Total Revenue

Up 4.4% (from $3,967M in Q2 2024 to $4,143M in Q2 2025)

Revenue growth was driven by an exceptional surge in Industrial Solutions (up nearly 60% YoY) that more than offset a modest 3% decline in the Transportation Solutions segment, in addition to strong performance in Asia-Pacific despite softness in EMEA and a relatively flat Americas region " " vs.. "

Transportation Solutions

Down 3% (from $2,384M in Q2 2024 to $2,314M in Q2 2025)

Modest decline in this segment reflects challenges such as softening demand and potential operational issues in key submarkets, contributing to a slight revenue contraction " " vs.. "

Industrial Solutions

Up 60% (from $1,143M in Q2 2024 to $1,829M in Q2 2025)

Sales surged due to robust underlying demand and strategic initiatives that improved product mix and customer engagement, demonstrating an exceptional turnaround in this business unit " " vs.. "

Asia-Pacific Revenue

Up 22.7% (from $1,257M in Q2 2024 to $1,542M in Q2 2025)

Strong organic growth spurred by improvements in both Industrial and Transportation segments helped drive a significant increase in revenues in the region " " vs.. "

EMEA Revenue

Down 8.9% (from $1,552M in Q2 2024 to $1,413M in Q2 2025)

Weaker market conditions and possible currency headwinds in the region resulted in a decline in revenue performance for EMEA " " vs.. "

Americas Revenue

Up 2.6% (from $1,158M in Q2 2024 to $1,188M in Q2 2025)

Minimal change occurred as slight organic improvements were largely offset by market softness, leading to relatively flat revenue performance in the Americas " " vs.. "

Operating Income

Up 8% (from $692M in Q2 2024 to $748M in Q2 2025)

Improved operational efficiency and cost management—including productivity gains and better margin control—helped increase operating income despite mixed segment performance " vs.. "

Net Income

Down 97.6% (from $541M in Q2 2024 to $13M in Q2 2025)

Dramatic deterioration in net income resulted from a severe increase in income tax expense (which nearly quintupled from –$146M to –$742M), overwhelming the operating income gains and almost erasing profitability " vs.. "

Income Tax Expense

Nearly quintupled (from –$146M in Q2 2024 to –$742M in Q2 2025)

Tax adjustments—possibly due to changes in tax credit benefits or revaluation events—led to a significant increase in tax expense, which in turn severely impacted net income " vs.. "

Net Cash from Operating Activities

Down 37% (from $1,042M in Q2 2024 to $653M in Q2 2025)

Declines in operating cash flow were primarily driven by changes in working capital management that eroded cash generation despite higher revenues " vs.. "

Cash and Cash Equivalents

Up nearly 100% (from $1,319M in Q2 2024 to $2,554M in Q2 2025)

Significant improvement in liquidity reflects a combination of reduced cash outflows (e.g., lower share repurchases) and increased debt financing, boosting cash reserves markedly " vs.. "

Total Liabilities

Up 10% (from $10,368M in Q2 2024 to $11,439M in Q2 2025)

Liabilities increased largely due to higher accounts payable, a rise in accrued and other current liabilities, and increased short-term debt obligations, contributing to a 10% growth " vs.. "

Total Shareholders’ Equity

Slight down (from $12,355M in Q2 2024 to $12,085M in Q2 2025)

A marginal decline in equity is attributable to lower net income (due to higher tax expense) and a slight increase in liabilities, which together offset previous periods’ gains in retained earnings and other comprehensive income " vs.. "

Sales

Q3 2025

$3.95 billion "

$4.3 billion "

raised

Adjusted EPS

Q3 2025

$1.96 "

$2.06 "

raised

Adjusted Tax Rate

Q3 2025

23% "

24%-25% "

raised

Tariff Impact

Q3 2025

no prior guidance

3% of sales "

no prior guidance

Artificial Intelligence

In Q1 2025, AI was characterized by rapid revenue growth (e.g. doubling from $300M and a projection to exceed $600M) and strong program momentum with significant design wins. " " In Q3 2024, the focus was on establishing early design wins through hyperscalers and cloud-driven momentum. " " "

In Q2 2025, AI growth is even more pronounced with revenue expectations over $700M in fiscal 2025, a 150% increase in orders versus previous expectations, and an anticipated $1B in AI-related revenue by fiscal 2026. " " "

Consistently bullish with accelerating growth – sentiment has strengthened over time, with robust orders and rising revenue expectations.

