What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-24 compared with 2026-04-24 · 131 added, 120 removed, 268 unchanged (48% of the section changed)

10 unchanged sentences

Summary of Performance

● Our net sales increased 14.5% and 18.0% in the second quarter and first six months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025 due to sales growth in both the Industrial Solutions and Transportation Solutions segments.

Richards Manufacturing Co.

(“Richards Manufacturing”), which was acquired in the third quarter of fiscal 2025, contributed net sales of $120 million and $227 million in the second quarter and first six months of fiscal 2026, respectively.

On an organic basis, our net sales increased 7.2% and 11.0% in the second quarter and first six months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025.

● Our net sales increased 13.8% and 16.5% in the third quarter and first nine months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025 due to sales growth in both the Industrial Solutions and Transportation Solutions segments.

On an organic basis, our net sales increased 12.2% and 11.4% in the third quarter and first nine months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025.

● Our net sales by segment were as follows:

● Transportation Solutions —Our net sales increased 4.7% and 7.3% in the second quarter and first six months of fiscal 2026, respectively, due primarily to sales increases in the automotive and commercial transportation end markets.

● Industrial Solutions —Our net sales increased 27.0% and 32.2% in the second quarter and first six months of fiscal 2026, respectively, primarily as a result of sales growth in the digital data networks, energy, and automation and connected living end markets.

● In March 2026, our Board of Directors declared a regular quarterly cash dividend of $0.78 per ordinary share, payable on June 12, 2026, to shareholders of record on May 22, 2026.

● Net cash provided by operating activities was $1,812 million in the first six months of fiscal 2026.

In the third quarter of fiscal 2026, we expect our net sales to be approximately $5.0 billion, as compared to $4.5 billion in the third quarter of fiscal 2025.

● Transportation Solutions —Our net sales increased 6.7% and 7.1% in the third quarter and first nine months of fiscal 2026, respectively, due primarily to sales increases in the automotive and commercial transportation end markets.

● Industrial Solutions —Our net sales increased 21.9% and 28.3% in the third quarter and first nine months of fiscal 2026, respectively, primarily as a result of sales growth in the digital data networks, energy, automation and connected living, and aerospace, defense, and marine end markets.

● In June 2026, our Board of Directors approved an interim cash dividend of $0.78 per ordinary share, payable on September 11, 2026, to shareholders of record on August 21, 2026.

● Net cash provided by operating activities was $2,997 million in the first nine months of fiscal 2026.

In the fourth quarter of fiscal 2026, we expect our net sales to be approximately $5.25 billion, as compared to $4.75 billion in the fourth quarter of fiscal 2025.

This increase is due to sales growth in both the Industrial Solutions and Transportation Solutions segments.

Additionally, we expect our sales in both the Industrial Solutions and Transportation Solutions segments to increase in the third quarter of fiscal 2026 as compared to the second quarter of fiscal 2026.

In the third quarter of fiscal 2026, we expect diluted earnings per share from continuing operations to be approximately $2.44 per share.

This outlook reflects the positive impact of foreign currency exchange rates on net sales and earnings per share of approximately $51 million and $0.02 per share, respectively, in the third quarter of fiscal 2026 as compared to the same period of fiscal 2025.

In the fourth quarter of fiscal 2026, we expect diluted earnings per share from continuing operations to be approximately $2.84 per share.

This outlook reflects the negative impact of foreign currency exchange rates on net sales of approximately $10 million in the fourth quarter of fiscal 2026 as compared to the same period of fiscal 2025.

Also, this outlook is based on foreign currency exchange rates and commodity prices that are consistent with current levels.

During the first six months of fiscal 2026, we acquired one business for a cash purchase price of $200 million, net of cash acquired.

It does not include results related to our anticipated acquisition of Astrodyne TDI.

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.

The transaction, which is expected to close by the end of calendar year 2026, is subject to customary regulatory approvals and other closing conditions.

The business will be reported as part of our Industrial Solutions segment.

