FILE PHOTO: Employees hold a plate with components at TE Connectivity in Woerth, Germany, February 16, 2022. Picture taken February 16, 2022. REUTERS/Lukas Barth/File Photo
(Reuters) -TE Connectivity issued an upbeat forecast for the fourth quarter on Wednesday, following better-than-expected third-quarter profit and revenue results driven by strong demand for its industrial products.
The company's industrial solutions segment makes electrical connector systems and components used in factory automation and other industrial equipment.
Third-quarter sales in the industrial solutions segment surged about 30% year-on-year, bolstered by increased demand for artificial intelligence applications and modern data centers.
CEO Terrence Curtin told Reuters in an interview that the impact of tariffs on overall sales during the third quarter was reduced by half due to price increases and supply chain adjustments.
"When we gave our guidance last quarter, we told our investors that we thought it would be about a 3% impact of sales. It was only 1.5%, so it was about half," Curtin said.
U.S. President Donald Trump's tariffs have weighed on automotive and manufacturing industries, prompting companies to implement mitigation strategies related to pricing and supply chain management.
TE Connectivity expects a 1.5% sales impact from tariffs in the fourth quarter, with its industrial segment expected to bear a greater share of the burden compared to its transportation segment.
The company expects fourth-quarter revenue of about $4.55 billion, exceeding analysts' average estimate of $4.41 billion, according to data compiled by LSEG
Adjusted profit per share for the quarter is projected at $2.27, compared with analysts' expectations of $2.13 per share.
For the third quarter ended June 27, TE Connectivity reported adjusted profit of $2.27 per share, beating analysts' estimates of $2.07.
Revenue for the quarter rose 14% to $4.53 billion, compared with estimates of $4.32 billion.
(Reporting by Anshuman Tripathy in Bengaluru; Editing by Mohammed Safi Shamsi)
