Manufacturing
Deployment record
In the tracker →- Organisation
- TE Connectivity
- System
- digital data networks (DDN)
- Stage
- Announced
- Function
- connectivity in data centers
- Scale
- $20B in sales
- 01TE Connectivity expects to add over $1 billion in revenue from its digital data networks business in fiscal 2027, primarily driven by AI applications.
- 02The digital data networks business saw a 70% growth in orders during fiscal 2026 and has more than doubled in size over the past few years.
- 03TE's revenue from power connectivity now accounts for about 30% of its digital data networks revenue, benefiting from trends like 800-volt direct current power and liquid cooling.
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- 04TE Connectivity reported fiscal Q4 2026 sales of $5.3 billion, a 13% organic increase, with a book-to-bill ratio of 1.14 and a backlog of approximately $8 billion.
- 05The company anticipates continued double-digit organic sales growth in fiscal 2027, supported by strong orders and a growing backlog.
TE Connectivity
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TE Connectivity CEO Terrence Curtin said on the company's fiscal Q4 2026 earnings call on October 28, 2026 that TE expects to add more than $1 billion of revenue in its digital data networks business in fiscal 2027.
"In 2027, we expect to add over $1 billion of DDN revenue with the vast majority of that from AI applications," Curtin said, adding that over half of that growth is expected in the second half of the fiscal year.
The digital data networks business, known as DDN, supplies the connectivity used in data center networking, according to the company.
Curtin said DDN orders grew roughly 70% in fiscal 2026, driven by TE's position with hyperscale customers, and that the business has more than doubled in size over the past couple of years. He said TE expects DDN to grow by well over $1 billion a year over an extended period.
"We still believe we're in the early stages of the AI infrastructure buildout," Curtin said.
Copper, Fiber, and the Shift to Inference
Curtin said the changing shape of AI workloads is widening demand for TE's products. He said the shift toward inference and agentic AI is expanding demand for CPUs and networking connectivity, alongside the growth in accelerators.
He said future data center architectures will require both copper and fiber connectivity. In a scenario analysis, TE sees its copper addressable market growing more than 100%, while optical connectivity adds a further growth opportunity for DDN.
Curtin pointed to TE's RAM Photonics technology, which is focused on fiber attach density for co-packaged optics, and to a recent NVIDIA and Cisco announcement on next-generation optical transceivers as an example of hybrid optical and copper designs.
He said not every customer is planning fiber to the chip in its near-term roadmaps, and that next-generation racks are expected to use both technologies.
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Power is a growing part of the business. Curtin said about 30% of DDN revenue now comes from power connectivity, and that TE is gaining content as data centers move to 800-volt direct current power and liquid cooling.
TE's Energy business is also benefiting from data center build-outs and the electrical infrastructure needed to power them. Curtin said DDN and Energy together accounted for about half of TE's organic sales growth in fiscal 2026.
AI Beyond the Data Center
Curtin said AI is also moving beyond the data center into physical AI applications, including factory automation, vehicles, and robotics, areas where TE already sells connectivity products.
CFO Heath Mitts said TE is positioned "to benefit from the largest technology infrastructure investments taking place globally," and that strong orders and backlog support the company's outlook for double-digit sales growth in fiscal 2027.
On timing, Curtin said TE's backlog of about $8 billion is spread across the next year and a little into the year after, and that DDN and Aerospace and Defense together account for about 60% of backlog growth.
He said DDN sales are expected to rise slightly from Q4 to Q1, with most of the fiscal 2027 increase weighted toward the second half.
TE did not disclose a standalone AI revenue figure. DDN sits within the company's Industrial Solutions segment, where Q4 sales rose 20% and orders rose 47%, with DDN growing 17% sequentially.
TE reported fiscal Q4 2026 sales of $5.3 billion, up 13% organically, and orders of $6.1 billion, up 29% year over year, for a book-to-bill ratio of 1.14. Adjusted EPS was $3.14, up 21%, and the adjusted operating margin was 22.1%, up 100 basis points.
For the full fiscal year, sales were nearly $20 billion, up 15% on a reported basis and 12% organically, with record orders of more than $22 billion. Adjusted EPS was $11.52, up 24%.
TE enters fiscal 2027 with a backlog of about $8 billion, up roughly 30%, and expects another year of double-digit organic sales growth