During the first nine months of fiscal 2026, we acquired one business for a cash purchase price of $200 million, net of cash acquired.

The acquisition includes certain earn-out provisions based on business performance for which we have estimated the acquisition-date fair value to be approximately $150 million.

3 unchanged sentences

Quarters Ended

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Nine Months Ended

($ in millions)

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The following table provides an analysis of the change in our net sales by segment:

Change in Net Sales for the Quarter Ended March 27, 2026

Change in Net Sales for the Six Months Ended March 27, 2026

versus Net Sales for the Quarter Ended March 28, 2025

versus Net Sales for the Six Months Ended March 28, 2025

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

Organic Net Sales

Growth (Decline)

($ in millions)

1 unchanged sentence

Industrial Solutions

Net sales increased $601 million, or 14.5%, in the second quarter of fiscal 2026 as compared to the second quarter of fiscal 2025 due to organic net sales growth of 7.2%, the positive impact of foreign currency translation of 4.4% due to the strengthening of certain foreign currencies, and the positive impact of 2.9% from an acquisition.

Richards Manufacturing, which was acquired in the third quarter of fiscal 2025, contributed net sales of $120 million in the second quarter of fiscal 2026.

Net pricing actions positively affected organic net sales by $45 million in the second quarter of fiscal 2026.

In the first six months of fiscal 2026, net sales increased $1,434 million, or 18.0%, as compared to the first six months of fiscal 2025 due to organic net sales growth of 11.0%, the positive impact of foreign currency translation of 3.6% due to the strengthening of certain foreign currencies, and the positive impact of 3.4% from acquisitions.

Richards Manufacturing contributed net sales of $227 million in the first six months of fiscal 2026.

Net pricing actions positively affected organic net sales by $51 million in the first six months of fiscal 2026.

Net sales increased $626 million, or 13.8%, in the third quarter of fiscal 2026 as compared to the third quarter of fiscal 2025 due to organic net sales growth of 12.2% and the positive impact of foreign currency translation of 1.6% due to the strengthening of certain foreign currencies.

Net pricing actions positively affected organic net sales by $34 million in the third quarter of fiscal 2026.

In the first nine months of fiscal 2026, net sales increased $2,060 million, or 16.5%, as compared to the first nine months of fiscal 2025 due to organic net sales growth of 11.4%, the positive impact of foreign currency translation of 2.9% due to the strengthening of certain foreign currencies, and the positive impact of 2.2% from acquisitions.

Manufacturing Co.

(“Richards Manufacturing”), which was acquired on April 1, 2025, contributed incremental net sales of $227 million in the first six months of fiscal 2026 over the same period in fiscal 2025.

Net pricing actions positively affected organic net sales by $85 million in the first nine months of fiscal 2026.

See further discussion of net sales below under “Segment Results.”

5 unchanged sentences

Approximately 60% of our net sales were invoiced in currencies other than the U.S.

dollar in the first six months of fiscal 2026.

dollar in the first nine months of fiscal 2026.

The following table presents our net sales and the percentage of total net sales by geographic region (1) :

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($ in millions)

1 unchanged sentence

The following table provides an analysis of the change in our net sales by geographic region:

Change in Net Sales for the Quarter Ended March 27, 2026

Change in Net Sales for the Six Months Ended March 27, 2026

versus Net Sales for the Quarter Ended March 28, 2025

versus Net Sales for the Six Months Ended March 28, 2025

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

Organic Net Sales

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Quarters Ended

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($ in millions)

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As a percentage of net sales

Gross margin increased $286 million and $665 million in the second quarter and first six months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025 due primarily to higher volume and improved manufacturing productivity.

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.

We use a wide variety of raw materials in the manufacture of our products.

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Quarters Ended

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We expect to purchase approximately 195 million pounds of copper, 105,000 troy ounces of gold, 1.8 million troy ounces of silver, and 15,000 troy ounces of palladium in fiscal 2026.

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($ in millions)

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Selling, General, and Administrative Expenses.

