half benefit demonstrates some successful pricing actions, so outcomes are not uniformly adverse.
retention · 2/4 · Assessed indirectly from customer collaboration, increased content per vehicle despite declining production, and 11.4% consolidated nine-month organic growth. These indicate continuing demand, but do not identify repeat customers or establish retention rates; cancellable orders and quarterly automotive weakness temper the assessment.
margin resilience · 3/4 · Nine-month gross margin improved to 36.5% from 35.3%, and Transportation productivity supported operating-income improvement despite price erosion. Repeated productivity gains demonstrate operating resilience, although fiscal 2025 Transportation weakness shows its limits. This supports resilience rather than proving price-setting power.
contractual freedom · 2/4 · Implemented pricing actions demonstrate some ability to change commercial prices. Generally fixed-price sales, customer rebates and persistent erosion indicate negotiated constraints. The passages do not establish repricing rights or contract duration, supporting only a mixed assessment.
Predictability87
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 50.00
- Revenue growth volatility (pp)
- 5.19
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 2.94
Financial strength81
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 88.89
- netDebtEbitGrade
- 72.35
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 64.47
- Debt / FCF (x)
- 1.78
- Net debt / operating income (x)
- 1.38
- Interest coverage (x)
- 41.70
- Current ratio (x)
- 1.56
Capital allocation93
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 18.47
- 3-year average dilution (%)
- -2.76
- 3-year average SBC / revenue (%)
- 0.81
- cashConversionGrade
- 100.00
Management69
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Actual cash generation, $936 million of fiscal 2025 capital expenditures and lower diluted share counts support financial discipline. However, substantial acquisition spending, new debt issuance and the $1.4 billion acquisition commitment require balancing against incomplete evidence of acquisition returns and repurchase value. Part of cash-flow improvement came from lower tax payments.
incentive alignment · 3/4 · Existing ownership requirements, granted multi-year options and relative-EPS PSUs, and an actual completed PSU performance period demonstrate substantive alignment mechanisms. Actual ownership compliance is unverified, and a discretionary incentive reserve weakens purely formulaic alignment.
execution · 3/4 · Reported organic growth, cash generation and repeated manufacturing productivity improvements demonstrate strong operating execution. Attribution to management is indirect; favorable demand and tax-payment changes contributed, while Transportation price erosion remains an execution challenge.
governance · 3/4 · Entirely independent standing committees, an adopted compensation recovery policy and required auditor-service pre-approval establish substantive governance safeguards. These are disclosed arrangements rather than evidence of exceptional effectiveness or successful enforcement through a crisis.
Evidence
We also rely upon trade secrets, manufacturing know-how, continuing technological innovations, and licensing opportunities to maintain and improve our competitive position.
Business / Intellectual Property · Filed 10/11/2025
As an industry leader, we have established close working relationships with many of our customers.
Business / Customer relationships · Filed 12/11/2024
These relationships allow us to better anticipate and respond to customer needs when designing new products and new technical solutions.
Business / Customer collaboration in product design · Filed 12/11/2024
While we consider our patents and trademarks to be valued assets, we do not believe that our competitive position or our operations are dependent upon or would be materially impacted by any single patent or group of related patents.
Business / Intellectual Property / Patent dependency · Filed 10/11/2025
The industries in which we operate are highly competitive, and we compete with thousands of companies that range from large multinational corporations to local manufacturers.
Business / Competition · Filed 10/11/2025
The Communications Solutions segment’s major competitors include Amphenol, Molex, JST, and Korea Electric Terminal (KET).
Business / Former Communications Solutions segment / Named competitors · Filed 12/11/2024
Overall, our organic net sales growth resulted primarily from increased content per vehicle, partially offset by declines in global vehicle production.
MD&A / Transportation Solutions / Third-quarter automotive organic growth · Filed 24/07/2026
Although pricing actions initiated in recent years have positively impacted our net sales, we have historically experienced price erosion averaging from 1% to 2% each year.
Risk Factors / Historical price erosion and pricing actions · Filed 10/11/2025
Backlog is not necessarily indicative of future net sales as unfilled orders may be cancelled prior to shipment of goods.
Business / Backlog cancellation terms · Filed 10/11/2025
currency translation of 3.4%. Net price erosion negatively affected organic net sales by $46 million in the first nine months of fiscal 2026.
MD&A / Transportation Solutions / Nine-month net price erosion · Filed 24/07/2026
Automotive—Our organic net sales decreased 3.8% in the second quarter of fiscal 2026 as a result of declines of 7.9% in the Americas region and 6.1% in the Asia–Pacific region, partially offset by growth of 1.5% in the EMEA region.
