Amphenol — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported third quarter 2026 net sales of $10.23 billion, a 65% increase in U.S. dollars and 37% organic growth compared to the third quarter of 2025.
• Nine months ended September 30, 2026, net sales totaled $26.61 billion, a 60% increase in U.S. dollars and 34% organic growth compared to the prior year period.
• GAAP diluted earnings per share (EPS) for the quarter were $0.79, up 61% from the prior year; Adjusted diluted EPS were $0.80, up 74% from the prior year.
• For the nine months ended September 30, 2026, GAAP diluted EPS were $1.84, and Adjusted diluted EPS were $2.01.
• GAAP operating margin was 29.5% for the quarter, while Adjusted operating margin was 29.7%.
• Operating cash flow for the quarter was $2.1 billion, and free cash flow was $1.6 billion.
• Total capital returned to shareholders in the quarter was $553 million, comprising $245 million in stock repurchases (3.0 million shares) and $308 million in dividends.
• Cash and cash equivalents balance as of September 30, 2026, was $4.17 billion, down from $11.13 billion at December 31, 2025.
• Long-term debt increased to $17.17 billion as of September 30, 2026, from $14.56 billion at December 31, 2025.

Guidance and Future Outlook:

• Fourth quarter 2026 sales are expected to range from $10.3 billion to $10.5 billion, representing approximately a 60% increase over the prior year quarter.
• Fourth quarter 2026 Adjusted diluted EPS is expected to range from $0.81 to $0.83, a 65% to 69% increase from the fourth quarter of 2025.
• Full year 2026 sales are expected to range from $36.9 billion to $37.1 billion, approximately a 60% increase over the prior year.
• Full year 2026 Adjusted diluted EPS is expected to range from $2.82 to $2.84, approximately a 70% increase over the prior year.
• Guidance excludes the impact of acquisitions not yet closed (AdvancedPCB, Dexgreen, and Humanetics Sensors).
• The CommScope business is now expected to generate full-year 2026 sales of $5.1 billion and be $0.18 accretive to Adjusted diluted EPS, exceeding prior expectations of $4.6 billion in sales and $0.15 accretion.
• Adjusted effective tax rate is expected to be 27.0% for the full year 2026.

Business Segments and Product Lines:

• Communications Solutions: Generated $6.58 billion in third quarter sales (99% U.S. dollar growth, 51% organic growth) and $16.50 billion for the nine months (91% U.S. dollar growth, 47% organic growth). Operating margin was 33.1% for the quarter.
• Harsh Environment Solutions: Generated $2.04 billion in third quarter sales (35% U.S. dollar growth, 29% organic growth) and $5.59 billion for the nine months (32% U.S. dollar growth, 25% organic growth). Operating margin was 30.1% for the quarter.
• Interconnect and Sensor Systems: Generated $1.60 billion in third quarter sales (17% U.S. dollar growth, 11% organic growth) and $4.51 billion for the nine months (19% U.S. dollar growth, 13% organic growth). Operating margin was 20.0% for the quarter.
• Acquisitions: Closed the acquisition of Empire Electronics (Automotive lighting), expected to generate $320 million in full-year 2026 sales. Signed agreements to acquire AdvancedPCB (Defense/Industrial, $270 million full-year 2026 sales), Dexgreen (Communications Networks, $90 million full-year 2026 sales), and Humanetics Sensors (Commercial Air/Defense/Industrial, $70 million full-year 2026 sales).
• AdvancedPCB and Humanetics Sensors acquisitions are expected to close in Q4 2026; Dexgreen is expected to close in Q1 2027.
• Combined purchase price for the four acquisitions is approximately $1.6 billion, to be financed via cash on hand and debt.

Market and Competitive Landscape:

• Strong organic growth was driven by the IT datacom market and other end markets.
• The company cites a revolution in electronics accelerating growth opportunities across diversified end markets.
• Competitive advantage is attributed to an expanded range of high-technology interconnect products and an entrepreneurial culture.
• The company operates in approximately 40 countries with a diversified presence in Automotive, Commercial Aerospace, Communications Networks, Defense, Industrial, Information Technology, and Mobile Devices.

Risks and Challenges:

• Risks include potential failure to complete acquisitions, failure to realize expected benefits, and regulatory approval delays.
• Exposure to political, economic, and military risks in international markets, as well as trade policies, sanctions, and tariffs.
• Potential economic slowdowns or recessions in end markets affecting customer demand.
• Risks associated with raw material availability and increasing costs.
• Cybersecurity threats, including ransomware and AI-driven attacks, could disrupt operations or cause data breaches.
• Risks related to climate change, extreme weather, and sustainability regulations.
• Risks associated with increased debt levels and interest expense following the CommScope acquisition.
• Potential difficulties in integrating acquired businesses, including goodwill impairment.
• Risks related to government contracting, export controls, and intellectual property enforcement.

Management Commentary and Tone:

• Chairman and CEO R. Adam Norwitt expressed pleasure at closing the quarter with record sales and Adjusted Diluted EPS exceeding the high end of guidance.
• Management highlighted strong profitability with Adjusted Operating Margin reaching 29.7%.
• Norwitt stated confidence in the management team's ability to dynamically adjust to market conditions and generate sustainable long-term value.
• The tone reflects optimism regarding the "revolution in electronics" and the company's ability to capitalize on growth opportunities through organic innovation and acquisitions.

Other Key Points:

• The Board approved a 20% increase in the quarterly dividend to $0.15 per share, payable January 13, 2027, to shareholders of record as of December 22, 2026.
• A new three-year, $4 billion stock repurchase program was approved, effective January 1, 2027.
• A 2-for-1 stock split was completed in September 2026, with shares distributed on September 2, 2026, and split-adjusted trading beginning September 3, 2026.
• The existing three-year, $2 billion stock repurchase plan is expected to be completed by December 31, 2026.
• Acquisition-related expenses for the quarter were $15.5 million; for the nine months, they were $155.9 million.
• Discrete tax items for the nine months ended September 30, 2026, totaled $389.0 million, primarily related to foreign tax matters and reassessments of tax rate assumptions in China.