TE Connectivity plc stock research
FY2026 Q1
TE Connectivity (TEL) Gross Margin — Quarter Ended Dec 26, 2025
Revenue was stable relative to the prior quarter and higher than the year-ago quarter. Gross profit was similar to the prior quarter and higher year over year, while cost of revenue decreased from the prior quarter and increased from the year-ago period, leading to a gross margin that improved from both comparison periods.
Gross margin takeaway
Quarter ended Dec 26, 2025 · FY2026 Q1
Revenue was stable relative to the prior quarter and higher than the year-ago quarter. Gross profit was similar to the prior quarter and higher year over year, while cost of revenue decreased from the prior quarter and increased from the year-ago period, leading to a gross margin that improved from both comparison periods.
- The reduction in cost of revenue from the preceding quarter, while revenue remained unchanged, was the strongest observable driver of the gross margin improvement. The company's filing discusses its liquidity and capital resources, noting that it expects sufficient cash from operations and other sources to meet anticipated capital needs, including debt repayments due in the near term.
- Compared with the immediately preceding quarter, gross margin was higher, driven by lower cost of revenue with stable revenue. Compared with the same quarter one year earlier, gross margin was also higher, as revenue grew more than cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
37.2%
Gross profit
$1.7B
Revenue
$4.7B
Cost of revenue
$2.9B
Quarter-over-quarter change
+2.3 pts
Year-over-year change
+1.8 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 28, 2025 | $4.1B | $1.5B | $2.7B | 35.2% |
| Jun 27, 2025 | $4.5B | $1.6B | $2.9B | 35.3% |
| Sep 26, 2025 | $4.7B | $1.7B | $3.1B | 35.0% |
| Dec 26, 2025 | $4.7B | $1.7B | $2.9B | 37.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 26, 2025
+2.3 pts
Year-over-year change
Dec 27, 2024
+1.8 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The reduction in cost of revenue from the preceding quarter, while revenue remained unchanged, was the strongest observable driver of the gross margin improvement. The company's filing discusses its liquidity and capital resources, noting that it expects sufficient cash from operations and other sources to meet anticipated capital needs, including debt repayments due in the near term.
Compared with the immediately preceding quarter, gross margin was higher, driven by lower cost of revenue with stable revenue. Compared with the same quarter one year earlier, gross margin was also higher, as revenue grew more than cost of revenue.
Monitor the trajectory of cost of revenue, given its recent decline from the prior quarter while revenue remained flat, and the company's liquidity outlook as outlined in the filing.