AI Takeaway
TEL delivered strong Q1 FY2026 results with revenue of $4.67B (+21.7% YoY) and net income of $750M (+42.0% YoY), driven by robust margin expansion across gross, operating, and net profit lines.
Revenue
$4.67B
++21.72% YoY
EPS (Basic)
$2.55
++44.07% YoY
Gross Margin
37.2%
++1.79% YoY
Operating Income
$963M
++39.57% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Revenue grew 21.7% YoY to $4.67B in Q1 FY2026 from $3.84B in the prior-year period, reflecting broad-based demand strength. Gross profit expanded even faster at +27.9% YoY to $1.74B, indicating favorable product mix or pricing power.
Source: Source: 10-Q Income Statement
Operating income surged 39.6% YoY to $963M, outpacing revenue growth by a wide margin. Operating margin expanded approximately 263 basis points to 20.6%, demonstrating meaningful operating leverage as fixed costs were spread over a larger revenue base.
Source: Source: 10-Q Income Statement
Net income rose 42.0% YoY to $750M, while diluted EPS jumped 44.6% to $2.53 from $1.75 in the prior year. The outsized EPS growth relative to net income suggests share count reduction from buybacks contributed to per-share accretion.
Source: Source: 10-Q Income Statement & Cash Flow Statement
2 more insights available
Upgrade to unlockLong-term debt surged 47.8% YoY to $4.86B, significantly increasing TEL's financial leverage. If revenue growth decelerates or interest rates remain elevated, debt servicing could pressure free cash flow and financial flexibility. Total liabilities now stand at $12.42B versus $9.91B a year ago.
Source: Source: 10-Q Balance Sheet
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $2.72 versus the $2.58 analyst consensus — a +5.6% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $4.67B | $3.84B | +21.72% |
Cost of Revenue | $2.93B | $2.48B | +18.34% |
Gross Profit | $1.74B | $1.36B | +27.87% |
Operating Income | $963M | $690M | +39.57% |
Net Income | $750M | $528M | +42.05% |
EPS (Basic) | $2.55 | $1.77 | +44.07% |
EPS (Diluted) | $2.53 | $1.75 | +44.57% |
SG&A Expense | $538M | $427M | +26.00% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $25.55B | $22.44B | +13.86% |
Current Assets | $8.37B | $7.52B | +11.29% |
Total Liabilities | $12.42B | $9.91B | +25.31% |
Current Liabilities | $5.07B | $4.47B | +13.32% |
Cash & Equivalents | $1.25B | $1.25B | -0.24% |
Long-Term Debt | $4.86B | $3.29B | +47.82% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $865M | $878M | -1.48% |
Investing Cash Flow | $-254M | $-537M | +52.70% |
Financing Cash Flow | $-616M | $-395M | -55.95% |
Share Buybacks | $405M | $303M | +33.66% |
D&A | $259M | $186M | +39.25% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 37.2% | 35.5% | +1.79% |
Operating Margin | 20.6% | 18.0% | +2.64% |
Net Margin | 16.1% | — | — |
ROA | 2.9% | — | — |
Current Ratio | $1.651 | — | — |
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TEL delivered strong Q1 FY2026 results with revenue of $4.67B, up 21.7% YoY, and net income of $750M, up 42.0% YoY. Diluted EPS came in at $2.53, a 44.6% increase from $1.75 in the prior-year quarter, reflecting both earnings growth and share buybacks.
TEL's revenue grew 21.7% YoY to $4.67B in Q1 FY2026, with gross profit growing even faster at 27.9% to $1.74B, suggesting favorable product mix and/or pricing power. The company also achieved significant operating leverage, with operating income rising 39.6% to $963M.
The most notable risk is TEL's long-term debt, which surged 47.8% YoY to $4.86B, significantly increasing financial leverage. Additionally, SG&A expenses grew 26.0% YoY, outpacing revenue growth of 21.7%, and operating cash flow declined 1.5% despite strong earnings growth, suggesting working capital pressures.
TEL shows strong profitability with a 20.6% operating margin and $750M in net income, but its balance sheet leverage has increased with long-term debt rising to $4.86B (+47.8% YoY). The current ratio of 1.65x and operating cash flow of $865M indicate adequate near-term liquidity, though the debt increase warrants monitoring.
Yes, TEL repurchased $405M worth of shares in Q1 FY2026, a 33.7% increase from $303M in the prior-year quarter. This active buyback program contributed to diluted EPS growth of 44.6%, which outpaced net income growth of 42.0%.