Amphenol vs. TE Connectivity, Q3 2026: 37% vs 13% organic growth from the same AI demand

Amphenol and TE Connectivity sell the same kind of product: connectors, cables and sensors that carry power and data between parts of a machine. Both just reported the three months to late September 2026, and AI data-center hardware drove both. The difference is size. Amphenol's sales rose 65% to $10.23 billion. TE's rose 11.9% to $5.31 billion.

A note on calendars. TE's fiscal year ends in September, so the quarter that matches Amphenol's Q3 (July–September) is TE's fiscal Q4 2026, the three months to September 25. TE's fiscal Q3 covered April–June. This comparison uses Amphenol's Q3 2026 report and TE's fiscal Q4 2026 report, with TE's fiscal Q3 report as the earlier data point. Every figure below comes from those reports.

Side by side

Organic growth is sales growth with currency moves and acquisitions stripped out. Operating margin is the share of sales left after running the business, before interest and tax.

Same driver, different scale

Amphenol's 65% includes about 28 points from acquisitions, mainly the CommScope connectivity and cable unit bought in January. Even without that, its 37% organic growth was almost three times TE's 13.4%. The gap is clearest in data centers. Amphenol's Communications Solutions segment, now 64% of its sales, grew 51% organically, which the release credits to "IT datacom", its term for servers and networking gear. TE's digital data networks business grew 34.4% organically and added $242 million of sales. That is about 43% of TE's total $563 million increase, by our arithmetic.

Outside data centers the two look more alike. Amphenol's automotive-heavy Interconnect and Sensor Systems segment grew 11% organically. TE's automotive business grew 5.9%, up from under 3% the quarter before. TE's commercial-transportation business grew 17.8%, and Amphenol's defence and industrial segment (Harsh Environment Solutions) grew 29%.

Margins: a 9-point gap that isn't about extra volume

Amphenol keeps about 9 more cents of every sales dollar as operating profit (29.5% against 20.6%). It also starts higher: its gross margin, sales minus the direct cost of goods as a share of sales, is 39.3% against TE's 35.5%.

On the extra sales the two are close. By our arithmetic, Amphenol's operating income rose $1,318.5 million on $4,035.3 million of added sales, or about 33 cents per extra dollar. TE's rose $177 million on $563 million, about 31 cents. The gap between them is the margin each started from, not how much each made on the new volume.

The sources of that margin differ. Amphenol's gross margin slipped from Q2's 40.5%. The improvement came from overhead: selling and administrative costs fell from 10.6% to 9.6% of sales. TE's gross margin widened slightly to 35.5% while both segments' margins rose.

Takeaway: Both companies are riding the same AI data-center build-out, but Amphenol gets more than twice as much growth from it (37% organic against 13.4%) and keeps about 9 more cents of each sales dollar. TE's quarter is smaller but steadier: better cash conversion, a falling share count and less debt to absorb.

Which quarter was higher quality?

Our two reports reach opposite verdicts, and they disagree in a useful way.

Amphenol: understated. GAAP EPS rose 61%, behind the 74% adjusted rate. The cause was a $60 million foreign tax settlement and $15.5 million of deal costs. Nothing flattered the result. Tariff refunds were only about $15 million, the adjusted tax rate was 27.0% in both years, and the share count rose 0.7%. All of the per-share growth came from profit. That is despite interest expense rising to $212.3 million from $80.7 million on the debt that funded CommScope.

TE: flattered. GAAP EPS rose 39%, but pretax income rose 20%. A $59 million tax benefit, worth $0.20 a share, cut the tax rate to 16.3% from 26.0%. The adjusted 21% EPS growth is the fairer figure, and buybacks, $544 million in the quarter, supplied about 2.5 points of it.

Cash points the other way. TE's operating cash flow of $1.53 billion was 1.7 times net income, and its receivables grew roughly in line with sales. Amphenol's operating cash flow ($2,078.5 million) only matched net income. Its free cash flow grew 33.5%, half the rate of profit, because capital spending nearly doubled to $457.2 million and working capital absorbed $415.9 million. Amphenol also carries $17.9 billion of debt after spending $11.1 billion on acquisitions this year.

On balance, Amphenol's quarter is the higher quality at the earnings line: its profit growth is if anything understated, while TE needed a tax gain to look as good as it did on a GAAP basis. TE's is the higher quality in cash.

The outlook: both guide almost flat from here

Both managements guide the October–December quarter only slightly above this one. Amphenol's Q4 guide of $10.3–10.5 billion has a midpoint 1.7% above Q3, after 16.8% sequential growth this quarter. TE's fiscal Q1 2027 guide of about $5.35 billion is 0.7% above its fiscal Q4, though still 15% above a year earlier.

Both have beaten their guidance before. Amphenol beat the top of its range by about $830 million this quarter, and TE beat its own guide by about $60 million. Order books also run ahead of shipments at both, with book-to-bill of 1.19 and about 1.15. A book-to-bill below 1.0 at either company would be the first sign that data-center orders are cooling. Amphenol is the company to watch for it, since data-center demand drives more of its sales.

Source: our published analyses of each company's earnings release (Exhibit 99.1 to Form 8-K, October 28, 2026). This is analysis of public filings, not investment advice.