TE Connectivity plc Jefferies Global Industrials Conference 2026

No, thanks, Alex, and I appreciate everybody being here to learn more about TE Connectivity, so let's get into it.

Sure. First off, thank you again. Just to frame where Alex was going, when we look at TE, it's important to understand that we play at the intersection where you need data connectivity as well as power connectivity. Our biggest growth driver both this year and last year really has to do with where we work with semiconductor companies and hyperscalers on how you connect GPUs and all the connectivity that go into the rack. It's been a really good growth driver for us, and actually our expectations are higher than we just thought when we started the year, and the momentum continues to be strong. Yes, we're going to have times when programs change, some programs come in, come out, but what's really good, our position with our hyperscale customers really has set up nice momentum, not only this year but into next year.

Our orders are up about 70% this year, in our AI space. That's going to set up a really nice tailwind as we go into 2027, and as we continue to help them solve the connectivity needs that happen both on the power and data side. The other thing about this year, just to build on maybe outside of our AI business is, our AI business has been maybe about 40% of our growth this year. TE's going to grow about $2.5 billion this year, and that's really driven by our industrial segment, which includes what we do for our AI customers.

That breadth of growth that we have is really where we bring our connections, whether it be in the energy infrastructure, across aerospace and defense, which are strong secular growth trends that aren't slowing down anytime soon, which contributed incremental growth on top of what we do in AI. As well as our legacy position in transportation, where we have a strong position that really our growth is being driven by content performance that's above market. I know you're going to click down in all of these, Alex, but the element is the breadth of the growth that we have as data proliferates, as well as the power that's needed around that proliferation, I really think makes us a little bit unique as you look at opportunities for investment.

We've always seen our customers obviously look at where optics play from a cost, from a power need, and really to get to the data speeds that is needed in AI. It's not a new discussion, but it also sort of became a little bit of a versus discussion versus an and discussion. That, earlier in the year, was a big discussion. But what we see in our DDN business, which serves our AI customers is, and our large customers have said it publicly, copper's going to be continuing to be the workhorse that you see in the rack. Power connectivity, which is about a third of our DDN business, is always going to be copper. When you look at transmitting data and signal, you're going to see areas where optics is used.

You're also going to see areas where copper continues to be extended because of its scale, its lower cost, as well as lower power consumption. What's nice about where we play is we get to work with our customers as they look at where do they want to experiment. In our AI business, it is something that it's not going to be cookie cutter across the architectures. Some customers are going to push the limit. You will see how that comes into the switch in an optics perspective. You have other customers that say, "No, I want to be at a lower cost for a lower cost per token." So we see a lot of experimentation across our customer base, but what we get excited about is that the copper TAM will continue to grow, that it is an and discussion, not a versus discussion.

We've also positioned ourselves where we would play sort of optics that comes into the switch, because we really play in the scale-up element, we do less in the scale-out, and certainly we're going to be part of that. That will add TAM to us as we look forward. So lots of experimentation going on in any AI architecture, both on the power side and the data side, and they're both things that not only for the growth we've had this year and we expect next year, but also as we look out multiple years and as we work with our customers on those racks and those architectures.