Amphenol Forecasts Further Growth After Communications-Led Quarter
Orders reached a record $10.7 billion as demand continued to outpace sales.
Amphenol (APH), the electronic-connector maker, reported a 55% increase in second-quarter sales as its Communications Solutions business and recent acquisitions drove growth. Organic sales rose 30%.
Sales reached $8.76 billion, about 15% above the first quarter, though reported and organic growth moderated from 58% and 33%, respectively. The result exceeded Amphenol’s prior sales guidance by roughly $558 million to $658 million.
Adjusted diluted earnings rose 67% from a year earlier to $1.35 a share, up from $1.06 in the first quarter and at least $0.19 above the company’s previous forecast. GAAP earnings increased 59% to $1.37 a share. Adjusted operating margin widened to 29.8% from 27.3% sequentially and 25.6% a year earlier, helped by an $80 million tariff recovery that added $0.04 a share.
Communications Solutions sales climbed 85% to $5.38 billion, including 42% organic growth and a 42% contribution from acquisitions. Its operating margin expanded to 33.6% from 30.6%. Harsh Environment Solutions sales increased 28% to $1.86 billion, while Interconnect and Sensor Systems sales rose 17% to $1.52 billion; margins also improved in both segments.
Orders increased about 14% from the first quarter to $10.7 billion, while the book-to-bill ratio edged down to 1.23 from 1.24. Operating cash flow rose 10% to $1.56 billion and free cash flow increased about 8% to $1.21 billion, even as capital expenditures grew about 20% to $355.5 million.
Amphenol raised its 2026 expectations for the acquired CommScope business to $4.6 billion in sales and $0.30 a share of adjusted earnings accretion, up from $4.1 billion and $0.15 a share. The company also completed its purchases of El.Com and Wilder Technologies, businesses with about $150 million and $15 million in annual sales, respectively.
The company expects third-quarter sales of $9.3 billion to $9.4 billion and adjusted earnings of $1.40 to $1.42 a share, representing sequential increases of about 6% to 7% and 4% to 5%, respectively. That forecast excludes the second quarter’s tariff-recovery benefit and incorporates a higher 27% adjusted tax rate following tax developments in China and a shift in income toward higher-tax jurisdictions.
Amphenol returned $515 million to shareholders during the quarter, up from nearly $485 million in the first quarter, as share repurchases increased to $208 million and dividends held at $307 million.