Global Tariff Impacts

Q1 2025 covered a prepared playbook based on past tariff cycles to handle potential impacts (recalling the 2017 experience). " " Q3 2024 did not mention tariffs.

Q2 2025 details active mitigation measures, with tariffs impacting roughly 3% of sales and a strategy that employs sourcing changes plus significant pricing actions to recover costs. " "

Heightened emphasis – tariff issues are now addressed with proactive adjustments and pricing actions compared to earlier reliance solely on a playbook.

Localization Strategy

In Q1 2025, localization was highlighted with approximately 80% in-region manufacturing to align with customer needs. " Q3 2024 discussions on restructuring touched on moving production to lower-cost regions, indirectly supporting localization.

Q2 2025 continues to stress a strong localized approach, with over 70% of production localized per region, which also aids in mitigating the impact of tariffs and supply chain disruptions. " "

Consistent commitment – the focus on localized manufacturing remains strong across periods to ensure supply chain resilience and cost efficiency.

Automotive Industry Dynamics

Q1 2025 noted a modest global auto production decline (down 3% organically) with regional disparities (Asia growing versus Western declines). " " Q3 2024 reflected stability in production with increasing electrified powertrain volumes. "

Q2 2025 reports a 5% year-over-year decline in global auto production, with Asia’s growth offsetting steeper declines in Europe and North America; content growth is forecast at the lower end of a 4–6% range. " " "

Mixed but evolving – challenges in Western markets persist while Asian markets remain a bright spot; the overall outlook is cautiously optimistic.

Electrification Trends

Q1 2025 emphasized secured design wins in EV/hybrid platforms and projected production advantages in Asia. " " Q3 2024 highlighted robust growth in electrified powertrains, with significant percentage increases in battery electrics, hybrids, and plug-in hybrids, especially in Asia. " "

Q2 2025 underscores strong trends with an expected 20% growth in hybrid and electric production, alongside an increased focus on electronification and data connectivity within vehicles. " "

Sustained robust growth – electrification continues to be a key driver, with strong sentiment supported by high percentage gains and strategic investments.

Margin Expansion

Q1 2025 reported record adjusted operating margins of 19.4% (with Industrial margins expanding and strong cost management). " " " Q3 2024 noted record adjusted margins (e.g. 19.3%) driven by operational execution and incremental improvements in key segments. " "

In Q2 2025, margins continue to expand with overall margins up by 90 basis points and the Industrial segment widening by 260 basis points to 17.9%. " " "

Consistently positive – margin expansion remains a key focus, with steady improvements stemming from operational efficiency and strong sales execution.

Restructuring

Q1 2025 mentioned $43M in restructuring charges focused on footprint optimization by shifting production from higher-cost regions. " " Q3 2024 also discussed restructuring charges and self-help initiatives as part of cost rationalization efforts. " "

In Q2 2025, restructuring remains a priority with $45M in charges noted; efforts focus on reducing the manufacturing footprint and further aligning localization with customer needs. " "

Steady focus – restructuring and cost optimization are continuously emphasized to drive efficiency with consistent charge levels.

Operational Leverage

Q1 2025 highlighted the effective use of operational levers to support a record margin performance in both Industrial and Transportation segments. " " Q3 2024 reinforced the role of operational adjustments in boosting margins and portfolio optimization. " " "

Q2 2025 continues to leverage these operational efficiencies, particularly evident in the strong performance of the Industrial segment and ongoing capacity adjustments. " " "

Maintained strength – operational leverage remains a consistently strong theme, with persistent efforts yielding stable margin improvements.

Financial Strength

Q1 2025 showcased strong financial performance with a healthy balance sheet and record operating margins, underpinning overall stability. " Q3 2024 demonstrated robust adjusted operating income and EPS growth fueled by efficient operations. "

Q2 2025 reinforces financial strength through strong cash generation, a healthy balance sheet, and confidence in navigating dynamic market conditions despite external challenges. " "

Consistently robust – financial strength across all periods provides a solid foundation for strategic initiatives and future investments.