MD&A / Transportation Solutions / Second-quarter automotive organic decline · Filed 24/04/2026
Net pricing actions positively affected organic net sales by $51 million in the first six months of fiscal 2026.
MD&A / Consolidated net sales / First-half realized pricing · Filed 24/04/2026
The following table provides an analysis of the change in our net sales by geographic region: Change in Net Sales for the Quarter Ended June 26, 2026 Change in Net Sales for the Nine Months Ended June 26, 2026 versus Net Sales for the Quarter Ended June 27, 2025 versus Net Sales for the Nine Months Ended June 27, 2025 Net Sales Organic Net Sales Net Sales Organic Net Sales Growth Growth Translation Growth Growth Translation Acquisitions ($ in millions) Asia–Pacific $ 291 17.5 % $ 254 15.3 % $ 37 $ 903 18.8 % $ 813 16.9 % $ 90 $ — EMEA 106 6.9 79 5.2 27 515 12.3 269 6.4 246 — Americas 229 17.2 221 16.5 8 642 18.2 346 9.8 24 272 Total $ 626 13.8 % $ 554 12.2 % $ 72 $ 2,060 16.5 % $ 1,428 11.4 % $ 360 $ 272 Cost of Sales and Gross Margin The following table presents cost of sales and gross margin information: For the For the Quarters Ended Nine Months Ended June 26, June 27, June 26, June 27, 2026 2025 Change 2026 2025 Change ($ in millions) Cost of sales $ 3,325 $ 2,934 $ 391 $ 9,254 $ 8,094 $ 1,160 As a percentage of net sales 64.4 % 64.7 % 63.5 % 64.7 % Gross margin $ 1,835 $ 1,600 $ 235 $ 5,319 $ 4,419 $ 900 As a percentage of net sales 35.6 % 35.3 % 36.5 % 35.3 % 24 Table of Contents Gross margin increased $235 million and $900 million in the third quarter and first nine months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025 due primarily to higher volume and improved manufacturing productivity.
MD&A / Geographic organic growth and consolidated gross margin · Filed 24/07/2026
Excluding the items below, operating income increased in the first nine months of fiscal 2026 primarily as a result of improved manufacturing productivity, partially offset by price erosion.
MD&A / Transportation Solutions / Productivity and price erosion · Filed 24/07/2026
Excluding the items below, operating income decreased in fiscal 2025 primarily as a result of net price erosion.
MD&A / Transportation Solutions / Fiscal 2025 operating-income decline drivers · Filed 10/11/2025
Although products are generally sold at fixed prices, certain distributors and customers receive incentives or awards, such as sales rebates, return allowances, scrap allowances, and other rights, which are accounted for as variable consideration.
Revenue recognition / Fixed prices and customer incentives · Filed 10/11/2025
Net cash provided by operating activities increased $662 million to $4,139 million in fiscal 2025 as compared to $3,477 million in fiscal 2024.
MD&A / Cash Flows from Operating Activities · Filed 10/11/2025
The increase resulted primarily from higher pre-tax income and a reduction in income tax payments.
MD&A / Drivers of operating cash-flow improvement · Filed 10/11/2025
Capital expenditures were $936 million and $680 million in fiscal 2025 and 2024, respectively.
MD&A / Capital expenditures · Filed 10/11/2025
● Returned $2.2 billion to shareholders and deployed $2.6 billion for bolt-on acquisitions to support strategic growth.
Compensation Discussion and Analysis / Fiscal 2025 capital deployment · Filed 15/01/2026
(“TEGSA”), our wholly-owned subsidiary, issued $200 million aggregate principal amount of 4.50% senior notes due in February 2031 and $550 million aggregate principal amount of 4.875% senior notes due in February 2036.
Notes / Debt / Fiscal 2026 senior-note issuance · Filed 24/07/2026
Earnings Per Share The weighted-average number of shares outstanding used in the computations of basic and diluted earnings per share were as follows: For the For the Quarters Ended Nine Months Ended June 26, June 27, June 26, June 27, 2026 2025 2026 2025 (in millions) Basic 291 296 293 298 Dilutive impact of share-based compensation arrangements 2 2 2 2 Diluted 293 298 295 300 16 Table of Contents TE CONNECTIVITY PLC NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued) The following share options were not included in the computation of diluted earnings per share because the instruments’ underlying exercise prices were greater than the average market prices of our ordinary shares and inclusion would be antidilutive: For the For the Quarters Ended Nine Months Ended June 26, June 27, June 26, June 27, 2026 2025 2026 2025 (in millions) Antidilutive share options — 1 — 1 14.