Selling, general, and administrative expenses increased $82 million and $193 million in the second quarter and first six months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025 due primarily to increased selling expenses to support higher sales levels, higher incentive compensation costs, the negative impact of foreign currency translation, and the release of reserves associated with trade compliance matters in the second quarter of fiscal 2025.

Selling, general, and administrative expenses increased $41 million and $234 million in the third quarter and first nine months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025.

The increase in the third quarter of fiscal 2026 resulted primarily from increased selling expenses to support higher sales levels.

The increase in the first nine months of fiscal 2026 was due primarily to increased selling expenses to support higher sales levels, the negative impact of foreign currency translation, higher incentive compensation costs, and the release of reserves associated with trade compliance matters in fiscal 2025.

Restructuring and Other Charges, Net.

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During fiscal 2026, we initiated a restructuring program to optimize our manufacturing footprint and improve the cost structure of our organization.

We incurred net restructuring charges of $13 million during the first six months of fiscal 2026, of which $6 million related to our fiscal 2026 program.

Annualized cost savings related to the fiscal 2026 actions commenced during the first six months of fiscal 2026 are expected to be approximately $3 million and are expected to be fully realized by the end of fiscal 2027.

We incurred net restructuring charges of $96 million during the first nine months of fiscal 2026, of which $86 million related to our fiscal 2026 program.

Annualized cost savings related to the fiscal 2026 actions commenced during the first nine months of fiscal 2026 are expected to be approximately $58 million and are expected to be fully realized by the end of fiscal 2029.

Cost savings will be reflected primarily in cost of sales and selling, general, and administrative expenses.

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($ in millions)

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(in millions)

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Interest Expense.

Interest expense increased $42 million in the first six months of fiscal 2026 as compared to the first six months of fiscal 2025 due primarily to higher average debt levels and cost of debt.

Interest expense increased $45 million in the first nine months of fiscal 2026 as compared to the first nine months of fiscal 2025 due primarily to higher average debt levels and cost of debt.

Income Taxes.

1 unchanged sentence

Segment Results

Effective at the beginning of the third quarter of fiscal 2026, we realigned a product line within the Transportation Solutions segment.

Prior period results have been recast to conform to the current reporting structure.

See Note 16 to the Condensed Consolidated Financial Statements for additional information regarding the realignment.

Transportation Solutions

1 unchanged sentence

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($ in millions)

1 unchanged sentence

The following table provides an analysis of the change in the Transportation Solutions segment’s net sales by industry end market:

Change in Net Sales for the Quarter Ended March 27, 2026

Change in Net Sales for the Six Months Ended March 27, 2026

versus Net Sales for the Quarter Ended March 28, 2025

versus Net Sales for the Six Months Ended March 28, 2025

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

Organic Net Sales

2 unchanged sentences

Growth (Decline)

($ in millions)

Commercial transportation

Net sales in the Transportation Solutions segment increased $108 million, or 4.7%, in the second quarter of fiscal 2026 from the second quarter of fiscal 2025 due primarily to the positive impact of foreign currency translation of 5.2%.

Net price erosion negatively affected organic net sales by $12 million in the second quarter of fiscal 2026.

Net sales in the Transportation Solutions segment increased $162 million, or 6.7%, in the third quarter of fiscal 2026 from the third quarter of fiscal 2025 due to organic net sales growth of 4.5% and the positive impact of foreign currency translation of 2.2%.

Net price erosion negatively affected organic net sales by $12 million in the third quarter of fiscal 2026.

Our organic net sales by industry end market were as follows:

● 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.

Overall, our organic net sales decreased due primarily to declines in global vehicle production, partially offset by increased content per vehicle.

● Commercial transportation— Our organic net sales increased 17.1% in the second quarter of fiscal 2026 due to growth across all regions.

● Sensors— Our organic net sales decreased 3.0% in the second quarter of fiscal 2026 as a result of declines in transportation applications, partially offset by growth in industrial applications.

