TE Connectivity gives 630 German jobs a 2028 expiry date and spends $1.4bn on AI power
A works-council accord signed on Wednesday locks TE's Speyer plant into a production shutdown by the end of 2028, while the same company pays 5.6 times sales for a power-supply maker feeding AI racks. Amphenol's proven version of this story carries a $194 billion market cap; TE's costs $63 billion.
Vincent Jiang · 3 min read
TE Connectivity and its central works council signed an Interessenausgleich, the German accord that settles how a plant dies, on Wednesday in Speyer. Four months of negotiation ended with production at the Siemensstraße site, a former Siemens works, confirmed to close by the end of 2028 12. About 630 jobs are affected, the toll reported when TE announced the exit to staff in May 3. IG Metall's Mathias Franz, kept informed through the talks, declined to call it a win: "Whether the workforce is satisfied, I don't know" 2.
$1.4 billion goes the other way
Three months before the signing, on 22 July, TE agreed to pay the private firm Tinicum about $1.4 billion for Astrodyne TDI, a New Jersey maker of power supplies and EMI filters used in semiconductor tools, medical gear and defense systems 45. The price runs roughly 5.6 times Astrodyne's expected annual sales of more than $250 million, and closing is due by year-end 4.
The market wants the AI half of TE
The pull is real. Orders at Digital Data Networks, the business feeding high-speed copper and power into hyperscaler GPU racks, are up more than 70 percent this year; DDN sales rose 34 percent in the June quarter, and TE figures power is already about a third of it 7. Quarterly orders hit a reported record of $5.7 billion 8. Total revenue still grew only 13.8 percent, to $5.16 billion, and adjusted EPS of $2.94 beat the $2.85 consensus, yet the stock fell about 6 percent on the report 89.
Amphenol owns the connection, for now
Amphenol grew its AI-linked segments near 90% last quarter; TE's total grew 14%
Data
| Value | |
|---|---|
| Amphenol IT datacom | 89% |
| Amphenol Communications | 85% |
| Amphenol total | 55% |
| TE Digital Data Networks | 34% |
| Bel Fuse ITDS | 31.1% |
| TE total | 13.8% |
Amphenol's Communications Solutions segment grew 85 percent to $5.38 billion, 62 percent of revenue, on IT datacom up 89 percent 7. Its total June quarter rose 55 percent to $8.76 billion 10. Investors pay for that version of the story: a $194 billion capitalization against TE's $63 billion 109, at 27.5 times forward earnings 7.
The case for the laggard
Bernstein opened TE at Outperform on 23 September with a $243 target, 11.6 percent above the 1 October close 9. GAAP operating margin has climbed from 16 percent toward 20 percent across eight reported quarters 11, the dividend is up 10 percent to $0.78 a quarter 89, and management calls Astrodyne accretive to growth and margins 6. No document ties Speyer's closure to the purchase price; the record shows reallocation, not a transfer.
TE's operating margin has climbed from 16% to about 20% over eight quarters
Data
| GAAP operating margin | |
|---|---|
| Q3 '24 | 16% |
| Q4 '24 | 18% |
| Q1 '25 | 18.1% |
| Q2 '25 | 18.9% |
| Q3 '25 | 19.3% |
| Q4 '25 | 20.6% |
| Q1 '26 | 20.1% |
| Q2 '26 | 19% |
What decides it
Astrodyne closes by year-end; Speyer produces until 2028 41. The tell is whether DDN's 34 percent converges on Amphenol's 89 percent, with Amphenol reporting on 28 October 10. Speyer has until the end of 2028; TE's discount to Amphenol may not wait that long.
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