Notes / Earnings Per Share / Basic and diluted share counts · Filed 24/07/2026
Acquisitions On July 22, 2026, we entered into a definitive agreement to acquire Astrodyne TDI, a leading manufacturer of power and filter solutions, for approximately $1.4 billion in cash.
MD&A / Acquisition agreement dated July 22, 2026 · Filed 24/07/2026
Additional market samples are also referenced to meet unique circumstances where appropriate Focus on executive stock ownership – Designed to ensure that our leaders own stock and directly align their long-term financial interests with all other shareholders – The TE Connectivity Stock Ownership and Retention Requirement Plan, together with long-term equity awards, drives executive stock ownership – The CEO is required to hold shares equal to six times his base salary, and the other named executive officers are required to hold shares equal to three times their respective base salaries Simple and transparent – Designed to ensure both our leaders and external stakeholders understand our priorities and expectations – Our executive compensation programs are designed to be readily understood by our executives, and transparent to our investors Fair and Equitable – Designed to deliver fair and equitable pay based on roles and responsibilities and on company and individual performance, regardless of gender, race/ethnicity or any other individual demographics Industry Peer Group As part of its oversight of executive compensation, the MDCC periodically reviews market data to ensure that pay levels, mix, and practices for senior executives remain competitive and aligned with shareholder interests.
Compensation Discussion and Analysis / Executive ownership requirements · Filed 15/01/2026
The following table describes the general terms and conditions of the fiscal 2025 grants: Description Performance Stock Units (PSU) Stock Options (SO) Definition Promise to deliver a share of TE stock at a specified point in the future as long as certain performance metrics are achieved Right to purchase an ordinary share of TE at a future date for a predetermined, fixed price Performance Period 3 Years 4 Years Performance Measure Three-year average Relative Earnings Per Share (EPS) Growth against S&P 500 Non-Financial Index – Award Vesting (% of Target) Threshold (25th) – 50% Target (50th) – 100% Maximum (75th) – 200% – Vesting Cliff Vesting upon the MDCC certification following the third anniversary of the grant date 25% Ratable beginning on or after the first anniversary of the grant date Expiration – 10 years Dividends Dividend Equivalent Units (DEU) vesting on the third anniversary proportional to the PSUs earned Not applicable 2026 Annual General Meeting Proxy Statement 59 Table of Contents Grant of Fiscal 2025 Long-Term Incentive Awards The MDCC granted long-term equity incentive awards for fiscal year 2025 in November 2024.
Compensation Discussion and Analysis / Granted fiscal 2025 long-term award terms · Filed 15/01/2026
Kroeger $ 2,300,000 Mr. Jenkins $ 2,100,000 Payout for Fiscal 2023 PSU Grant Fiscal year 2025 was the third year of our fiscal year 2023 PSU grant and recipients earned shares for the period calculated at 136% of target which reflected the Company’s performance relative to the index over the three-year period.
Compensation Discussion and Analysis / Fiscal 2023 PSU grant payout · Filed 15/01/2026
To conduct its business the Board maintains three standing committees: Audit, Management Development and Compensation, and Nominating, Governance and Compliance Committee, each of which are comprised entirely of independent directors.
Corporate Governance / Independent standing committees · Filed 15/01/2026
Clawbacks and Other Remedies for Potential Misconduct In accordance with the TE Connectivity plc Incentive-Based Compensation Recovery Policy, the Board will seek reimbursement from covered executive officers (which includes our NEOs) for the amount of erroneously awarded compensation (i.e., the amount of incentive-based compensation received that exceeds the amount of incentive-based compensation that otherwise would have been received had it been determined based on restated amounts) resulting from an accounting restatement due to the material noncompliance of the Company with any financial reporting requirement under the securities laws, including any required accounting restatement (i) to correct an error in previously issued financial statements that is material to the previously issued financial statements or (ii) that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period.
Compensation Discussion and Analysis / Adopted compensation recovery policy · Filed 15/01/2026
The independent auditor may not begin any work without confirmation of Audit Committee approval from the Corporate Controller or his/her delegate.
Audit Committee / Auditor service pre-approval policy · Filed 15/01/2026
Excluding the items below, operating income increased in fiscal 2024 due primarily to improved manufacturing productivity.
MD&A / Transportation Solutions / Fiscal 2024 productivity improvement · Filed 10/11/2025
In addition, there is a reserve pool of 10% of the total target annual incentive award pool amount that, with the MDCC’s approval, can be used by the CEO to reward exceptional performance at either the business unit or individual level, regardless of performance results against the established financial measures.
Compensation Discussion and Analysis / Discretionary incentive reserve pool · Filed 15/01/2026