In the first six months of fiscal 2026, net sales in the Transportation Solutions segment increased $332 million, or 7.3%, from the first six months of fiscal 2025 due to the positive impact of foreign currency translation of 4.1% and organic net sales growth of 3.2%.

Net price erosion negatively affected organic net sales by $34 million in the first six months of fiscal 2026.

● Automotive— Our organic net sales increased 2.9% in the third quarter of fiscal 2026 as a result of growth of 5.6% in the Asia–Pacific region and 2.6% in the EMEA region, partially offset by declines of 3.8% in the Americas region.

Overall, our organic net sales growth resulted primarily from increased content per vehicle, partially offset by declines in global vehicle production.

● Commercial transportation— Our organic net sales increased 17.8% in the third quarter of fiscal 2026 due to growth across all regions.

● Sensors— Our organic net sales decreased 2.8% in the third quarter of fiscal 2026 resulting from declines in transportation applications, partially offset by growth in industrial applications.

In the first nine months of fiscal 2026, net sales in the Transportation Solutions segment increased $494 million, or 7.1%, from the first nine months of fiscal 2025 due to organic net sales growth of 3.7% and the positive impact of foreign

currency translation of 3.4%.

Net price erosion negatively affected organic net sales by $46 million in the first nine months of fiscal 2026.

Our organic net sales by industry end market were as follows:

● Automotive —Our organic net sales increased 1.3% in the first six months of fiscal 2026 as a result of growth of 2.6% in the EMEA region and 2.4% in the Asia–Pacific region, partially offset by declines of 4.4% in the Americas region.

Overall, our organic net sales growth was due primarily to increased content per vehicle, partially offset by declines in global vehicle production.

● Commercial transportation —Our organic net sales increased 16.7% in the first six months of fiscal 2026 primarily as a result of growth in the Asia–Pacific and EMEA regions.

● Sensors —Our organic net sales decreased 2.7% in the first six months of fiscal 2026 due to declines in transportation applications, partially offset by growth in industrial applications.

● Automotive —Our organic net sales increased 2.0% in the first nine months of fiscal 2026 as a result of growth of 3.5% in the Asia–Pacific region and 2.8% in the EMEA region, partially offset by declines of 4.2% in the Americas region.

Overall, our organic net sales growth was due primarily to increased content per vehicle.

● Commercial transportation —Our organic net sales increased 16.9% in the first nine months of fiscal 2026 as a result of growth across all regions.

● Sensors —Our organic net sales decreased 2.7% in the first nine months of fiscal 2026 due to declines in transportation applications, partially offset by growth in industrial applications.

Operating Income.

1 unchanged sentence

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($ in millions)

1 unchanged sentence

Operating margin

Operating income in the Transportation Solutions segment increased $58 million and $113 million in the second quarter and first six months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025.

Excluding the items below, operating income increased in the second quarter and first six months of fiscal 2026 primarily as a result of improved manufacturing productivity.

Operating income in the Transportation Solutions segment decreased $18 million in the third quarter of fiscal 2026 and increased $95 million in the first nine months of fiscal 2026 as compared to the same periods of fiscal 2025.

Excluding the items below, operating income increased in the third quarter of fiscal 2026 due primarily to improved manufacturing productivity.

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.

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(in millions)

Acquisition and integration costs

Restructuring and other charges, net

3 unchanged sentences

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Nine Months Ended

($ in millions)

3 unchanged sentences

The following table provides an analysis of the change in the Industrial Solutions segment’s net sales by industry end market:

Change in Net Sales for the Quarter Ended March 27, 2026

Change in Net Sales for the Six Months Ended March 27, 2026

versus Net Sales for the Quarter Ended March 28, 2025

versus Net Sales for the Six Months Ended March 28, 2025

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

Organic Net Sales

2 unchanged sentences

Growth (Decline)

($ in millions)

2 unchanged sentences

Aerospace, defense, and marine

In the Industrial Solutions segment, net sales increased $493 million, or 27.0%, in the second quarter of fiscal 2026 as compared to the second quarter of fiscal 2025 due to organic net sales growth of 16.9%, the positive impact of 6.6% from an acquisition, and the positive impact of foreign currency translation of 3.5%.

