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TE Connectivity (TEL) International Revenue Performance Explored

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Have you evaluated the performance of TE Connectivity's (TEL - Free Report) international operations during the quarter that concluded in March 2024? Considering the extensive worldwide presence of this electronics maker, analyzing the patterns in international revenues is crucial for understanding its financial resilience and potential for growth.

In the modern, closely-knit global economic landscape, the capacity of a business to access foreign markets is often a key determinant of its financial well-being and growth path. Investors now place great importance on grasping the extent of a company's dependence on international markets, as it sheds light on the firm's earnings stability, its skill in leveraging various economic cycles and its broad growth potential.

Participation in global economies acts as a defense against economic difficulties at home and a pathway to more rapidly developing economies. However, it also comes with the complexities of dealing with fluctuating currencies, geopolitical risks and different market dynamics.

While analyzing TEL's performance for the last quarter, we found some intriguing trends in revenues from its overseas segments that Wall Street analysts commonly model and monitor.

The company's total revenue for the quarter amounted to $3.97 billion, showing decrease of 4.6%. We will now explore the breakdown of TEL's overseas revenue to assess the impact of its international operations.

Unveiling Trends in TEL's International Revenues

Asia-Pacific accounted for 31.7% of the company's total revenue during the quarter, translating to $1.26 billion. Revenues from this region represented a surprise of -0.73%, with Wall Street analysts collectively expecting $1.27 billion. When compared to the preceding quarter and the same quarter in the previous year, Asia-Pacific contributed $1.38 billion (36%) and $1.3 billion (31.2%) to the total revenue, respectively.

During the quarter, EMEA contributed $1.55 billion in revenue, making up 39.1% of the total revenue. When compared to the consensus estimate of $1.55 billion, this meant a surprise of +0.13%. Looking back, EMEA contributed $1.41 billion, or 36.8%, in the previous quarter, and $1.67 billion, or 40.1%, in the same quarter of the previous year.

Projected Revenues in Foreign Markets

It is projected by analysts on Wall Street that TE Connectivity will post revenues of $4.01 billion for the ongoing fiscal quarter, an increase of 0.4% from the year-ago quarter. The expected contributions from Asia-Pacific and EMEA to this revenue are 32.9% and 39.9%, translating into $1.32 billion and $1.6 billion, respectively.

Analysts expect the company to report a total annual revenue of $15.98 billion for the full year, marking a decrease of 0.3% compared to last year. The expected revenue contributions from Asia-Pacific and EMEA are projected to be 33.4% ($5.34 billion) and 38.7% ($6.18 billion) of the total revenue, in that order.

Closing Remarks

Relying on global markets for revenues presents both prospects and challenges for TE Connectivity. Therefore, scrutinizing its international revenue trends is key to effectively forecasting the company's future outlook.

In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.

At Zacks, we place significant importance on a company's evolving earnings outlook. This is based on empirical evidence demonstrating its strong influence on a stock's short -term price movements. Invariably, there exists a positive relationship -- an upward revision in earnings estimates is typically mirrored by a rise in the stock price.

The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.

TE Connectivity currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

A Review of TE Connectivity's Recent Stock Market Performance

Over the preceding four weeks, the stock's value has diminished by 3.5%, against a downturn of 2% in the Zacks S&P 500 composite. In parallel, the Zacks Computer and Technology sector, which counts TE Connectivity among its entities, has depreciated by 1.9%. Over the past three months, the company's shares have seen a decline of 1.8% versus the S&P 500's 4.6% increase. The sector overall has witnessed an increase of 4.2% over the same period.

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