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Jun 30, 2020
Amphenol Q2 2020 Earnings Report
Reported a decrease in sales and adjusted diluted EPS, but exceeded expectations amidst COVID-19 challenges.
Key Takeaways
Amphenol reported second-quarter results with sales of $1.987 billion and adjusted diluted EPS of $0.81. While sales decreased slightly compared to the previous year, the company exceeded expectations despite the negative impacts of the COVID-19 pandemic. Strong growth in information technology, data communications, mobile devices, and industrial markets partially offset slowdowns in the automotive and commercial air markets.
Sales reached $1.987 billion, a 1% decrease compared to Q2 2019, driven by declines in automotive and commercial air markets but offset by growth in other sectors.
Adjusted Diluted EPS was $0.81, demonstrating strong profitability despite significant cost pressures from the COVID-19 pandemic.
Operating margins improved sequentially to 18.0%, and operating cash flow was $368 million, highlighting the quality of earnings.
The company acquired Onanon, Inc., strengthening its capabilities in the industrial market, particularly in medical applications.
Amphenol
Amphenol
Forward Guidance
For the third quarter of 2020, Amphenol expects sales to be in the range of $1.960 billion to $2.000 billion and Adjusted Diluted EPS in the range of $0.84 to $0.86, assuming no new material disruptions from the pandemic and constant exchange rates.
Positive Outlook
- Expected sales in the range of $1.960 billion to $2.000 billion.
- Anticipated Adjusted Diluted EPS in the range of $0.84 to $0.86.
- Guidance assumes no new material disruptions from the pandemic.
- Guidance assumes constant exchange rates.
- Company remains confident in its management team's ability to adjust to changing market conditions.
Challenges Ahead
- Significant economic and public health uncertainties due to the COVID-19 pandemic.
- Difficult to accurately forecast performance in the second half of 2020.
- Full-year sales and EPS guidance not provided.
- Guidance is contingent on the current demand environment.
- Potential for new material disruptions from the pandemic.