Richards Manufacturing, which was acquired in the third quarter of fiscal 2025, contributed net sales of $120 million in the second quarter of fiscal 2026.

Net pricing actions positively affected organic net sales by $57 million in the second quarter of fiscal 2026.

In the Industrial Solutions segment, net sales increased $464 million, or 21.9%, in the third quarter of fiscal 2026 as compared to the third quarter of fiscal 2025 due primarily to organic net sales growth of 21.0%.

Net pricing actions positively affected organic net sales by $46 million in the third quarter of fiscal 2026.

Our organic net sales by industry end market were as follows:

● Digital data networks —Our organic net sales increased 46.1% in the second quarter of fiscal 2026 due primarily to growth in artificial intelligence and cloud applications.

● Automation and connected living— Our organic net sales increased 8.2% in the second quarter of fiscal 2026 due primarily to growth in factory automation applications, partially offset by declines in the appliances market.

● Aerospace, defense, and marine— Our organic net sales increased 5.4% in the second quarter of fiscal 2026 primarily as a result of growth in the defense and commercial aerospace markets.

● Energy— Our organic net sales increased 11.2% in the second quarter of fiscal 2026 as a result of growth across all regions.

● Medical— Our organic net sales decreased 3.5% in the second quarter of fiscal 2026 due primarily to our strategic exit of a product line.

Net sales in the Industrial Solutions segment increased $1,102 million, or 32.2%, in the first six months of fiscal 2026 as compared to the first six months of fiscal 2025 due to organic net sales growth of 21.3%, the positive impact of 7.9% from acquisitions, and the positive impact of foreign currency translation of 3.0%.

Richards Manufacturing contributed net sales of $227 million in the first six months of fiscal 2026.

Net pricing actions positively affected organic net sales by $85 million in the first six months of fiscal 2026.

● Digital data networks —Our organic net sales increased 34.0% in the third quarter of fiscal 2026 due primarily to growth in artificial intelligence applications.

● Automation and connected living— Our organic net sales increased 14.3% in the third quarter of fiscal 2026 due primarily to growth in factory automation applications.

● Aerospace, defense, and marine— Our organic net sales increased 11.5% in the third quarter of fiscal 2026 primarily as a result of growth in the defense and commercial aerospace markets.

● Energy— Our organic net sales increased 32.7% in the third quarter of fiscal 2026 with growth across all regions and strength in grid hardening and data center applications.

● Medical— Our organic net sales decreased 7.2% in the third quarter of fiscal 2026 due primarily to reduced demand resulting from supply chain dynamics.

Net sales in the Industrial Solutions segment increased $1,566 million, or 28.3%, in the first nine months of fiscal 2026 as compared to the first nine months of fiscal 2025 due to organic net sales growth of 21.2%, the positive impact of 4.9% from acquisitions, and the positive impact of foreign currency translation of 2.2%.

Richards Manufacturing, which was acquired on April 1, 2025, contributed incremental net sales of $227 million in the first six months of fiscal 2026 over the same period in fiscal 2025.

Net pricing actions positively affected organic net sales by $131 million in the first nine months of fiscal 2026.

Our organic net sales by industry end market were as follows:

● Digital data networks —Our organic net sales increased 57.0% in the first six months of fiscal 2026 primarily as a result of growth in artificial intelligence and cloud applications.

● Automation and connected living— Our organic net sales increased 9.8% in the first six months of fiscal 2026 primarily as a result of growth in factory automation applications.

● Aerospace, defense, and marine— Our organic net sales increased 8.0% in the first six months of fiscal 2026 due primarily to growth in the defense and commercial aerospace markets.

● Energy— Our organic net sales increased 12.7% in the first six months of fiscal 2026 due to growth across all regions.

● Medical— Our organic net sales were flat in the first six months of fiscal 2026 primarily as a result of growth in interventional medical applications, offset by our strategic exit of a product line.