Free Cash Flow Generation

Q1 2025 recorded a strong first-quarter free cash flow of $674M with high operational cash generation. " Q3 2024 reported record free cash flow figures and impressive year-over-year growth in cash metrics. " "

Q2 2025 reported $424M in free cash flow for the quarter, with expectations that full-year free cash flow conversion will exceed 100%. "

Sustained performance – free cash flow generation remains a standout strength, indicating robust earnings quality over time.

Strategic Capital Allocation

Q1 2025 outlined a balanced approach with significant shareholder returns via dividends and share buybacks, alongside bolt-on acquisitions (e.g. the Harger acquisition). " " Q3 2024 detailed a long-term strategy of allocating two-thirds of free cash flow to shareholders while actively pursuing acquisitions. " "

Q2 2025 emphasized an aggressive allocation strategy, highlighted by a $2.3B deployment for the Richards acquisition coupled with approximately $1B in shareholder returns. " " "

Aggressively growth-oriented – strategic capital allocation continues to be focused on investment and shareholder returns, signaling commitment to future growth.

Supply Chain

In Q1 2025, supply chain issues were seen stabilizing in segments like automation and control through inventory normalization, with some regional challenges remaining. " " Q3 2024 discussed destocking trends and improved backlog management, alongside adjustments to service levels. " "

Q2 2025 acknowledges ongoing supply chain uncertainty causing distractions and necessitating real-time adjustments; however, orders remain stable and mitigation strategies are in place. " "

Persistent uncertainty with active management – while challenges remain, companies are adapting and order stability provides some reassurance.

Order Dynamics Uncertainty

Q1 2025 reported that orders were slightly ahead of expectations with a healthy book-to-bill ratio (1.05) and stabilization in various regions, though some disparities persisted. " " " Q3 2024 highlighted continuing destocking challenges but also noted that order patterns were beginning to flatten. "

Q2 2025 indicates that despite supply chain distractions and potential tariff concerns, overall order patterns remain stable with affirmative book-to-bill dynamics, particularly in the Industrial segment. " "

Evolving towards stability – initial uncertainty is gradually being overcome, with orders showing more consistency despite regional variations.

Digital Data Networks

Q1 2025 mentioned significant investments needed to support capacity growth in Digital Data Networks, driven largely by the surge in AI applications and associated ramps. " " Q3 2024 did not explicitly address DDN investment needs beyond general CapEx in growth areas.

Q2 2025 did not specifically highlight new investment needs for Digital Data Networks; instead, the focus was on strong growth performance in digital data networks driven by hyperscale program ramps. " "

Shift in focus – previous concerns about adding capacity have transitioned to a performance-driven narrative, with investment needs no longer emphasized.

Commercial Transportation

Q1 2025 discussed a 12% organic decline in Commercial Transportation due to heavy truck production weakness in Europe and North America, with cautious optimism driven by expected improvements from regulatory changes. " " Q3 2024 reported an 8% decline but noted stable margins and the potential for recovery in coming periods. " "

Q2 2025 reports ongoing challenges including financing issues in key regions (Europe and North America) with stability in orders and expectations for future recovery—possibly aided by emission regulation changes expected in 2027. " "

Consistent challenges with cautious optimism – while declines persist, the strategic outlook remains hopeful for a market turnaround driven by structural shifts.

Industrial Market Weakness

Q1 2025 observed broader weakness in industrial markets, particularly in Western regions, with some stabilization noted as order patterns began to balance. " " Q3 2024 detailed a 24% organic decline in industrial equipment sales with continued destocking, though signs of flattening emerged. " "

Q2 2025 continues to acknowledge industrial market weakness in certain regions; however, the Industrial Solutions segment is buoyed by strong growth drivers such as AI, energy, aerospace, and defense, offsetting some of the broader market weakness. " "

Ongoing regional challenges offset by portfolio diversification – industrial weaknesses persist in some areas while strong performance in key segments mitigates overall impacts.