During the first quarter of fiscal 2024, TE acquired approximately 98.7% of Schaffner Holding AG, a leader in electromagnetic solutions, for a purchase price of $339 million, net of cash acquired. The acquired business is reported as part of the Industrial Solutions segment.

During fiscal 2024, TE sold one business for net cash proceeds of $59 million, recording a pre-tax gain on sale of $10 million. The divested business was reported in our Transportation Solutions segment.

Effective for the first quarter of fiscal 2025, TE will reorganize its management and segments. The Communications Solutions segment will be moved into the Industrial Solutions segment, and the appliances and industrial equipment businesses will be combined to form the automation and connected living business.

During fiscal 2024, TE initiated a restructuring program to optimize its manufacturing footprint and improve the cost structure of the organization, primarily in the Industrial Solutions and Transportation Solutions segments. Annualized cost savings related to actions initiated in fiscal 2024 are expected to be approximately $85 million.

TE has been able to mitigate increased costs and supply chain disruptions through productivity and/or price increases. The company has also focused on actions to manage costs, including restructuring and other cost reduction initiatives.

TE continues to emphasize employee development and training to support engagement and retention. The company provides a range of development programs and opportunities, skills, and resources they need to be successful.

TE's business and operating results are affected by economic conditions regionally or globally, including tariffs, trade barriers, inflation, and slower growth or recession. These factors could cause customers to delay or cancel plans to purchase products.

TE is subject to increased public awareness regarding climate change, leading to international treaties and legislative efforts. Failure to comply with these requirements may result in reduced demand for products, reputational harm, or other adverse impacts to our business.

Cybersecurity attacks, threats, and breaches could interfere with TE's operations, compromise confidential information, and expose the company to liabilities. The company is also subject to various privacy and security laws and regulations.

TE operates in highly competitive markets for electronic components and expects that both direct and indirect competition will increase in the future. Competition is based on price, quality, and performance of products; the level of customer service; the development of new technology; and customers' expectations relating to socially responsible operations.

TE's operating results depend substantially upon its ability to continually design, develop, introduce, and sell new and innovative products; to modify existing products; and to customize products to meet customer requirements driven by technological change.

TE has experienced, and may in the future experience, pressure to lower its prices. To maintain margins, TE must continue to reduce its costs. The company cannot provide assurance that pressure to reduce prices will not have a material adverse effect on its margins.

TE has been able to mitigate increased costs and supply chain disruptions through productivity and/or price increases. The company has also taken and continues to focus on actions to manage costs, including restructuring and other cost reduction initiatives.

TE initiated a restructuring program to optimize its manufacturing footprint and improve the cost structure of the organization, primarily in the Industrial Solutions and Transportation Solutions segments. Annualized cost savings related to actions initiated in fiscal 2024 are expected to be approximately $85 million.

Customer orders and demand may fluctuate as a result of economic and market conditions, including supply chain disruptions and inflationary cost pressures. The company has experienced inflationary cost pressures including increased costs for transportation, energy, and raw materials.

The pace of technological change is increasing at an exponential rate. TE must stay abreast of new technologies, including AI, blockchain, quantum computing, data analytics, 3-D printing, robotics, sensor technology, data storage, and neural networks.

The development, adoption, and use of AI technologies is still in the early stages and involve significant risks and uncertainties, which may expose TE to legal, reputational, and financial harm. AI algorithms and training methodologies may be flawed, and datasets may be overbroad, insufficient, or contain biased information.

TE's operating results depend substantially upon its ability to continually design, develop, introduce, and sell new and innovative products; to modify existing products; and to customize products to meet customer requirements driven by technological change.

On October 30, 2024, TE's board of directors authorized an increase of $2.5 billion in its share repurchase program. At fiscal year end 2024, the company had $245 million of availability remaining under its share repurchase authorization.

During fiscal 2024, TE's shareholders approved a dividend payment of $2.60 per share, payable in four equal quarterly installments of $0.65 per share. Beginning in the third quarter of fiscal 2025, future dividends will be declared on a quarterly basis by the board of directors.

Capital expenditures were $680 million in fiscal 2024. TE expects fiscal 2025 capital spending levels to be approximately 5% of net sales. The company believes its capital funding levels are adequate to support new programs and continues to invest in its manufacturing infrastructure.

TE has committed to near-term, company-wide GHG emissions reductions in line with climate science and Science Based Targets initiative objectives. The company has achieved more than a 70% reduction in absolute GHG emissions for Scopes 1 and 2 from fiscal 2020 to 2024.

Companies across industries are facing increasing scrutiny from a variety of stakeholders related to their ESG and sustainability practices. Expectations regarding voluntary and potential mandatory ESG initiatives and disclosures may result in increased costs, changes in demand for certain products, enhanced compliance or disclosure obligations.

TE is committed to the safety, health, well-being, and human rights of its employees. The company has instituted several policies to guide it, including a global human rights policy and a human trafficking and modern slavery policy. TE reduced its OSHA total recordable incident rate to 0.11 in fiscal 2024.

TE's business and operating results have been and will continue to be affected by economic conditions regionally or globally, including new or increased tariffs and other barriers to trade, changes to fiscal and monetary policy, inflation, slower growth or recession, and higher interest rates.

There continues to be significant uncertainty about the relationship between the U.S. and China, including with respect to geopolitics, trade policies, treaties, government regulations, and tariffs. TE's operations and transactions with customers in China could be adversely affected by changes to market conditions, changes to the regulatory environment, increased trade barriers, tariffs, or restrictions.

The global equity markets have been volatile and at times credit markets have been disrupted, which has reduced the availability of investment capital and credit. Downgrades of sovereign debt credit ratings have similarly affected the availability and cost of capital.