● Digital data networks —Our organic net sales increased 47.7% in the first nine months of fiscal 2026 primarily as a result of growth in artificial intelligence applications.

● Automation and connected living— Our organic net sales increased 11.5% in the first nine months of fiscal 2026 primarily as a result of growth in factory automation applications.

● Aerospace, defense, and marine— Our organic net sales increased 9.2% in the first nine months of fiscal 2026 due primarily to growth in the defense and commercial aerospace markets.

● Energy— Our organic net sales increased 21.5% in the first nine months of fiscal 2026 with growth in all regions and strength in grid hardening and data center applications.

● Medical— Our organic net sales decreased 2.3% in the first nine months of fiscal 2026 primarily as a result of our strategic exit of a product line.

Operating Income.

1 unchanged sentence

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($ in millions)

1 unchanged sentence

Operating margin

Operating income in the Industrial Solutions segment increased $148 million and $366 million in the second quarter and first six months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025.

Excluding the items below, operating income increased in the second quarter and first six months of fiscal 2026 primarily as a result of higher volume.

Operating income in the Industrial Solutions segment increased $142 million and $508 million in the third quarter and first nine months of fiscal 2026, respectively, as compared to the same periods of fiscal 2025.

Excluding the items below, operating income increased in the third quarter and first nine months of fiscal 2026 primarily as a result of higher volume.

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(in millions)

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We may also use excess cash and other funding to make strategic acquisitions.

We intend to fund the anticipated acquisition of Astrodyne TDI with a combination of available cash and the issuance of commercial paper and, if necessary, borrowing under our existing credit facility and/or new debt financing.

The cost or availability of future funding may be impacted by financial market conditions.

2 unchanged sentences

Cash Flows from Operating Activities

In the first six months of fiscal 2026, net cash provided by operating activities increased $281 million to $1,812 million from $1,531 million in the first six months of fiscal 2025.

In the first nine months of fiscal 2026, net cash provided by operating activities increased $279 million to $2,997 million from $2,718 million in the first nine months of fiscal 2025.

The increase resulted primarily from higher pre-tax income, partially offset by the impact of changes in working capital levels and an increase in income tax payments.

The amount of income taxes paid, net of refunds, during the first six months of fiscal 2026 and 2025 was $223 million and $164 million, respectively.

The amount of income taxes paid, net of refunds, during the first nine months of fiscal 2026 and 2025 was $353 million and $184 million, respectively.

Cash Flows from Investing Activities

Capital expenditures were $528 million and $435 million in the first six months of fiscal 2026 and 2025, respectively.

Capital expenditures were $832 million and $665 million in the first nine months of fiscal 2026 and 2025, respectively.

We expect fiscal 2026 capital spending levels to be approximately 6% of net sales.

We believe our capital funding levels are adequate to support new programs, and we continue to invest in our manufacturing infrastructure to further enhance productivity and manufacturing capabilities.

During the first six months of fiscal 2026, we acquired one business for a cash purchase price of $200 million, net of cash acquired.

We acquired two businesses for a combined cash purchase price of $321 million, net of cash acquired, during the first six months of fiscal 2025.

During the first nine months of fiscal 2026, we acquired one business for a cash purchase price of $200 million, net of cash acquired.

We acquired Richards Manufacturing for approximately $2.3 billion, net of cash acquired, during the first nine months of fiscal 2025.

Also during the first nine months of fiscal 2025, we acquired two additional businesses for a combined cash purchase price of $321 million, net of cash acquired.

See Note 3 to the Condensed Consolidated Financial Statements for additional information regarding acquisitions.

Cash Flows from Financing Activities and Capitalization

Total debt at March 27, 2026 and September 26, 2025 was $5,655 million and $5,694 million, respectively.

Total debt at June 26, 2026 and September 26, 2025 was $5,632 million and $5,694 million, respectively.

See Note 7 to the Condensed Consolidated Financial Statements for additional information regarding debt.

During the second quarter of fiscal 2026, Tyco Electronics Group S.A.

During the first nine months of fiscal 2026, Tyco Electronics Group S.A.

(“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.

1 unchanged sentence

The new notes are TEGSA’s unsecured senior obligations and rank equally in right of payment with all existing and any future senior indebtedness of TEGSA and senior to any subordinated indebtedness that TEGSA may incur.

During the second quarter of fiscal 2026, TEGSA repaid, at maturity, $500 million of 4.50% senior notes and $350 million of 3.70% senior notes, both due in February 2026.

At March 27, 2026, TEGSA had $100 million of commercial paper outstanding at a weighted-average interest rate of 4.0%.

During the first nine months of fiscal 2026, TEGSA repaid, at maturity, $500 million of 4.50% senior notes and $350 million of 3.70% senior notes, both due in February 2026.

At June 26, 2026, TEGSA had $100 million of commercial paper outstanding at a weighted-average interest rate of 3.95%.

TEGSA had no commercial paper outstanding at September 26, 2025.

1 unchanged sentence

The Credit Facility matures in February 2031 and contains provisions that allow for incremental commitments of up to $1.0 billion, subject to terms and conditions in the Credit Facility.

TEGSA had no borrowings under the Credit Facility at March 27, 2026 or the Replaced Credit Facility at September 26, 2025.

TEGSA had no borrowings under the Credit Facility at June 26, 2026 or the Replaced Credit Facility at September 26, 2025.

Borrowings under the Credit Facility bear interest at a rate per annum equal to, at the option of TEGSA, (1) with respect to borrowings in U.S.

5 unchanged sentences

None of our covenants are presently considered restrictive to our operations.

As of March 27, 2026, we were in compliance with all of our debt covenants and believe that we will continue to be in compliance with our existing covenants for the foreseeable future.

June 26, 2026, we were in compliance with all of our debt covenants and believe that we will continue to be in compliance with our existing covenants for the foreseeable future.

In addition to the Credit Facility, TEGSA is the borrower under our senior notes and commercial paper.

Payment obligations under TEGSA’s senior notes, commercial paper, and Credit Facility are fully and unconditionally guaranteed on an unsecured basis by TEGSA’s parent, TE Connectivity Switzerland Ltd., and its parent, TE Connectivity plc.

Payments of ordinary share dividends to shareholders were $417 million and $382 million in the first six months of fiscal 2026 and 2025, respectively.

In March 2026, our Board of Directors declared a regular quarterly cash dividend of $0.78 per ordinary share, payable on June 12, 2026, to shareholders of record on May 22, 2026.

In the second quarter of fiscal 2026, our Board of Directors authorized an increase of $3.0 billion in our share repurchase program.

Payments of ordinary share dividends to shareholders were $643 million and $594 million in the first nine months of fiscal 2026 and 2025, respectively.

In June 2026, our Board of Directors approved an interim cash dividend of $0.78 per ordinary share, payable on September 11, 2026, to shareholders of record on August 21, 2026.

During the first nine months of fiscal 2026, our Board of Directors authorized an increase of $3.0 billion in our share repurchase program.

Ordinary shares repurchased under the share repurchase program were as follows:

Six Months Ended

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(in millions)

1 unchanged sentence

Repurchase value

At March 27, 2026, we had $3.6 billion of availability remaining under our share repurchase authorization.

At June 26, 2026, we had $3.0 billion of availability remaining under our share repurchase authorization.

Summarized Guarantor Financial Information

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Total noncurrent liabilities (2)

(1) Includes $4,531 million and $2,444 million as of March 27, 2026 and September 26, 2025, respectively, of intercompany loans receivable from non-guarantor subsidiaries.

(2) Includes $4,401 million and $5,001 million as of March 27, 2026 and September 26, 2025, respectively, of intercompany loans payable to non-guarantor subsidiaries.

Six Months Ended

(1) Includes $4,479 million and $2,444 million as of June 26, 2026 and September 26, 2025, respectively, of intercompany loans receivable from non-guarantor subsidiaries.

(2) Includes $5,094 million and $5,001 million as of June 26, 2026 and September 26, 2025, respectively, of intercompany loans payable to non-guarantor subsidiaries.

Nine Months Ended

Fiscal Year Ended

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We do not expect that these uncertainties will have a material adverse effect on our results of operations, financial position, or cash flows.

At March 27, 2026, we had outstanding letters of credit, letters of guarantee, and surety bonds of $251 million to support normal business activities.

At June 26, 2026, we had outstanding letters of credit, letters of guarantee, and surety bonds of $277 million to support normal business activities.

Commitments and Contingencies

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Trade Compliance Matters

As part of our ongoing internal compliance activities, we have been investigating compliance with relevant country of origin for import matters and recently made a voluntary disclosure to the U.S.

Customs and Border Protection Agency regarding potential Section 301 unpaid duties, fees, and interest for certain imported products into the U.S.

We are unable to predict the timing and final outcome of investigation into this matter.

An unfavorable outcome may include unpaid duties, fees, interest, and penalties imposed in response to our disclosures.

Based on currently available information, we have reserved an aggregate of $27 million related to this exposure.

The investigation into this matter has yet to be completed and the final outcome of such investigation and related duties, fees, interest, and potential penalties may differ from amounts currently reserved.

As previously reported, as part of our ongoing internal compliance activities, we conducted an investigation related to country of origin for import matters.

During the third quarter of fiscal 2026, we filed a perfected prior disclosure to the U.S.

Customs and Border Protection Agency (“CBP”) regarding Section 301 unpaid duties, fees, and interest for certain imported products into the U.S.

and paid $14 million to CBP to resolve this matter.

Although CBP has not yet completed its review of the disclosure, we do not expect that the outcome of the review will have a material effect on our results of operations, financial position, or cash flows.

Critical Accounting Policies and Estimates

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Our accounting policies for revenue recognition, goodwill and other intangible assets, income taxes, and pension plans are based on, among other things, judgments and assumptions made by management.

For additional information regarding these policies and the underlying accounting assumptions and estimates used in these policies, refer to “Part II.

For additional information

regarding these policies and the underlying accounting assumptions and estimates used in these policies, refer to “Part II.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” and the Consolidated Financial Statements and accompanying notes contained in our Annual Report on Form 10-K for the fiscal year ended September 26, 2025.

There were no significant changes to this information during the first six months of fiscal 2026.

There were no significant changes to this information during the first nine months of fiscal 2026.

Non-GAAP Financial Measure

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● global risks of business interruptions due to natural disasters or other disasters which have impacted and could continue to negatively impact our results of operations as well as customer behaviors, business, and manufacturing operations as well as our facilities and the facilities of our suppliers, and other aspects of our business;

● global risks of political, economic, and military instability, including the continuing military conflicts in certain parts of the world, and volatile and uncertain economic conditions and the evolving regulatory system in China;

● global risks of political, economic, and military instability, including the continuing military conflicts in certain parts of the world and any resulting supply chain or other disruptions, and volatile and uncertain economic conditions and the evolving regulatory system in China;

● risks associated with cybersecurity incidents and other disruptions to our information technology infrastructure, including as a result of artificial intelligence;

● risks related to compliance with current and future environmental and other laws and regulations, including those related to climate change;

● risks related to the increasing scrutiny and expectations regarding environmental, social, and governance matters;

● risks related to scrutiny and expectations regarding environmental, social, and governance matters;

● risks associated with compliance with applicable antitrust or competition laws or applicable trade regulations;

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● our ability to operate within the limitations imposed by our debt instruments;

● the possible effects on us of various non-U.S.

legislative proposals and other initiatives that could materially increase our worldwide corporate effective tax rate, increase global cash taxes, and negatively impact our U.S.

● the possible effects on us of various global legislative proposals and other initiatives that could materially increase our worldwide corporate effective tax rate, increase global cash taxes, and negatively impact our U.S.

government contracts business;

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis