10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)
ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended December 28, 2018
Or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

001-33260
(Commission File Number)

TE CONNECTIVITY LTD.
(Exact name of registrant as specified in its charter)

Switzerland
(Jurisdiction of Incorporation) 98-0518048
(I.R.S. Employer Identification No.)

Rheinstrasse 20
CH-8200 Schaffhausen, Switzerland
(Address of principal executive offices)

+41 (0)52 633 66 61
(Registrant's telephone number)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý Accelerated filer o Non-accelerated filer o Smaller reporting company o Emerging growth company o

        If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý

        The number of common shares outstanding as of January 18, 2019 was 338,854,434.

TE CONNECTIVITY LTD.
INDEX TO FORM 10-Q

		Page
Part I.	Financial Information
Item 1.	Financial Statements		1
	Condensed Consolidated Statements of Operations for the Quarters Ended December 28, 2018 and December 29, 2017 (unaudited)		1
	Condensed Consolidated Statements of Comprehensive Income for the Quarters Ended December 28, 2018 and December 29, 2017 (unaudited)		2
	Condensed Consolidated Balance Sheets as of December 28, 2018 and September 28, 2018 (unaudited)		3
	Condensed Consolidated Statements of Shareholders' Equity for the Quarters Ended December 28, 2018 and December 29, 2017 (unaudited)		4
	Condensed Consolidated Statements of Cash Flows for the Quarters Ended December 28, 2018 and December 29, 2017 (unaudited)		5
	Notes to Condensed Consolidated Financial Statements (unaudited)		6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		42
Item 4.	Controls and Procedures		42
Part II.	Other Information
Item 1.	Legal Proceedings		43
Item 1A.	Risk Factors		43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		43
Item 6.	Exhibits		44
Signatures			45

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PART I. FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

TE CONNECTIVITY LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions, except per share data)
Net sales	$	3,347		$	3,336
Cost of sales		2,233			2,172
Gross margin		1,114			1,164
Selling, general, and administrative expenses		389			377
Research, development, and engineering expenses		161			165
Acquisition and integration costs		5			2
Restructuring and other charges, net		75			34
Operating income		484			586
Interest income		5			4
Interest expense		(27	)		(26	)
Other income (expense), net		(1	)		2
Income from continuing operations before income taxes		461			566
Income tax expense		(78	)		(599	)
Income (loss) from continuing operations		383			(33	)
Loss from discontinued operations, net of income taxes		(107	)		(7	)
Net income (loss)	$	276		$	(40	)
Basic earnings (loss) per share:
Income (loss) from continuing operations	$	1.12		$	(0.09	)
Loss from discontinued operations		(0.31	)		(0.02	)
Net income (loss)		0.81			(0.11	)
Diluted earnings (loss) per share:
Income (loss) from continuing operations	$	1.11		$	(0.09	)
Loss from discontinued operations		(0.31	)		(0.02	)
Net income (loss)		0.80			(0.11	)
Weighted-average number of shares outstanding:
Basic		342			352
Diluted		344			352

See Notes to Condensed Consolidated Financial Statements.

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TE CONNECTIVITY LTD.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Net income (loss).	$	276	$	(40	)
Other comprehensive income:
Currency translation		19		67
Adjustments to unrecognized pension and postretirement benefit costs, net of income taxes		6		7
Gains on cash flow hedges, net of income taxes		24		2
Other comprehensive income		49		76
Comprehensive income.	$	325	$	36

See Notes to Condensed Consolidated Financial Statements.

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TE CONNECTIVITY LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	December 28, 2018			September 28, 2018
	(in millions, except share data)
Assets
Current assets:
Cash and cash equivalents	$	505		$	848
Accounts receivable, net of allowance for doubtful accounts of $26 and $22, respectively		2,380			2,361
Inventories		1,986			1,857
Prepaid expenses and other current assets		507			661
Current assets held for sale		—			472
Total current assets		5,378			6,199
Property, plant, and equipment, net		3,550			3,497
Goodwill		5,648			5,684
Intangible assets, net		1,648			1,704
Deferred income taxes		2,580			2,144
Other assets		384			1,158
Total Assets	$	19,188		$	20,386
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	585		$	963
Accounts payable		1,538			1,548
Accrued and other current liabilities		1,348			1,711
Current liabilities held for sale		—			188
Total current liabilities		3,471			4,410
Long-term debt		3,382			3,037
Long-term pension and postretirement liabilities		1,101			1,102
Deferred income taxes		207			207
Income taxes		335			312
Other liabilities		456			487
Total Liabilities		8,952			9,555
Commitments and contingencies (Note 8)
Shareholders' equity:
Common shares, CHF 0.57 par value, 357,069,981 shares authorized and issued		157			157
Accumulated earnings		11,886			12,114
Treasury shares, at cost, 17,727,608 and 12,279,603 shares, respectively		(1,550	)		(1,134	)
Accumulated other comprehensive loss		(257	)		(306	)
Total Shareholders' Equity		10,236			10,831
Total Liabilities and Shareholders' Equity	$	19,188		$	20,386

See Notes to Condensed Consolidated Financial Statements.

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TE CONNECTIVITY LTD.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(UNAUDITED)

	Common Shares				Treasury Shares
																	Accumulated Other Comprehensive Loss
											Contributed Surplus			Accumulated Earnings						Total Shareholders' Equity
	Shares		Amount		Shares			Amount
	(in millions)
Balance at September 28, 2018		357	$	157		(12	)	$	(1,134	)	$	—		$	12,114		$	(306	)	$	10,831
Adoption of ASU No. 2016-16		—		—		—			—			—			(443	)		—			(443	)
Net income		—		—		—			—			—			276			—			276
Other comprehensive income		—		—		—			—			—			—			49			49
Share-based compensation expense		—		—		—			—			23			—			—			23
Exercise of share options		—		—		—			7			—			—			—			7
Restricted share award vestings and other activity		—		—		—			72			(23	)		(61	)		—			(12	)
Repurchase of common shares		—		—		(6	)		(495	)		—			—			—			(495	)
Balance at December 28, 2018		357	$	157		(18	)	$	(1,550	)	$	—		$	11,886		$	(257	)	$	10,236
Balance at September 29, 2017		357	$	157		(5	)	$	(421	)	$	—		$	10,175		$	(160	)	$	9,751
Net loss		—		—		—			—			—			(40	)		—			(40	)
Other comprehensive income		—		—		—			—			—			—			76			76
Share-based compensation expense		—		—		—			—			29			—			—			29
Exercise of share options		—		—		1			54			—			—			—			54
Restricted share award vestings and other activity		—		—		—			92			(29	)		(88	)		—			(25	)
Repurchase of common shares		—		—		(2	)		(214	)		—			—			—			(214	)
Balance at December 29, 2017		357	$	157		(6	)	$	(489	)	$	—		$	10,047		$	(84	)	$	9,631

See Notes to Condensed Consolidated Financial Statements.

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TE CONNECTIVITY LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Cash Flows From Operating Activities:
Net income (loss)	$	276		$	(40	)
Loss from discontinued operations, net of income taxes		107			7
Income (loss) from continuing operations		383			(33	)
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities:
Depreciation and amortization		168			162
Deferred income taxes		(11	)		510
Provision for losses on accounts receivable and inventories		23			17
Share-based compensation expense		23			28
Other		18			(6	)
Changes in assets and liabilities, net of the effects of acquisitions and divestitures:
Accounts receivable, net		(26	)		(139	)
Inventories		(119	)		(177	)
Prepaid expenses and other current assets		67			(45	)
Accounts payable		(9	)		161
Accrued and other current liabilities		(190	)		(239	)
Income taxes		15			7
Other		(14	)		37
Net cash provided by continuing operating activities		328			283
Net cash provided by (used in) discontinued operating activities		(31	)		67
Net cash provided by operating activities		297			350
Cash Flows From Investing Activities:
Capital expenditures		(210	)		(237	)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation		288			—
Other		4			—
Net cash provided by (used in) continued investing activities		82			(237	)
Net cash used in discontinued investing activities		(2	)		(4	)
Net cash provided by (used in) investing activities		80			(241	)
Cash Flows From Financing Activities:
Net increase in commercial paper		63			241
Proceeds from issuance of debt		350			119
Repayment of debt		(441	)		(708	)
Proceeds from exercise of share options		7			54
Repurchase of common shares		(519	)		(167	)
Payment of common share dividends to shareholders		(150	)		(141	)
Transfers (to) from discontinued operations		(33	)		63
Other		(29	)		(32	)
Net cash used in continuing financing activities		(752	)		(571	)
Net cash provided by (used in) discontinued financing activities		33			(63	)
Net cash used in financing activities		(719	)		(634	)
Effect of currency translation on cash		(1	)		11
Net decrease in cash, cash equivalents, and restricted cash		(343	)		(514	)
Cash, cash equivalents, and restricted cash at beginning of period		848			1,218
Cash, cash equivalents, and restricted cash at end of period	$	505		$	704

See Notes to Condensed Consolidated Financial Statements.

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Basis of Presentation and Accounting Policies

Basis of Presentation

        The unaudited Condensed Consolidated Financial Statements of TE Connectivity Ltd. ("TE Connectivity" or the "Company," which may be referred to as "we," "us," or "our") have been prepared in United States ("U.S.") dollars, in accordance with accounting principles generally accepted in the U.S. ("GAAP") and the instructions to Form 10-Q under the Securities Exchange Act of 1934. In management's opinion, the unaudited Condensed Consolidated Financial Statements contain all normal recurring adjustments necessary for a fair presentation of interim results. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire fiscal year or any subsequent interim period.

        The year-end balance sheet data was derived from audited financial statements, but does not include all of the information and disclosures required by GAAP. These financial statements should be read in conjunction with our audited Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018.

        Unless otherwise indicated, references in the Condensed Consolidated Financial Statements to fiscal 2019 and fiscal 2018 are to our fiscal years ending September 27, 2019 and ended September 28, 2018, respectively.

Revenue Recognition

        We account for revenue in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers, which introduced a single, comprehensive, five-step revenue recognition model. Our revenues are generated principally from the sale of our products. Revenue is recognized as performance obligations under the terms of a contract, such as a purchase order with a customer, are satisfied; generally this occurs with the transfer of control. We transfer control and recognize revenue when we ship product to our customers, the customers accept and have legal title for the product, and we have a right to payment for such product. Revenue is measured as the amount of consideration that we expect to receive in exchange for those products and excludes taxes assessed by governmental authorities and collected from customers concurrent with the sale of products. Shipping and handling costs are treated as fulfillment costs and are included in cost of sales. Since we typically invoice our customers when we satisfy our performance obligations, we do not have material contract assets or contract liabilities. Our credit terms are customary and do not contain significant financing components that extend beyond one year of fulfillment of performance obligations. We apply the practical expedient of ASC 606 with respect to financing components and do not evaluate contracts in which payment is due within one year of satisfaction of the related performance obligation. Since our performance obligations to deliver products are part of contracts that generally have original durations of one year or less, we have elected to use the optional exemption to not disclose the aggregate amount of transaction prices associated with unsatisfied or partially satisfied performance obligations as of December 28, 2018. See Note 15 for net sales disaggregated by industry end market and geographic region which is summarized by segment and that we consider meaningful to depict the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors.

        We generally warrant that our products will conform to our, or mutually agreed to, specifications and that our products will be free from material defects in materials and workmanship for a limited time. We limit our warranty to the replacement or repair of defective parts, or a refund or credit of the

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

1. Basis of Presentation and Accounting Policies (Continued)

price of the defective product. We do not account for these warranties as separate performance obligations.

        Although products are generally sold at fixed prices, certain distributors and customers receive incentives or awards, such as sales rebates, return allowances, scrap allowances, and other rights, which are accounted for as variable consideration. We estimate these amounts in the same period revenue is recognized based on the expected value to be provided to customers and reduce revenue accordingly. Our estimates of variable consideration and ultimate determination of the estimated amounts to include in the transaction price are based primarily on our assessment of anticipated performance and historical and forecasted information that is reasonably available to us.

Recently Adopted Accounting Pronouncements

        In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-12, an update to ASC 815, Derivatives and Hedging. The update improves and simplifies hedge accounting and related disclosures. We elected to early adopt this update, which did not have a material impact on our Condensed Consolidated Financial Statements, in the quarter ended December 28, 2018.

        In October 2016, the FASB issued ASU No. 2016-16, an update to ASC 740, Income Taxes. This guidance requires the recognition of the income tax consequences of intra-entity transfers of assets other than inventory in the period in which the transfer occurs. The update was adopted on a modified retrospective basis in the quarter ended December 28, 2018 and resulted in a $443 million cumulative-effect adjustment to beginning accumulated earnings, which represented the net reversal of all balances associated with deferred tax impacts of intra-entity transfers of assets other than inventory. This included a decrease in other assets of $798 million, an increase in deferred tax assets of $418 million, and a decrease in prepaid expenses and other current assets of $63 million on the Condensed Consolidated Balance Sheet.

        In May 2014, the FASB issued ASU No. 2014-09 which codified ASC 606, Revenue from Contracts with Customers. This guidance supersedes ASC 605, Revenue Recognition, and introduces a single, comprehensive, five-step revenue recognition model. ASC 606 also enhances disclosures related to revenue recognition. We adopted ASC 606, as amended, in the quarter ended December 28, 2018 using a modified retrospective approach. Prior period amounts have not been adjusted and continue to be reported under the accounting standards in effect for those periods. Transition impacts, which relate primarily to incentive compensation arrangements, were not material to our results of operations or financial position. Because the impact of adoption was immaterial, we have not recorded a cumulative-effect adjustment to beginning accumulated earnings.

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

2. Restructuring and Other Charges, Net

        Net restructuring charges by segment were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions	$	21	$	4
Industrial Solutions		35		22
Communications Solutions		19		8
Restructuring charges, net	$	75	$	34

        Activity in our restructuring reserves was as follows:

	Balance at September 28, 2018		Charges		Changes in Estimate			Cash Payments			Non-Cash Items			Currency Translation			Balance at December 28, 2018
	(in millions)
Fiscal 2019 Actions:
Employee severance	$	—	$	67	$	—		$	(4	)	$	—		$	—		$	63
Fiscal 2018 Actions:
Employee severance		114		1		—			(16	)		—			(2	)		97
Facility and other exit costs		4		1		—			(1	)		—			—			4
Property, plant and equipment		—		1		—			—			(1	)		—			—
Total		118		3		—			(17	)		(1	)		(2	)		101
Pre-Fiscal 2018 Actions:
Employee severance		49		4		(1	)		(8	)		—			(1	)		43
Facility and other exit costs		—		1		—			(1	)		—			—			—
Property, plant and equipment		—		1		—			—			(1	)		—			—
Total		49		6		(1	)		(9	)		(1	)		(1	)		43
Total Activity	$	167	$	76	$	(1	)	$	(30	)	$	(2	)	$	(3	)	$	207

Fiscal 2019 Actions

        During fiscal 2019, we initiated a restructuring program associated with footprint consolidation and structural improvements impacting all segments. In connection with this program, during the quarter ended December 28, 2018, we recorded restructuring charges of $67 million. We expect to complete all restructuring actions commenced during the quarter ended December 28, 2018 by the end of fiscal 2020 and to incur additional charges of approximately $10 million primarily in the Industrial Solutions segment.

Fiscal 2018 Actions

        During fiscal 2018, we initiated a restructuring program associated with footprint consolidation and structural improvements primarily impacting the Industrial Solutions and Transportation Solutions

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

2. Restructuring and Other Charges, Net (Continued)

segments. In connection with this program, during the quarters ended December 28, 2018 and December 29, 2017, we recorded restructuring charges of $3 million and $22 million, respectively. We expect to complete all restructuring actions commenced during fiscal 2018 by the end of fiscal 2020 and to incur additional charges of approximately $10 million primarily in the Industrial Solutions segment.

Pre-Fiscal 2018 Actions

        Prior to fiscal 2018, we initiated a restructuring program associated with footprint consolidation related to recent acquisitions and structural improvements impacting all segments. Also prior to fiscal 2018, we initiated a restructuring program associated with headcount reductions impacting all segments and product line closures in the Communications Solutions segment. During the quarters ended December 28, 2018 and December 29, 2017, we recorded net restructuring charges of $5 million and $12 million, respectively, related to pre-fiscal 2018 actions. We expect additional charges related to pre-fiscal 2018 actions to be insignificant.

Total Restructuring Reserves

        Restructuring reserves included on the Condensed Consolidated Balance Sheets were as follows:

	December 28, 2018		September 28, 2018
	(in millions)
Accrued and other current liabilities	$	183	$	141
Other liabilities		24		26
Restructuring reserves	$	207	$	167

3. Discontinued Operations

        During the quarter ended December 28, 2018, we sold our Subsea Communications ("SubCom") business for net cash proceeds of $288 million and incurred a pre-tax loss on sale of $96 million, related primarily to the recognition of cumulative translation adjustment losses of $67 million. The transaction is subject to a final working capital adjustment. The SubCom business met the held for sale and discontinued operations criteria and was reported as such in all periods presented on the Condensed Consolidated Financial Statements. Prior to reclassification to discontinued operations, the SubCom business was included in the Communications Solutions segment.

        In connection with the sale, we contractually agreed to continue to honor performance guarantees and letters of credit related to the SubCom business' projects that existed as of the date of sale. These guarantees have a combined value of approximately $1.7 billion and are expected to expire at various dates through fiscal 2025; however, the majority are expected to expire within two years. At the time of sale, we determined that the fair value of these guarantees was $12 million, which we recognized by a charge to pre-tax loss on sale. Also, under the terms of the definitive agreement, we are required to issue up to $300 million of new performance guarantees, subject to certain limitations, for projects entered into by the SubCom business following the sale for a period of up to three years. During the quarter ended December 28, 2018, we issued a guarantee of $70 million for a new project. We have

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

3. Discontinued Operations (Continued)

contractual recourse against the SubCom business if we are required to perform on any SubCom guarantees; however, based on historical experience, we do not anticipate having to perform.

        The following table presents the summarized components of loss from discontinued operations, net of income taxes, for the SubCom business and prior divestitures:

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Net sales	$	41		$	143
Cost of sales		(50	)		(132	)
Selling, general, and administrative expenses		(4	)		(7	)
Research, development, and engineering expenses		(3	)		(10	)
Restructuring and other charges, net		(3	)		—
Pre-tax loss from discontinued operations		(19	)		(6	)
Pre-tax loss on sale of discontinued operations		(96	)		—
Income tax (expense) benefit		8			(1	)
Loss from discontinued operations, net of income taxes	$	(107	)	$	(7	)

        The following table presents balance sheet information for assets and liabilities held for sale at September 28, 2018; there were no such balances at December 28, 2018:

	September 28, 2018
	(in millions)
Accounts receivable, net	$	72
Inventories		130
Other current assets		32
Property, plant, and equipment, net		221
Other assets		17
Total assets held for sale	$	472
Accounts payable	$	63
Accrued and other current liabilities		26
Deferred revenue		60
Other liabilities		39
Total liabilities held for sale	$	188

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

4. Inventories

        Inventories consisted of the following:

	December 28, 2018		September 28, 2018
	(in millions)
Raw materials	$	306	$	276
Work in progress		735		656
Finished goods		945		925
Inventories	$	1,986	$	1,857

5. Goodwill

        The changes in the carrying amount of goodwill by segment were as follows:

	Transportation Solutions			Industrial Solutions			Communications Solutions			Total
	(in millions)
September 28, 2018(1)	$	1,993		$	3,104		$	587		$	5,684
Currency translation and other		(13	)		(19	)		(4	)		(36	)
December 28, 2018(1)	$	1,980		$	3,085		$	583		$	5,648

(1)

At December 28, 2018 and September 28, 2018, accumulated impairment losses for the Transportation Solutions, Industrial Solutions, and Communications Solutions segments were $2,191 million, $669 million, and $489 million, respectively.

6. Intangible Assets, Net

        Intangible assets consisted of the following:

	December 28, 2018							September 28, 2018
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(in millions)
Customer relationships	$	1,457	$	(410	)	$	1,047	$	1,468	$	(389	)	$	1,079
Intellectual property		1,257		(673	)		584		1,261		(653	)		608
Other		34		(17	)		17		33		(16	)		17
Total	$	2,748	$	(1,100	)	$	1,648	$	2,762	$	(1,058	)	$	1,704

        Intangible asset amortization expense was $45 million for the quarters ended December 28, 2018 and December 29, 2017.

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TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

6. Intangible Assets, Net (Continued)

        At December 28, 2018, the aggregate amortization expense on intangible assets is expected to be as follows:

	(in millions)
Remainder of fiscal 2019	$	136
Fiscal 2020		175
Fiscal 2021		172
Fiscal 2022		172
Fiscal 2023		171
Fiscal 2024		140
Thereafter		682
Total	$	1,648

7. Debt

        During November 2018, Tyco Electronics Group S.A. ("TEGSA"), our 100%-owned subsidiary, issued $350 million aggregate principal amount of senior floating rate notes due June 2020. The notes bear interest at a rate of three-month London Interbank Offered Rate ("LIBOR") plus 0.45% per year. The notes are TEGSA's unsecured senior obligations and rank equally in right of payment with all existing and any future senior indebtedness of TEGSA and senior to any subordinated indebtedness that TEGSA may incur.

        During December 2018, TEGSA repaid, at maturity, $325 million 2.375% senior notes due 2018.

        TEGSA has a five-year unsecured senior revolving credit facility ("Credit Facility") with total commitments of $1,500 million. The Credit Facility was amended in November 2018 primarily to extend the maturity date from December 2020 to November 2023. The amended Credit Facility contains provisions that allow for incremental commitments of up to $500 million, an option to temporarily increase the financial ratio covenant following a qualified acquisition, and borrowings in designated currencies. TEGSA had no borrowings under the Credit Facility at December 28, 2018 or September 28, 2018.

        As of December 28, 2018, TEGSA had $333 million of commercial paper outstanding at a weighted-average interest rate of 2.94%. TEGSA had $270 million of commercial paper outstanding at a weighted-average interest rate of 2.35% at September 28, 2018.

        The fair value of our debt, based on indicative valuations, was approximately $4,091 million and $4,149 million at December 28, 2018 and September 28, 2018, respectively.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

8. Commitments and Contingencies

Legal Proceedings

        In the normal course of business, we are subject to various legal proceedings and claims, including patent infringement claims, product liability matters, employment disputes, disputes on agreements, other commercial disputes, environmental matters, antitrust claims, and tax matters, including non-income tax matters such as value added tax, sales and use tax, real estate tax, and transfer tax. Although it is not feasible to predict the outcome of these proceedings, based upon our experience, current information, and applicable law, we do not expect that the outcome of these proceedings, either individually or in the aggregate, will have a material effect on our results of operations, financial position, or cash flows.

Environmental Matters

        We are involved in various stages of investigation and cleanup related to environmental remediation matters at a number of sites. The ultimate cost of site cleanup is difficult to predict given the uncertainties regarding the extent of the required cleanup, the interpretation of applicable laws and regulations, and alternative cleanup methods. As of December 28, 2018, we concluded that we would incur investigation and remediation costs at these sites in the reasonably possible range of $15 million to $44 million, and we accrued $17 million as the probable loss, which was the best estimate within this range. We believe that any potential payment of such estimated amounts will not have a material adverse effect on our results of operations, financial position, or cash flows.

Guarantees

        In disposing of assets or businesses, we often provide representations, warranties, and/or indemnities to cover various risks including unknown damage to assets, environmental risks involved in the sale of real estate, liability for investigation and remediation of environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not expect that these uncertainties will have a material adverse effect on our results of operations, financial position, or cash flows.

        At December 28, 2018, we had outstanding letters of credit, letters of guarantee, and surety bonds of $286 million.

        We sold our SubCom business during the quarter ended December 28, 2018. In connection with the sale, we contractually agreed to honor certain performance guarantees and letters of credit related to the SubCom business. See Note 3 for additional information regarding these guarantees and the divestiture of the SubCom business.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

9. Financial Instruments

Foreign Currency Exchange Rate Risk

        During fiscal 2015, we entered into cross-currency swap contracts with an aggregate notional value of €1,000 million to reduce our exposure to foreign currency exchange rate risk associated with certain intercompany loans. Under the terms of these contracts, which have been designated as cash flow hedges, we make interest payments in euros at 3.50% per annum and receive interest in U.S. dollars at a weighted-average rate of 5.33% per annum. Upon maturity of these contracts in fiscal 2022, we will pay the notional value of the contracts in euros and receive U.S. dollars from our counterparties. In connection with the cross-currency swap contracts, we are required to post cash collateral with our counterparties.

        At December 28, 2018 and September 28, 2018, our cross-currency swap contracts were in liability positions of $64 million and $100 million, respectively, and were recorded in other liabilities on the Condensed Consolidated Balance Sheets. At December 28, 2018 and September 28, 2018, collateral paid to our counterparties approximated the derivative positions and was recorded in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets. The impacts of our cross-currency swap contracts were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Gains (losses) recorded in other comprehensive income (loss)	$	19	$	(10	)
Gains (losses) excluded from the hedging relationship(1)		17		(19	)

(1)

Gains and losses excluded from the hedging relationship are recognized prospectively in selling, general, and administrative expenses and are offset by losses and gains generated as a result of re-measuring certain intercompany loans to the U.S. dollar.

Hedge of Net Investment

        During fiscal 2019, we expanded our cross-currency swap program to hedge our net investment in certain foreign operations. The aggregate notional value of this program was $952 million at December 28, 2018. Under the terms of these contracts, we receive interest in U.S. dollars at a weighted-average rate of 3.06% per annum and pay no interest. Upon maturity of these contracts at various dates through fiscal 2022, we will pay the notional value of the contracts in the designated foreign currency and receive U.S. dollars from our counterparties.

        In addition to the cross-currency swap program, we hedge our net investment in certain foreign operations using intercompany loans and external borrowings denominated in the same currencies. The aggregate notional value of these hedges was $3,189 million and $4,064 million at December 28, 2018 and September 28, 2018, respectively.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

9. Financial Instruments (Continued)

        The impacts of our hedging programs were as follows:

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Foreign currency exchange gains (losses) on intercompany loans and external borrowings(1)	$	76		$	(66	)
Losses on cross-currency swaps designated as hedge of net investment(2)		(5	)		—

(1)

Foreign currency exchange gains and losses on intercompany loans and external borrowings are recorded as currency translation, a component of accumulated other comprehensive income (loss), and are offset by changes attributable to the translation of the net investment.

(2)

Gains and losses on cross-currency swaps designated as hedge of net investment are recorded as currency translation.

10. Retirement Plans

        The net periodic pension benefit cost for all non-U.S. and U.S. defined benefit pension plans was as follows:

	Non-U.S. Plans						U.S. Plans
	For the Quarters Ended						For the Quarters Ended
	December 28, 2018			December 29, 2017			December 28, 2018			December 29, 2017
	(in millions)
Service cost	$	12		$	12		$	3		$	3
Interest cost		11			10			12			11
Expected return on plan assets		(16	)		(17	)		(14	)		(15	)
Amortization of net actuarial loss		6			6			4			6
Amortization of prior service credit		(2	)		(2	)		—			—
Net periodic pension benefit cost	$	11		$	9		$	5		$	5

        The components of net periodic pension benefit cost other than service cost are included in net other income (expense) on the Condensed Consolidated Statements of Operations.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

11. Income Taxes

        We recorded income tax expense of $78 million and $599 million for the quarters ended December 28, 2018 and December 29, 2017, respectively. The income tax expense for the quarter ended December 29, 2017 included $567 million of income tax expense related to the tax impacts of the Tax Cuts and Jobs Act (the "Act") and a $61 million net income tax benefit related to certain legal entity restructurings. During the quarter ended December 29, 2017, the period of enactment of the Act, we were required to revalue our U.S. federal deferred tax assets and liabilities at a U.S. federal corporate tax rate of 21% and we recorded income tax expense of $567 million primarily in connection with the write-down of our U.S. federal deferred tax asset for net operating loss and interest carryforwards. Included in the expense of $567 million was an income tax benefit of $34 million related to the reduction in the existing valuation allowance recorded against certain U.S. federal tax credit carryforwards.

        We record accrued interest and penalties related to uncertain tax positions as part of income tax expense. As of December 28, 2018 and September 28, 2018, we had $63 million and $60 million, respectively, of accrued interest and penalties related to uncertain tax positions on the Condensed Consolidated Balance Sheets, recorded primarily in income taxes.

        Although it is difficult to predict the timing or results of our worldwide examinations, we estimate that up to approximately $125 million of unrecognized income tax benefits, excluding the impact relating to accrued interest and penalties, could be resolved within the next twelve months.

        We are not aware of any other matters that would result in significant changes to the amount of unrecognized income tax benefits reflected on the Condensed Consolidated Balance Sheet as of December 28, 2018.

Tax Sharing Agreement

        Under a Tax Sharing Agreement, we, Tyco International plc ("Tyco International"), and Covidien plc ("Covidien") share 31%, 27%, and 42%, respectively, of income tax liabilities that arise from adjustments made by tax authorities to the collective income tax returns for periods prior to and including June 29, 2007. Pursuant to the Tax Sharing Agreement, we entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. We have substantially settled all U.S. federal income tax matters with the IRS for periods covered under the Tax Sharing Agreement. Certain shared U.S. state and non-U.S. income tax matters remain open. We do not expect these matters will have a material effect on our results of operations, financial position, or cash flows. As a result of subsequent transactions, Tyco International and Covidien now operate as part of Johnson Controls International plc and Medtronic plc, respectively.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

12. Earnings (Loss) Per Share

        The weighted-average number of shares outstanding used in the computations of basic and diluted earnings (loss) per share were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Basic		342		352
Dilutive impact of share-based compensation arrangements		2		—
Diluted		344		352

        There were one million share options that were not included in the computation of diluted earnings (loss) per share for the quarters ended December 28, 2018 and December 29, 2017 because the instruments' underlying exercise prices were greater than the average market prices of our common shares and inclusion would be antidilutive.

        For the quarter ended December 29, 2017, there were three million nonvested share awards and options outstanding with underlying exercise prices less than the average market prices of our common shares; however, these were excluded from the calculation of diluted loss per share as inclusion would be antidilutive as a result of our loss during the period.

13. Shareholders' Equity

Dividends

        We paid cash dividends to shareholders of $0.44 and $0.40 per share during the quarters ended December 28, 2018 and December 29, 2017, respectively.

        Upon shareholders' approval of a dividend payment, we record a liability with a corresponding charge to shareholders' equity. At December 28, 2018 and September 28, 2018, the unpaid portion of the dividends recorded in accrued and other current liabilities on the Condensed Consolidated Balance Sheets totaled $149 million and $303 million, respectively.

Share Repurchase Program

        During the quarter ended December 28, 2018, our board of directors authorized an increase of $1.5 billion in the share repurchase program. Common shares repurchased under the share repurchase program were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Number of common shares repurchased		6		2
Repurchase value	$	495	$	214

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

13. Shareholders' Equity (Continued)

        At December 28, 2018, we had $2.0 billion of availability remaining under our share repurchase authorization.

14. Share Plans

        Share-based compensation expense, which was included in selling, general, and administrative expenses on the Condensed Consolidated Statements of Operations, was as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Share-based compensation expense	$	23	$	28

        As of December 28, 2018, there was $179 million of unrecognized compensation expense related to share-based awards, which is expected to be recognized over a weighted-average period of 2.3 years.

        During the quarter ended December 28, 2018, we granted the following share-based awards as part of our annual incentive plan grant:

	Shares		Grant-Date Fair Value
	(in millions)
Share options		1.6	$	13.36
Restricted share awards		0.6		76.66
Performance share awards		0.2		76.66

        As of December 28, 2018, we had 17 million shares available for issuance under our stock and incentive plans, of which the TE Connectivity Ltd. 2007 Stock and Incentive Plan, amended and restated as of March 8, 2017, was the primary plan.

Share-Based Compensation Assumptions

        The assumptions we used in the Black-Scholes-Merton option pricing model for the options granted as part of our annual incentive plan grant were as follows:

Expected share price volatility		20	%
Risk free interest rate		3.0	%
Expected annual dividend per share	$	1.76
Expected life of options (in years)		5.2

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

15. Segment and Geographic Data

        Net sales by segment⁽¹⁾ and industry end market⁽²⁾ were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions:
Automotive	$	1,469	$	1,517
Commercial transportation		297		300
Sensors		220		215
Total Transportation Solutions		1,986		2,032
Industrial Solutions:
Industrial equipment		483		471
Aerospace, defense, oil, and gas		285		254
Energy		160		157
Total Industrial Solutions		928		882
Communications Solutions:
Data and devices		257		238
Appliances		176		184
Total Communications Solutions		433		422
Total	$	3,347	$	3,336

(1)

Intersegment sales were not material and were recorded at selling prices that approximated market prices.

(2)

Industry end market information is presented consistently with our internal management reporting and may be revised periodically as management deems necessary.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

15. Segment and Geographic Data (Continued)

        Net sales by geographic region⁽¹⁾ and segment were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Europe/Middle East/Africa ("EMEA"):
Transportation Solutions	$	756	$	808
Industrial Solutions		350		344
Communications Solutions		65		66
Total EMEA		1,171		1,218
Asia–Pacific:
Transportation Solutions		764		805
Industrial Solutions		155		163
Communications Solutions		254		252
Total Asia–Pacific		1,173		1,220
Americas:
Transportation Solutions		466		419
Industrial Solutions		423		375
Communications Solutions		114		104
Total Americas		1,003		898
Total	$	3,347	$	3,336

(1)

Net sales to external customers are attributed to individual countries based on the legal entity that records the sale.

        Operating income by segment was as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions	$	332	$	417
Industrial Solutions		100		102
Communications Solutions		52		67
Total	$	484	$	586

20

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

16. Tyco Electronics Group S.A.

        Tyco Electronics Group S.A. ("TEGSA"), a Luxembourg company and our 100%-owned subsidiary, is a holding company that owns, directly or indirectly, all of our operating subsidiaries. TEGSA is the obligor under our senior notes, commercial paper, and Credit Facility, which are fully and unconditionally guaranteed by its parent, TE Connectivity Ltd. The following tables present condensed consolidating financial information for TE Connectivity Ltd., TEGSA, and all other subsidiaries that are not providing a guarantee of debt but which represent assets of TEGSA, using the equity method of accounting.

Condensed Consolidating Statement of Operations (unaudited)
For the Quarter Ended December 28, 2018

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Net sales	$	—		$	—		$	3,347		$	—		$	3,347
Cost of sales		—			—			2,233			—			2,233
Gross margin		—			—			1,114			—			1,114
Selling, general, and administrative expenses, net(1)		35			(107	)		461			—			389
Research, development, and engineering expenses		—			—			161			—			161
Acquisition and integration costs		—			—			5			—			5
Restructuring and other charges, net		—			—			75			—			75
Operating income (loss)		(35	)		107			412			—			484
Interest income		—			—			5			—			5
Interest expense		—			(27	)		—			—			(27	)
Other expense, net		—			—			(1	)		—			(1	)
Equity in net income of subsidiaries		441			389			—			(830	)		—
Equity in net loss of subsidiaries of discontinued operations		(107	)		(49	)		—			156			—
Intercompany interest income (expense), net		(23	)		(28	)		51			—			—
Income from continuing operations before income taxes		276			392			467			(674	)		461
Income tax expense		—			—			(78	)		—			(78	)
Income from continuing operations		276			392			389			(674	)		383
Loss from discontinued operations, net of income taxes		—			(58	)		(49	)		—			(107	)
Net income		276			334			340			(674	)		276
Other comprehensive income		49			49			35			(84	)		49
Comprehensive income	$	325		$	383		$	375		$	(758	)	$	325

(1)

TEGSA selling, general, and administrative expenses include gains of $110 million related to intercompany transactions. These gains are offset by corresponding losses recorded by other subsidiaries.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

16. Tyco Electronics Group S.A. (Continued)

Condensed Consolidating Statement of Operations (unaudited)
For the Quarter Ended December 29, 2017

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Net sales	$	—		$	—		$	3,336		$	—		$	3,336
Cost of sales		—			—			2,172			—			2,172
Gross margin		—			—			1,164			—			1,164
Selling, general, and administrative expenses, net		47			(3	)		333			—			377
Research, development, and engineering expenses		—			—			165			—			165
Acquisition and integration costs		—			—			2			—			2
Restructuring and other charges, net		—			—			34			—			34
Operating income (loss)		(47	)		3			630			—			586
Interest income		—			—			4			—			4
Interest expense		—			(26	)		—			—			(26	)
Other income, net		—			—			2			—			2
Equity in net income of subsidiaries		27			22			—			(49	)		—
Equity in net loss of subsidiaries of discontinued operations		(7	)		(7	)		—			14			—
Intercompany interest income (expense), net		(13	)		28			(15	)		—			—
Income (loss) from continuing operations before income taxes		(40	)		20			621			(35	)		566
Income tax expense		—			—			(599	)		—			(599	)
Income (loss) from continuing operations		(40	)		20			22			(35	)		(33	)
Loss from discontinued operations, net of income taxes		—			—			(7	)		—			(7	)
Net income (loss)		(40	)		20			15			(35	)		(40	)
Other comprehensive income		76			76			87			(163	)		76
Comprehensive income	$	36		$	96		$	102		$	(198	)	$	36

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

16. Tyco Electronics Group S.A. (Continued)

Condensed Consolidating Balance Sheet (unaudited)
As of December 28, 2018

	TE Connectivity Ltd.		TEGSA		Other Subsidiaries		Consolidating Adjustments			Total
	(in millions)
Assets
Current assets:
Cash and cash equivalents	$	—	$	—	$	505	$	—		$	505
Accounts receivable, net		—		—		2,380		—			2,380
Inventories		—		—		1,986		—			1,986
Intercompany receivables		51		3,096		60		(3,207	)		—
Prepaid expenses and other current assets		4		68		435		—			507
Total current assets		55		3,164		5,366		(3,207	)		5,378
Property, plant, and equipment, net		—		—		3,550		—			3,550
Goodwill		—		—		5,648		—			5,648
Intangible assets, net		—		—		1,648		—			1,648
Deferred income taxes		—		—		2,580		—			2,580
Investment in subsidiaries		13,557		26,537		—		(40,094	)		—
Intercompany loans receivable		2		1,598		13,646		(15,246	)		—
Other assets		—		1		383		—			384
Total Assets	$	13,614	$	31,300	$	32,821	$	(58,547	)	$	19,188
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	—	$	583	$	2	$	—		$	585
Accounts payable		2		—		1,536		—			1,538
Accrued and other current liabilities		220		53		1,075		—			1,348
Intercompany payables		3,156		—		51		(3,207	)		—
Total current liabilities		3,378		636		2,664		(3,207	)		3,471
Long-term debt		—		3,379		3		—			3,382
Intercompany loans payable		—		13,648		1,598		(15,246	)		—
Long-term pension and postretirement liabilities		—		—		1,101		—			1,101
Deferred income taxes		—		—		207		—			207
Income taxes		—		—		335		—			335
Other liabilities		—		80		376		—			456
Total Liabilities		3,378		17,743		6,284		(18,453	)		8,952
Total Shareholders' Equity		10,236		13,557		26,537		(40,094	)		10,236
Total Liabilities and Shareholders' Equity	$	13,614	$	31,300	$	32,821	$	(58,547	)	$	19,188

23

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

16. Tyco Electronics Group S.A. (Continued)

Condensed Consolidating Balance Sheet (unaudited)
As of September 28, 2018

	TE Connectivity Ltd.		TEGSA		Other Subsidiaries		Consolidating Adjustments			Total
	(in millions)
Assets
Current assets:
Cash and cash equivalents	$	—	$	—	$	848	$	—		$	848
Accounts receivable, net		—		—		2,361		—			2,361
Inventories		—		—		1,857		—			1,857
Intercompany receivables		37		2,391		48		(2,476	)		—
Prepaid expenses and other current assets		5		112		544		—			661
Current assets held for sale		—		—		472		—			472
Total current assets		42		2,503		6,130		(2,476	)		6,199
Property, plant, and equipment, net		—		—		3,497		—			3,497
Goodwill		—		—		5,684		—			5,684
Intangible assets, net		—		—		1,704		—			1,704
Deferred income taxes		—		—		2,144		—			2,144
Investment in subsidiaries		13,626		26,613		—		(40,239	)		—
Intercompany loans receivable		2		6,535		17,887		(24,424	)		—
Other assets		—		—		1,158		—			1,158
Total Assets	$	13,670	$	35,651	$	38,204	$	(67,139	)	$	20,386
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	—	$	961	$	2	$	—		$	963
Accounts payable		2		—		1,546		—			1,548
Accrued and other current liabilities		400		36		1,275		—			1,711
Intercompany payables		2,437		—		39		(2,476	)		—
Current liabilities held for sale		—		—		188		—			188
Total current liabilities		2,839		997		3,050		(2,476	)		4,410
Long-term debt		—		3,033		4		—			3,037
Intercompany loans payable		—		17,888		6,536		(24,424	)		—
Long-term pension and postretirement liabilities		—		—		1,102		—			1,102
Deferred income taxes		—		—		207		—			207
Income taxes		—		—		312		—			312
Other liabilities		—		107		380		—			487
Total Liabilities		2,839		22,025		11,591		(26,900	)		9,555
Total Shareholders' Equity		10,831		13,626		26,613		(40,239	)		10,831
Total Liabilities and Shareholders' Equity	$	13,670	$	35,651	$	38,204	$	(67,139	)	$	20,386

24

TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

16. Tyco Electronics Group S.A. (Continued)

Condensed Consolidating Statement of Cash Flows (unaudited)
For the Quarter Ended December 28, 2018

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	$	(73	)	$	(9	)	$	410		$	—		$	328
Net cash used in discontinued operating activities		—			—			(31	)		—			(31	)
Net cash provided by (used in) operating activities		(73	)		(9	)		379			—			297
Cash Flows From Investing Activities:
Capital expenditures		—			—			(210	)		—			(210	)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation		—			303			(15	)		—			288
Change in intercompany loans		—			(25	)		—			25			—
Other		—			—			4			—			4
Net cash provided by (used in) continuing investing activities		—			278			(221	)		25			82
Net cash used in discontinued investing activities		—			—			(2	)		—			(2	)
Net cash provided by (used in) investing activities		—			278			(223	)		25			80
Cash Flows From Financing Activities:
Changes in parent company equity(1)		23			(240	)		217			—			—
Net increase in commercial paper		—			63			—			—			63
Proceeds from issuance of debt		—			350			—			—			350
Repayment of debt		—			(441	)		—			—			(441	)
Proceeds from exercise of share options		—			—			7			—			7
Repurchase of common shares		(519	)		—			—			—			(519	)
Payment of common share dividends to shareholders		(150	)		—			—			—			(150	)
Transfer to discontinued operations		—			—			(33	)		—			(33	)
Loan activity with parent		719			—			(694	)		(25	)		—
Other		—			(1	)		(28	)		—			(29	)
Net cash provided by (used in) continuing financing activities		73			(269	)		(531	)		(25	)		(752	)
Net cash provided by discontinued financing activities		—			—			33			—			33
Net cash provided by (used in) financing activities		73			(269	)		(498	)		(25	)		(719	)
Effect of currency translation on cash		—			—			(1	)		—			(1	)
Net decrease in cash, cash equivalents, and restricted cash		—			—			(343	)		—			(343	)
Cash, cash equivalents, and restricted cash at beginning of period		—			—			848			—			848
Cash, cash equivalents, and restricted cash at end of period	$	—		$	—		$	505		$	—		$	505

(1)

Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity.

25

TE CONNECTIVITY LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

16. Tyco Electronics Group S.A. (Continued)

Condensed Consolidating Statement of Cash Flows (unaudited)
For the Quarter Ended December 29, 2017

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities(1)	$	(51	)	$	(10	)	$	351		$	(7	)	$	283
Net cash provided by discontinued operating activities		—			—			67			—			67
Net cash provided by (used in) operating activities		(51	)		(10	)		418			(7	)		350
Cash Flows From Investing Activities:
Capital expenditures		—			—			(237	)		—			(237	)
Change in intercompany loans		—			335			—			(335	)		—
Intercompany distribution receipts(1)		—			23			—			(23	)		—
Net cash provided by (used in) continuing investing activities		—			358			(237	)		(358	)		(237	)
Net cash used in discontinued investing activities		—			—			(4	)		—			(4	)
Net cash provided by (used in) investing activities		—			358			(241	)		(358	)		(241	)
Cash Flows From Financing Activities:
Changes in parent company equity(2)		30			—			(30	)		—			—
Net increase in commercial paper		—			241			—			—			241
Proceeds from issuance of debt		—			119			—			—			119
Repayment of debt		—			(708	)		—			—			(708	)
Proceeds from exercise of share options		—			—			54			—			54
Repurchase of common shares		(108	)		—			(59	)		—			(167	)
Payment of common share dividends to shareholders		(143	)		—			2			—			(141	)
Transfer from discontinued operations		—			—			63			—			63
Intercompany distributions(1)		—			—			(30	)		30			—
Loan activity with parent		272			—			(607	)		335			—
Other		—			—			(32	)		—			(32	)
Net cash provided by (used in) continuing financing activities		51			(348	)		(639	)		365			(571	)
Net cash used in discontinued financing activities		—			—			(63	)		—			(63	)
Net cash provided by (used in) financing activities		51			(348	)		(702	)		365			(634	)
Effect of currency translation on cash		—			—			11			—			11
Net decrease in cash, cash equivalents, and restricted cash		—			—			(514	)		—			(514	)
Cash, cash equivalents, and restricted cash at beginning of period		—			—			1,218			—			1,218
Cash, cash equivalents, and restricted cash at end of period	$	—		$	—		$	704		$	—		$	704

(1)

During fiscal 2018, other subsidiaries made distributions to TEGSA in the amount of $30 million. Cash flows are presented based upon the nature of the distributions.

(2)

Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity.

26

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

        The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q. The following discussion may contain forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in these forward-looking statements as a result of many factors, including but not limited to those under the heading "Forward-Looking Information" and "Part II. Item 1A. Risk Factors."

        Our Condensed Consolidated Financial Statements have been prepared in United States ("U.S.") dollars, in accordance with accounting principles generally accepted in the U.S. ("GAAP").

        The following discussion includes organic net sales growth which is a non-GAAP financial measure. See "Non-GAAP Financial Measure" for additional information regarding this measure.

Overview

        TE Connectivity Ltd. ("TE Connectivity" or the "Company," which may be referred to as "we," "us," or "our") is a global technology and manufacturing leader creating a safer, sustainable, productive, and connected future. For more than 75 years, our connectivity and sensor solutions, proven in the harshest environments, have enabled advancements in transportation, industrial applications, medical technology, energy, data communications, and the home.

        Highlights for the first quarter of fiscal 2019 include the following:

•

Our net sales in the first quarter of fiscal 2019 increased marginally relative to first quarter fiscal 2018 sales levels, with sales growth in the Industrial Solutions and Communications Solutions segments offset by declines in the Transportation Solutions segment. On an organic basis, our net sales increased 1.9% during the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018.

•

Our net sales by segment were as follows:

•

Transportation Solutions—Our net sales decreased 2.3% in the first quarter of fiscal 2019 due primarily to sales declines in the automotive end market.

•

Industrial Solutions—Our net sales increased 5.2% during the first quarter of fiscal 2019 primarily as a result of increased sales in the aerospace, defense, oil, and gas end market.

•

Communications Solutions—Our net sales increased 2.6% in the first quarter of fiscal 2019 due primarily to sales increases in the data and devices end market.

•

Net cash provided by continuing operating activities was $328 million in the first quarter of fiscal 2019.

Outlook

        In the second quarter of fiscal 2019, we expect our net sales to be between $3.3 billion and $3.4 billion as compared to $3.6 billion in the second quarter of fiscal 2018. This decrease reflects sales declines in the Transportation Solutions and, to a lesser degree, the Communications Solutions segments relative to the second quarter of fiscal 2018. Additional information regarding expectations

27

for our reportable segments for the second quarter of fiscal 2019 as compared to the same period of fiscal 2018 is as follows:

•

Transportation Solutions—We expect our net sales to decrease in the automotive end market due primarily to market weakness in China and, to a lesser degree, the Europe/Middle East/Africa ("EMEA") region. We expect global automotive production to decline approximately 9% in the second quarter of fiscal 2019.

•

Industrial Solutions—We expect our net sales growth in the aerospace, defense, oil, and gas end market to be offset by declines in the industrial equipment end market, where weakness in factory automation and controls applications is expected to be partially offset by growth in medical applications.

•

Communications Solutions—We expect our net sales to decline in the appliances and the data and devices end markets primarily as a result of market weakness in the Asia–Pacific region.

We expect diluted earnings per share from continuing operations to be in the range of $1.13 to $1.17 per share in the second quarter of fiscal 2019. This outlook reflects the negative impact of foreign currency exchange rates on net sales and earnings per share of approximately $155 million and $0.05 per share, respectively, in the second quarter of fiscal 2019 as compared to the second quarter of fiscal 2018.

        For fiscal 2019, we expect our net sales to be between $13.45 billion and $13.85 billion as compared to $14.0 billion in fiscal 2018. This decrease is driven by sales declines in the Transportation Solutions and Communications Solutions segments relative to fiscal 2018. Additional information regarding expectations for our reportable segments for fiscal 2019 compared to fiscal 2018 is as follows:

•

Transportation Solutions—We expect our net sales to decrease in the automotive end market due primarily to market weakness in China and, to a lesser degree, the EMEA region. We expect global automotive production to decline 4-5% in fiscal 2019.

•

Industrial Solutions—We expect our net sales increase in the aerospace, defense, oil, and gas end market to be offset by declines in the energy end market.

•

Communications Solutions—We expect our net sales to decline in the appliances and the data and devices end markets due primarily to market weakness in the Asia–Pacific region.

We expect diluted earnings per share from continuing operations to be in the range of $4.94 to $5.14 per share in fiscal 2019. This outlook reflects the negative impact of foreign currency exchange rates on net sales and earnings per share of approximately $375 million and $0.16 per share, respectively, in fiscal 2019 as compared to fiscal 2018.

        The above outlook is based on foreign currency exchange rates and commodity prices that are consistent with current levels.

        We are monitoring the current macroeconomic environment and its potential effects on our customers and the end markets we serve. We continue to closely manage our costs in line with economic conditions. Additionally, we are managing our capital resources and monitoring capital availability to ensure that we have sufficient resources to fund future capital needs. See further discussion in "Liquidity and Capital Resources."

Discontinued Operations

        During the first quarter of fiscal 2019, we sold our Subsea Communications ("SubCom") business for net cash proceeds of $288 million and incurred a pre-tax loss on sale of $96 million. The SubCom business met the held for sale and discontinued operations criteria and was reported as such in all periods presented on the Condensed Consolidated Financial Statements. Prior to reclassification to

28

discontinued operations, the SubCom business was included in the Communications Solutions segment. See Note 3 to the Condensed Consolidated Financial Statements for additional information regarding discontinued operations.

Results of Operations

Net Sales

        The following table presents our net sales and the percentage of total net sales by segment:

	For the Quarters Ended
	December 28, 2018				December 29, 2017
	($ in millions)
Transportation Solutions	$	1,986	59	%	$	2,032	61	%
Industrial Solutions		928	28			882	26
Communications Solutions		433	13			422	13
Total	$	3,347	100	%	$	3,336	100	%

        The following table provides an analysis of the change in our net sales by segment:

	Change in Net Sales for the Quarter Ended December 28, 2018 versus Net Sales for the Quarter Ended December 29, 2017
	Net Sales Growth					Organic Net Sales Growth				Translation			Acquisition
	($ in millions)
Transportation Solutions	$	(46	)	(2.3	)%	$	4	0.2	%	$	(50	)	$	—
Industrial Solutions		46		5.2			40	4.5			(15	)		21
Communications Solutions		11		2.6			19	4.6			(8	)		—
Total	$	11		0.3	%	$	63	1.9	%	$	(73	)	$	21

        Net sales increased slightly in the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018. The increase in net sales resulting from organic net sales growth of 1.9% and sales contributions from an acquisition of 0.6% was offset by the negative impact of foreign currency translation of 2.2% due to the weakening of certain foreign currencies. Price erosion adversely affected organic net sales by $28 million in the first quarter of fiscal 2019.

        See further discussion of net sales below under "Segment Results."

        Net Sales by Geographic Region.    Our business operates in three geographic regions—EMEA, Asia–Pacific and the Americas—and our results of operations are influenced by changes in foreign currency exchange rates. Increases or decreases in the value of the U.S. dollar, compared to other currencies, will directly affect our reported results as we translate those currencies into U.S. dollars at the end of each fiscal period.

        Approximately 60% of our net sales were invoiced in currencies other than the U.S. dollar in the first quarter of fiscal 2019.

29

        The following table presents our net sales and the percentage of total net sales by geographic region⁽¹⁾:

	For the Quarters Ended
	December 28, 2018				December 29, 2017
	($ in millions)
EMEA	$	1,171	35	%	$	1,218	36	%
Asia–Pacific		1,173	35			1,220	37
Americas		1,003	30			898	27
Total	$	3,347	100	%	$	3,336	100	%

(1)

Net sales to external customers are attributed to individual countries based on the legal entity that records the sale.

        The following table provides an analysis of the change in our net sales by geographic region:

	Change in Net Sales for the Quarter Ended December 28, 2018 versus Net Sales for the Quarter Ended December 29, 2017
	Net Sales Growth					Organic Net Sales Growth					Translation			Acquisition
	($ in millions)
EMEA	$	(47	)	(3.9	)%	$	(24	)	(2.0	)%	$	(36	)	$	13
Asia–Pacific		(47	)	(3.9	)		(22	)	(1.8	)		(27	)		2
Americas		105		11.7			109		12.2			(10	)		6
Total	$	11		0.3	%	$	63		1.9	%	$	(73	)	$	21

Cost of Sales and Gross Margin

        The following table presents cost of sales and gross margin information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Cost of sales	$	2,233		$	2,172		$	61
As a percentage of net sales		66.7	%		65.1	%
Gross margin	$	1,114		$	1,164		$	(50	)
As a percentage of net sales		33.3	%		34.9	%

        Gross margin decreased $50 million in the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018. The decrease in gross margin was due primarily to price erosion, the negative impact of foreign currency translation, and lower manufacturing productivity, partially offset by lower material costs. Gross margin as a percentage of net sales decreased to 33.3% in the first quarter of 2019 from 34.9% in the first quarter of fiscal 2018.

        Cost of sales and gross margin are subject to variability in raw material prices which continue to fluctuate for many of the raw materials used in the manufacture of our products. We expect to purchase approximately 190 million pounds of copper, 145,000 troy ounces of gold, and 2.7 million troy

30

ounces of silver in fiscal 2019. The following table presents the average prices incurred related to copper, gold, and silver:

		For the Quarters Ended
	Measure	December 28, 2018		December 29, 2017
Copper	Lb.	$	2.88	$	2.79
Gold	Troy oz.		1,293		1,265
Silver	Troy oz.		16.60		17.09

Operating Expenses

        The following table presents operating expense information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Selling, general, and administrative expenses	$	389		$	377		$	12
As a percentage of net sales		11.6	%		11.3	%
Restructuring and other charges, net	$	75		$	34		$	41

        Selling, General, and Administrative Expenses.    Selling, general, and administrative expenses increased $12 million in the first quarter of fiscal 2019 from the first quarter of fiscal 2018. The increase resulted primarily from a gain on the sale of certain assets in the first quarter of fiscal 2018. Selling, general, and administrative expenses as a percentage of net sales increased to 11.6% in the first quarter of fiscal 2019 from 11.3% in the first quarter of fiscal 2018.

        Restructuring and Other Charges, Net.    We are committed to continuous productivity improvements and consistently evaluate opportunities to simplify our global manufacturing footprint, migrate facilities to lower-cost regions, reduce fixed costs, and eliminate excess capacity. These initiatives are designed to help us maintain our competitiveness in the industry, improve our operating leverage, and position us for future growth.

        During fiscal 2019, we initiated a restructuring program associated with footprint consolidation and structural improvements impacting all segments. During fiscal 2018, we initiated a restructuring program associated with footprint consolidation and structural improvements primarily impacting the Industrial Solutions and Transportation Solutions segments.

        In connection with these initiatives, we incurred net restructuring charges of $75 million during the first quarter of fiscal 2019, of which $67 million related to the fiscal 2019 restructuring program. Annualized cost savings related to fiscal 2019 actions commenced during the first quarter of fiscal 2019 are expected to be approximately $60 million and are expected to be realized by the end of fiscal 2020. Cost savings will be reflected primarily in cost of sales and selling, general, and administrative expenses. Currently, we expect fiscal 2019 net restructuring charges to be at least at fiscal 2018 levels, and we expect total spending, which will be funded with cash from operations, to be approximately $160 million. However, as a result of market conditions, we are considering restructuring options and may broaden the scope of our cost initiatives and accelerate cost reduction and footprint consolidation activities.

        See Note 2 to the Condensed Consolidated Financial Statements for additional information regarding net restructuring and other charges.

31

Operating Income

        The following table presents operating income and operating margin information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Operating income	$	484		$	586		$	(102	)
Operating margin		14.5	%		17.6	%

        Operating income included the following:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Acquisition related charges:
Acquisition and integration costs	$	5	$	2
Charges associated with the amortization of acquisition related fair value adjustments		1		5
		6		7
Restructuring and other charges, net		75		34
Total	$	81	$	41

        See discussion of operating income below under "Segment Results."

Non-Operating Items

        The following table presents select non-operating information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Income tax expense	$	78		$	599		$	(521	)
Effective tax rate		16.9	%		105.8	%
Loss from discontinued operations, net of income taxes	$	(107	)	$	(7	)	$	(100	)

        Income Taxes.    See Note 11 to the Condensed Consolidated Financial Statements for discussion of items impacting income tax expense for the first quarters of fiscal 2019 and 2018.

        Loss from Discontinued Operations, Net of Income Taxes.    During the first quarter of fiscal 2019, we sold our SubCom business for net cash proceeds of $288 million and incurred a pre-tax loss on sale of $96 million. The transaction is subject to a final working capital adjustment. The net sales of the business were $41 million and $143 million in the first quarters of fiscal 2019 and 2018, respectively. The results for the first quarter of fiscal 2019 represent one month of activity. In the first quarter of fiscal 2018, net sales and operating income were negatively impacted by production delays on a program. See Note 3 to the Condensed Consolidated Financial Statements for additional information regarding discontinued operations.

32

Segment Results

Transportation Solutions

        Net Sales.    The following table presents the Transportation Solutions segment's net sales and the percentage of total net sales by primary industry end market⁽¹⁾:

	For the Quarters Ended
	December 28, 2018				December 29, 2017
	($ in millions)
Automotive	$	1,469	74	%	$	1,517	74	%
Commercial transportation		297	15			300	15
Sensors		220	11			215	11
Total	$	1,986	100	%	$	2,032	100	%

(1)

Industry end market information is presented consistently with our internal management reporting and may be revised periodically as management deems necessary.

        The following table provides an analysis of the change in the Transportation Solutions segment's net sales by primary industry end market:

	Change in Net Sales for the Quarter Ended December 28, 2018 versus Net Sales for the Quarter Ended December 29, 2017
	Net Sales Growth					Organic Net Sales Growth					Translation
	($ in millions)
Automotive	$	(48	)	(3.2	)%	$	(9	)	(0.6	)%	$	(39	)
Commercial transportation		(3	)	(1.0	)		5		1.7			(8	)
Sensors		5		2.3			8		3.8			(3	)
Total	$	(46	)	(2.3	)%	$	4		0.2	%	$	(50	)

        Net sales in the Transportation Solutions segment decreased $46 million, or 2.3%, in the first quarter of fiscal 2019 from the first quarter of fiscal 2018 due primarily to the negative impact of foreign currency translation of 2.5%. Our organic net sales by primary industry end market were as follows:

•

Automotive—Our organic net sales decreased 0.6% in the first quarter of fiscal 2019 with declines of 3.5% and 2.7% in the Asia–Pacific and EMEA regions, respectively, partially offset by growth of 11.9% in the Americas region. Our declines in the Asia–Pacific and EMEA regions were driven by market weakness. In the Americas region, our growth resulted from electronification and market share gains in North America.

•

Commercial transportation—Our organic net sales increased 1.7% in the first quarter of fiscal 2019 due to content gains as well as growth in the Americas and EMEA regions, partially offset by weakness in the heavy truck market in China.

•

Sensors—Our organic net sales increased 3.8% in the first quarter of fiscal 2019 due primarily to growth in the industrial equipment market.

33

        Operating Income.    The following table presents the Transportation Solutions segment's operating income and operating margin information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Operating income	$	332		$	417		$	(85	)
Operating margin		16.7	%		20.5	%

        In the first quarter of fiscal 2019, operating income in the Transportation Solutions segment decreased $85 million as compared to the first quarter of fiscal 2018. The Transportation Solutions segment's operating income included the following:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Acquisition related charges:
Acquisition and integration costs	$	3	$	1
Charges associated with the amortization of acquisition related fair value adjustments		—		4
		3		5
Restructuring and other charges, net		21		4
Total	$	24	$	9

Excluding these items, operating income decreased in the first quarter of fiscal 2019 due primarily to lower manufacturing productivity, price erosion, and the negative impact of foreign currency translation.

Industrial Solutions

        Net Sales.    The following table presents the Industrial Solutions segment's net sales and the percentage of total net sales by primary industry end market⁽¹⁾:

	For the Quarters Ended
	December 28, 2018				December 29, 2017
	($ in millions)
Industrial equipment	$	483	52	%	$	471	53	%
Aerospace, defense, oil, and gas		285	31			254	29
Energy		160	17			157	18
Total	$	928	100	%	$	882	100	%

(1)

Industry end market information is presented consistently with our internal management reporting and may be revised periodically as management deems necessary.

34

        The following table provides an analysis of the change in the Industrial Solutions segment's net sales by primary industry end market:

	Change in Net Sales for the Quarter Ended December 28, 2018 versus Net Sales for the Quarter Ended December 29, 2017
	Net Sales Growth				Organic Net Sales Growth					Translation			Acquisition
	($ in millions)
Industrial equipment	$	12	2.5	%	$	(2	)	(0.5	)%	$	(7	)	$	21
Aerospace, defense, oil, and gas		31	12.2			33		12.7			(2	)		—
Energy		3	1.9			9		5.8			(6	)		—
Total	$	46	5.2	%	$	40		4.5	%	$	(15	)	$	21

        In the first quarter of fiscal 2019, net sales in the Industrial Solutions segment increased $46 million, or 5.2%, from the first quarter of fiscal 2018 as a result of organic net sales growth of 4.5% and sales contributions from an acquisition of 2.4%, partially offset by the negative impact of foreign currency translation of 1.7%. Our organic net sales by primary industry end market were as follows:

•

Industrial equipment—Our organic net sales decreased 0.5% in the first quarter of fiscal 2019 due primarily to market weakness in factory automation and controls, partially offset by strength in medical applications.

•

Aerospace, defense, oil, and gas—Our organic net sales increased 12.7% in the first quarter of fiscal 2019 as a result of strength in the commercial aerospace, defense, and oil and gas markets.

•

Energy—Our organic net sales increased 5.8% in the first quarter of fiscal 2019 due primarily to strength in the Americas region.

        Operating Income.    The following table presents the Industrial Solutions segment's operating income and operating margin information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Operating income	$	100		$	102		$	(2	)
Operating margin		10.8	%		11.6	%

35

        Operating income in the Industrial Solutions segment decreased $2 million in the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018. The Industrial Solutions segment's operating income included the following:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Acquisition related charges:
Acquisition and integration costs	$	2	$	1
Charges associated with the amortization of acquisition related fair value adjustments		1		1
		3		2
Restructuring and other charges, net		35		22
Total	$	38	$	24

Excluding these items, operating income increased in the first quarter of fiscal 2019 primarily as a result of higher volume.

Communications Solutions

        Net Sales.    The following table presents the Communications Solutions segment's net sales and the percentage of total net sales by primary industry end market⁽¹⁾:

	For the Quarters Ended
	December 28, 2018				December 29, 2017
	($ in millions)
Data and devices	$	257	59	%	$	238	56	%
Appliances		176	41			184	44
Total	$	433	100	%	$	422	100	%

(1)

Industry end market information is presented consistently with our internal management reporting and may be revised periodically as management deems necessary.

        The following table provides an analysis of the change in the Communications Solutions segment's net sales by primary industry end market:

	Change in Net Sales for the Quarter Ended December 28, 2018 versus Net Sales for the Quarter Ended December 29, 2017
	Net Sales Growth					Organic Net Sales Growth					Translation
	($ in millions)
Data and devices	$	19		8.0	%	$	22		9.3	%	$	(3	)
Appliances		(8	)	(4.3	)		(3	)	(1.7	)		(5	)
Total	$	11		2.6	%	$	19		4.6	%	$	(8	)

        Net sales in the Communications Solutions segment increased $11 million, or 2.6%, in the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018 due to organic net sales growth of

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4.6%, partially offset by the negative impact of foreign currency translation of 2.0%. Our organic net sales by primary industry end market were as follows:

•

Data and devices—Our organic net sales increased 9.3% in the first quarter of fiscal 2019 with growth in all regions, primarily attributable to growth in high speed connectivity in data center applications.

•

Appliances—Our organic net sales decreased 1.7% in the first quarter of fiscal 2019 due primarily to market weakness in the Asia–Pacific region, partially offset by growth in North America.

        Operating Income.    The following table presents the Communications Solutions segment's operating income and operating margin information:

	For the Quarters Ended
	December 28, 2018			December 29, 2017			Change
	($ in millions)
Operating income	$	52		$	67		$	(15	)
Operating margin		12.0	%		15.9	%

        Operating income in the Communications Solutions segment decreased $15 million in the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018. The Communications Solutions segment's operating income included the following:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Restructuring and other charges, net	$	19	$	8

Excluding these items, operating income decreased slightly in the first quarter of fiscal 2019 as compared to the first quarter of fiscal 2018.

Liquidity and Capital Resources

        Our ability to fund our future capital needs will be affected by our ability to continue to generate cash from operations and may be affected by our ability to access the capital markets, money markets, or other sources of funding, as well as the capacity and terms of our financing arrangements. We believe that cash generated from operations and, to the extent necessary, these other sources of potential funding will be sufficient to meet our anticipated capital needs for the foreseeable future, including the payment of $250 million of 2.35% senior notes due in 2019. We may use excess cash to purchase a portion of our common shares pursuant to our authorized share repurchase program, to acquire strategic businesses or product lines, to pay dividends on our common shares, or to reduce our outstanding debt. The cost or availability of future funding may be impacted by financial market conditions. We will continue to monitor financial markets and respond as necessary to changing conditions.

Cash Flows from Operating Activities

        In the first quarter of fiscal 2019, net cash provided by continuing operating activities increased $45 million to $328 million from $283 million in the first quarter of fiscal 2018. The increase resulted primarily from higher collections of accounts receivable, partially offset by a decrease in pre-tax income levels.

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        The amount of income taxes paid, net of refunds, during the first quarters of fiscal 2019 and 2018 was $75 million and $82 million, respectively.

Cash Flows from Investing Activities

        Capital expenditures were $210 million and $237 million in the first quarters of fiscal 2019 and 2018, respectively. We expect fiscal 2019 capital spending levels to be approximately 5-6% of net sales. We believe our capital funding levels are adequate to support new programs, and we continue to invest in our manufacturing infrastructure to further enhance productivity and manufacturing capabilities.

        During the first quarter of fiscal 2019, we received net cash proceeds of $288 million related to the sale of our SubCom business. See additional information in Note 3 to the Condensed Consolidated Financial Statements.

Cash Flows from Financing Activities and Capitalization

        Total debt at December 28, 2018 and September 28, 2018 was $3,967 million and $4,000 million, respectively. See Note 7 to the Condensed Consolidated Financial Statements for additional information regarding debt.

        During November 2018, Tyco Electronics Group S.A. ("TEGSA"), our 100%-owned subsidiary, issued $350 million aggregate principal amount of senior floating rate notes due June 2020. The notes bear interest at a rate of three-month London Interbank Offered Rate ("LIBOR") plus 0.45% per year. The notes are TEGSA's unsecured senior obligations and rank equally in right of payment with all existing and any future senior indebtedness of TEGSA and senior to any subordinated indebtedness that TEGSA may incur.

        During December 2018, TEGSA repaid, at maturity, $325 million 2.375% senior notes due 2018.

        TEGSA has a five-year unsecured senior revolving credit facility ("Credit Facility") with total commitments of $1,500 million. The Credit Facility was amended in November 2018 primarily to extend the maturity date from December 2020 to November 2023. The amended Credit Facility contains provisions that allow for incremental commitments of up to $500 million, an option to temporarily increase the financial ratio covenant following a qualified acquisition, and borrowings in designated currencies. TEGSA had no borrowings under the Credit Facility at December 28, 2018 or September 28, 2018.

        The Credit Facility contains a financial ratio covenant providing that if, as of the last day of each fiscal quarter, our ratio of Consolidated Total Debt to Consolidated EBITDA (as defined in the Credit Facility) for the then most recently concluded period of four consecutive fiscal quarters exceeds 3.75 to 1.0, an Event of Default (as defined in the Credit Facility) is triggered. The Credit Facility and our other debt agreements contain other customary covenants. None of our covenants are presently considered restrictive to our operations. As of December 28, 2018, we were in compliance with all of our debt covenants and believe that we will continue to be in compliance with our existing covenants for the foreseeable future.

        In addition to the Credit Facility, TEGSA is the borrower under our senior notes and commercial paper. TEGSA's payment obligations under its senior notes, commercial paper, and Credit Facility are fully and unconditionally guaranteed by its parent, TE Connectivity Ltd.

        Payments of common share dividends to shareholders were $150 million and $141 million in the first quarters of fiscal 2019 and 2018, respectively.

        During the first quarter of fiscal 2019, our board of directors authorized an increase of $1.5 billion in the share repurchase program. We repurchased approximately 6 million of our common shares for $495 million and approximately 2 million of our common shares for $214 million under our share

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repurchase program during the first quarters of fiscal 2019 and 2018, respectively. At December 28, 2018, we had $2.0 billion of availability remaining under our share repurchase authorization.

Commitments and Contingencies

Legal Proceedings

        In the normal course of business, we are subject to various legal proceedings and claims, including patent infringement claims, product liability matters, employment disputes, disputes on agreements, other commercial disputes, environmental matters, antitrust claims, and tax matters, including non-income tax matters such as value added tax, sales and use tax, real estate tax, and transfer tax. Although it is not feasible to predict the outcome of these proceedings, based upon our experience, current information, and applicable law, we do not expect that the outcome of these proceedings, either individually or in the aggregate, will have a material effect on our results of operations, financial position, or cash flows.

Guarantees

        In certain instances, we have guaranteed the performance of third parties and provided financial guarantees for uncompleted work and financial commitments. The terms of these guarantees vary with end dates ranging from fiscal 2019 through the completion of such transactions. The guarantees would be triggered in the event of nonperformance, and the potential exposure for nonperformance under the guarantees would not have a material effect on our results of operations, financial position, or cash flows.

        In disposing of assets or businesses, we often provide representations, warranties, and/or indemnities to cover various risks including unknown damage to assets, environmental risks involved in the sale of real estate, liability for investigation and remediation of environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not expect that these uncertainties will have a material adverse effect on our results of operations, financial position, or cash flows.

        At December 28, 2018, we had outstanding letters of credit, letters of guarantee, and surety bonds of $286 million.

        As discussed above, in the first quarter of fiscal 2019, we sold our SubCom business. In connection with the sale, we contractually agreed to continue to honor performance guarantees and letters of credit related to the SubCom business' projects that existed as of the date of sale. These guarantees have a combined value of approximately $1.7 billion and are expected to expire at various dates through fiscal 2025; however, the majority are expected to expire within two years. Also, under the terms of the definitive agreement, we are required to issue up to $300 million of new performance guarantees, subject to certain limitations, for projects entered into by the SubCom business following the sale for a period of up to three years. During the quarter ended December 28, 2018, we issued a guarantee of $70 million for a new project. We have contractual recourse against the SubCom business if we are required to perform on any SubCom guarantees; however, based on historical experience, we do not anticipate having to perform. See Note 3 to the Condensed Consolidated Financial Statements for additional information regarding the divestiture of the SubCom business.

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Critical Accounting Policies and Estimates

        The preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenue and expenses.

        Our accounting policies for revenue recognition, goodwill and other intangible assets, income taxes, and pension liabilities are based on, among other things, judgments and assumptions made by management. For additional information regarding these policies and the underlying accounting assumptions and estimates used in these policies, refer to the Consolidated Financial Statements and accompanying notes contained in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018. Except as set forth below, there were no significant changes to this information during the first quarter of fiscal 2019.

Revenue Recognition

        We adopted ASC 606, Revenue from Contracts with Customers, in the first quarter of fiscal 2019. See Note 1 to the Condensed Consolidated Financial Statements for additional information regarding our revenue recognition policy and the adoption of ASC 606.

Accounting Pronouncements

        See Note 1 to the Condensed Consolidated Financial Statements for information regarding recently adopted accounting pronouncements.

Non-GAAP Financial Measure

Organic Net Sales Growth

        We present organic net sales growth as we believe it is appropriate for investors to consider this adjusted financial measure in addition to results in accordance with GAAP. Organic net sales growth represents net sales growth (the most comparable GAAP financial measure) excluding the impact of foreign currency exchange rates, and acquisitions and divestitures that occurred in the preceding twelve months, if any. Organic net sales growth is a useful measure of our performance because it excludes items that are not completely under management's control, such as the impact of changes in foreign currency exchange rates, and items that do not reflect the underlying growth of the company, such as acquisition and divestiture activity.

        Organic net sales growth provides useful information about our results and the trends of our business. Management uses organic net sales growth to monitor and evaluate performance. Also, management uses organic net sales growth together with GAAP financial measures in its decision-making processes related to the operations of our reportable segments and our overall company. It is also a significant component in our incentive compensation plans. We believe that investors benefit from having access to the same financial measures that management uses in evaluating operations. The tables presented in "Results of Operations" and "Segment Results" provide reconciliations of organic net sales growth to net sales growth calculated in accordance with GAAP.

        Organic net sales growth is a non-GAAP financial measure and should not be considered a replacement for results in accordance with GAAP. This non-GAAP financial measure may not be comparable to similarly-titled measures reported by other companies. The primary limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using organic net sales growth in combination with net sales growth in order to better understand the amounts, character, and impact of any increase or decrease in reported amounts.

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Forward-Looking Information

        Certain statements in this Quarterly Report on Form 10-Q are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on our management's beliefs and assumptions and on information currently available to our management. Forward-looking statements include, among others, the information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, potential growth opportunities, potential operating performance improvements, acquisitions, divestitures, the effects of competition, and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believe," "expect," "plan," "intend," "anticipate," "estimate," "predict," "potential," "continue," "may," "should," or the negative of these terms or similar expressions.

        Forward-looking statements involve risks, uncertainties, and assumptions. Actual results may differ materially from those expressed in these forward-looking statements. Investors should not place undue reliance on any forward-looking statements. We do not have any intention or obligation to update forward-looking statements after we file this report except as required by law.

        The following and other risks, which are described in greater detail in "Part I. Item 1A. Risk Factors," in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018, could cause our results to differ materially from those expressed in forward-looking statements:

•

conditions in the global or regional economies and global capital markets, and cyclical industry conditions;

•

conditions affecting demand for products in the industries we serve, particularly the automotive industry;

•

competition and pricing pressure;

•

market acceptance of our new product introductions and product innovations and product life cycles;

•

raw material availability, quality, and cost;

•

fluctuations in foreign currency exchange rates and impacts of offsetting hedges;

•

financial condition and consolidation of customers and vendors;

•

reliance on third-party suppliers;

•

risks associated with current and future acquisitions and divestitures;

•

global risks of business interruptions such as natural disasters and political, economic, and military instability;

•

risks associated with security breaches and other disruptions to our information technology infrastructure;

•

risks related to compliance with current and future environmental and other laws and regulations;

•

our ability to protect our intellectual property rights;

•

risks of litigation;

•

our ability to operate within the limitations imposed by our debt instruments;

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•

the possible effects on us of various non-U.S. and U.S. legislative proposals and other initiatives that, if adopted, could materially increase our worldwide corporate effective tax rate and negatively impact our U.S. government contracts business;

•

various risks associated with being a Swiss corporation;

•

the impact of fluctuations in the market price of our shares; and

•

the impact of certain provisions of our articles of association on unsolicited takeover proposals.

There may be other risks and uncertainties that we are unable to predict at this time or that we currently do not expect to have a material adverse effect on our business.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        In the first quarter of fiscal 2019, we expanded our cross-currency swap program to hedge our net investment in certain foreign operations. The aggregate notional value of this program was $952 million at December 28, 2018. See Note 9 to the Condensed Consolidated Financial Statements for further information regarding our exposures to market risk.

        There have been no significant changes in our exposures to market risk during the first quarter of fiscal 2019, except for the item noted above. For further discussion of our exposures to market risk, refer to "Part II. Item 7A. Quantitative and Qualitative Disclosures About Market Risk" in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018.

ITEM 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

        Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934), as of December 28, 2018. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 28, 2018.

Changes in Internal Control Over Financial Reporting

        During the quarter ended December 28, 2018, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

        There have been no material developments in our legal proceedings since we filed our Annual Report on Form 10-K for the fiscal year ended September 28, 2018, except as set forth below. Refer to "Part I. Item 3. Legal Proceedings" in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018 for additional information regarding legal proceedings.

        During the fourth quarter of fiscal 2018, one of our manufacturing sites in China was found to have failed to complete the environmental impact assessment inspection for certain of its production lines and assets within the mandatory timeframe as defined within applicable environmental regulation. At the request of the Shanghai Xuhui Environmental Protection Bureau, we are taking remedial actions to cure the deficiencies, and we paid an administrative penalty in the amount of 700,000 Chinese renminbi (approximately $0.1 million using an exchange rate of $0.15 per renminbi). We do not anticipate that any monetary sanctions or remedial actions we take will have a material adverse effect on our results of operations, financial position, or cash flows.

ITEM 1A.    RISK FACTORS

        There have been no material changes in our risk factors from those disclosed in "Part I. Item 1A. Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018. The risk factors described in our Annual Report on Form 10-K, in addition to other information in this report, could materially affect our business operations, financial condition, or liquidity. Additional risks and uncertainties not currently known to us or that we currently believe are immaterial may also impair our business operations, financial condition, and liquidity.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

        The following table presents information about our purchases of our common shares during the quarter ended December 28, 2018:

Period	Total Number of Shares Purchased(1)		Average Price Paid Per Share(1)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)		Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(2)
September 29–October 26, 2018		814,408	$	80.63		813,900	$	949,322,872
October 27–November 30, 2018		4,093,846		77.52		3,950,000		643,196,637
December 1–December 28, 2018		1,859,712		73.70		1,670,000		2,020,396,779
Total		6,767,966	$	76.85		6,433,900

(1)

These columns include the following transactions which occurred during the quarter ended December 28, 2018:

(i)

the acquisition of 334,066 common shares from individuals in order to satisfy tax withholding requirements in connection with the vesting of restricted share awards issued under equity compensation plans; and

(ii)

open market purchases totaling 6,433,900 common shares, summarized on a trade-date basis, in conjunction with the share repurchase program announced in September 2007.

(2)

During the quarter ended December 28, 2018, our board of directors authorized an increase of $1.5 billion in the share repurchase program. Our share repurchase program authorizes us to purchase a portion of our outstanding common shares from time to time through open market or private transactions, depending on business and market conditions. The share repurchase program does not have an expiration date.

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ITEM 6.    EXHIBITS

Exhibit Number		Exhibit
4.1		Fifteenth Supplemental Indenture, dated as of December 5, 2018, among Tyco Electronics Group S.A., as issuer, TE Connectivity Ltd., as guarantor, and Deutsche Bank Trust Company Americas, as trustee (incorporated by reference to Exhibit 4.1 to TE Connectivity's Current Report on Form 8-K, filed December 6, 2018)
10.1		Amended and Restated Five-Year Senior Credit Agreement dated as of November 14, 2018 among Tyco Electronics Group S.A., as borrower, TE Connectivity Ltd., as guarantor, the lenders party thereto and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to TE Connectivity's Current Report on Form 8-K, filed November 14, 2018)
10.2	‡*	Employment Agreement between Kevin N. Rock and TE Connectivity Corporation dated December 15, 2015
31.1	*	Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	*	Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	**	Certification by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	*	Financial statements from the Quarterly Report on Form 10-Q of TE Connectivity Ltd. for the quarterly period ended December 28, 2018, filed on January 24, 2019, formatted in XBRL: (i) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Shareholders' Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Condensed Consolidated Financial Statements

‡

Management contract or compensatory plan or arrangement

*

Filed herewith

**

Furnished herewith

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

TE CONNECTIVITY LTD.
By:	/s/ HEATH A. MITTS Heath A. Mitts Executive Vice President and Chief Financial Officer (Principal Financial Officer)

Date: January 24, 2019

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EX-10.2

Exhibit 10.2

EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT, dated as of December 15, 2015, by and between Tyco Electronics Corporation, a Pennsylvania corporation (the “Company”), and Kevin N. Rock (the “Executive”).

W I T N E S S E T H :

WHEREAS, the Executive currently serves as President, Industrial Solutions of the Company; and

WHEREAS, the Executive and the Company mutually desire to provide for the continued services and employment of the Executive by the Company under the terms and conditions hereinafter set forth in this agreement (the “2015 Agreement”).

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein and for good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto, each intending to be legally bound hereby, agree as follows:

1.Employment.  On the terms and subject to the conditions set forth herein, the Company hereby agrees to continue the employment of the Executive, and the Executive hereby agrees to continue his employment with the Company, for the Employment Term (as defined below).  During the Employment Term, the Executive shall serve as the President, Industrial Solutions of the Company and shall report to the President, TE Connectivity or such person or persons as from time to time may be designated by the Company (the “Reporting Officer”), performing such duties and responsibilities as are customarily attendant to such position with respect to the business of the Company and such other duties and responsibilities as may from time to time be assigned to the Executive by the Reporting Officer consistent with such position.  Upon notice from the Company, the Executive’s title, Reporting Officer and duties and responsibilities may be changed as is deemed necessary and appropriate by the Company.

2.Performance.  The Executive shall serve the Company and its subsidiaries and affiliates faithfully and to the best of Executive’s ability and shall devote full business time, energy, experience and talents to the business of the Company and its subsidiaries and affiliates, as applicable, and will not engage in any other employment activities for any direct or indirect remuneration without the written approval of the Board; provided, however, that it shall not be a violation of this Agreement for the Executive to (i) continue to serve as a non-employee director of the business entities set forth on Exhibit A attached hereto on which Executive currently serves, if any, or (ii) manage personal investments or to engage in or serve such civic, community, charitable, educational, or religious organizations as Executive may select, so long as such service described in clauses (i) and (ii) of this sentence does not create a conflict of interest with, or interfere with the performance of, the Executive’s duties hereunder or conflict with the Executive’s covenants under Section 6 of this Agreement, or result in a violation of any applicable laws, regulations or articles of association (including the articles of association of TE Connectivity Ltd.), in each case as determined in the sole judgment of the Board.

3.Employment Term.  This Agreement shall be effective commencing on the date hereof (the “Commencement Date”) until terminated by either party providing appropriate notice to the other party (such period, the “Employment Term”).  The Executive’s employment with the Company shall be on an “at-will” basis, which means that the Executive’s employment is terminable by either the Company or the Executive at any time for any reason or no reason, with or without cause or notice (other than any notice required under Section 7 hereof).

4.Principal Location. The Executive’s principal place of employment shall be the Company’s offices located in Harrisburg, Pennsylvania or such other location as is mutually agreed between the parties, subject to required travel.

5.Compensation and Benefits.

(a)Base Salary.  As compensation for the Executive’s services hereunder and in consideration of the Executive’s other agreements hereunder, during the Employment Term, the Company shall pay the Executive a base salary, payable in equal installments in accordance with Company payroll procedures, in an amount equal to Executive’s current base salary, subject to annual review by the Management Development and Compensation Committee (the “MDCC”) of the Company’s Board of Directors.

(b)Annual Cash Bonus.  During the Employment Term, the Executive shall be entitled to participate in the Company’s Annual Incentive Plan or Annual Performance Bonus Plan, as applicable (the “Bonus Plan”), with a bonus target equal to Executive’s current bonus target, subject to annual review by the MDCC.

(c)Annual Equity Incentive Awards.  During the Employment Term, the Executive shall be entitled to participate in the Company’s 2007 Stock and  Incentive Plan (the “SIP”), or such other equity incentive plan as is deemed appropriate by the MDCC, and to receive annual long-term equity incentive awards in a form and amount determined by the MDCC.  The Company’s award cycle under the SIP currently takes place in the November timeframe each year.

(d)Benefits.  During the Employment Term, the Executive shall, subject to and in accordance with the terms and conditions of the applicable plan documents and all applicable laws, be entitled to participate in all of the employee benefit, fringe and perquisite plans, practices, policies and arrangements that the Company makes available from time to time to its employees generally, under terms consistent with other similarly-situated executives.  Such employee benefit plans and programs currently include, but are not limited to, the Tyco Electronics Retirement Savings and Investment Plan, the Tyco Electronics Supplemental Savings and Retirement Plan, the TE Connectivity Health and Welfare Plan (including medical, dental, vision, flexible spending accounts for healthcare and dependent care, life insurance, accidental death and dismemberment insurance, long-term disability and short term disability), Business Travel Medical Insurance, Business Travel Accident Insurance, and the TE Employee Stock Purchase Plan.  The Company may amend or terminate the employee benefit plans and programs at any time.

(e)Severance Benefits.  During the Employment Term, the Executive shall not be entitled to participate in the Company’s Severance Plan for U.S. Officers and Executives or any other severance pay plan, program, or policy of the Company or its subsidiaries.

2

(f)Change in Control Severance Plan.   During the Employment Term, the Executive shall not be entitled to participate in the Company’s Change in Control Severance Plan for Certain U.S. Officers and Executives or any other change of control plan, program, or policy of the Company or its subsidiaries.

(g)Vacation and Paid Time Off.  The Executive shall be entitled to vacation and paid time off in accordance with the standard policies of the Company for executives as in effect from time to time.

(h)Business Expenses.  The Executive shall be reimbursed by the Company for all reasonable and necessary business expenses actually incurred by the Executive in performing his duties hereunder.  All payments under this paragraph (h) of this Section 5 will be made in accordance with policies established by the Company from time to time and subject to receipt by the Company of appropriate documentation.

(i)Required Stock Ownership.  The Executive acknowledges and agrees to adhere to the Company’s executive stock ownership guidelines as set forth in the Company’s Stock Ownership Policy, as may be amended from time to time in the Company’s sole discretion, which currently requires, among other things, that the Executive shall acquire and hold three times his annual base salary in Company stock.

6.Covenants of the Executive.  The Executive is party to a “TE Connectivity Confidentiality and Invention Assignment Agreement” (executed upon Executive’s employment with the Company) and a “Limited Non-Competition Agreement” (executed upon Executive’s initial acceptance of the terms and conditions of the Annual Incentive Plan).  Executive acknowledges that the terms and conditions of those agreements remain in full force and effect as described in the agreements.

7.Termination.

(a)Termination of Employment.  The employment of the Executive hereunder and the Employment Term may be terminated at any time (i) by the Company without Cause (as defined herein) on twelve months written notice to the Executive, (ii) by the Company with Cause or due to the Executive’s Disability (as defined herein) on written notice to the Executive, (iii) by the Executive for any reason upon thirty (30) days written notice (which notice period may be waived by the Company in its discretion, in which case, such termination shall be effective on any date prior to the end of such thirty (30) day period as selected by the Company), (iv) by the Executive with Good Reason following a Change in Control (as defined in the Company’s Change in Control Severance Plan for Certain U.S. Officers and Executives (“CIC Plan”)) on twelve months written notice to the Company, provided that such termination occurs during the period beginning 60 days prior to the date of a Change in Control and ending two years after the date of such Change in Control, or (v) without action by the Company, the Executive or any other person or entity, immediately upon the Executive’s death.  If the Executive’s employment is terminated for any reason under this Section 7(a), the Company shall be obligated to pay or provide to the Executive (or his estate, as applicable):  (A) any base salary payable to the Executive pursuant to this Agreement, accrued up to and including the date on which the Executive’s employment terminates, (B) any employee benefits to which the Executive is entitled upon termination of his employment with the Company in accordance with the terms and conditions of the applicable plans of the Company, (C) reimbursement for any unreimbursed business expenses incurred by the

3

Executive prior to his date of termination pursuant to Section 5(f), and (D) payment for accrued but unused vacation and/or paid time off as of the date of his termination, in accordance with Company policy ((A)-(D) collectively, the “Accrued Amounts”).

Compensation and Benefits during the Notice Period.  Except as otherwise provided in this Section 7, Executive shall continue to be paid his base salary and continue to participate in the Company’s incentive compensation and benefit plans (in accordance with the applicable plan terms), as more fully described in Section 5, except that Executive will not be granted any additional long-term equity incentive awards) during the applicable notice period, if any, as described in Section 7 above (such notice period or any part thereof referred to herein as the “Notice Period”), through the Executive’s termination date.  For avoidance of doubt, during the Notice Period, Executive will continue to participate in the Annual Incentive Plan or Annual Performance Bonus Plan, as applicable, at the same bonus target award level in effect prior to the Notice Period and under the applicable Plan terms and conditions through Executive’s date of termination.

Duties and Responsibilities during Notice Period.  At any time after the Executive or the Company has given notice to the other party to terminate the Executive’s employment in accordance with the terms of this Section 7(a), provided that the Company continues to pay the Executive’s salary and to provide all benefits (or pay a sum in lieu of the value of one or more such benefits) to which the Executive is contractually entitled until the termination of the Executive’s employment, the Company shall be entitled in its discretion, during the Notice Period: (i) to require the Executive not to enter or attend his place of work or any other premises of the Company or any affiliates thereof; (ii) to require the Executive not to carry out his duties or responsibilities under this Agreement; (iii) to require the Executive to return to the Company all property belonging to the Company or any affiliates thereof or to its/their clients or customers (including summaries, extracts or copies); (iv) to require the Executive to undertake work from his home and/or to carry out exceptional duties or special projects outside the normal scope of his duties and responsibilities for the Company or any affiliates thereof; (v) to appoint one or more persons to undertake the Executive’s duties and/or responsibilities and/or assume his position; (vi) to instruct the Executive not to communicate with clients, customers, suppliers, investors, employees, directors, consultants, agents or representatives of the Company or any affiliates thereof;  (vii) to require the Executive to keep the Company informed of his whereabouts so that the Executive can be contacted should the need arise for the Executive to perform any duties or responsibilities under this Agreement or exceptional duties or special projects outside of the normal scope of his duties; and/or (viii) to remove Executive as a Section 16 officer or member of executive management for purposes of Swiss law.

Paid Time Off.  Any paid time off which has accrued to the Executive at the start of his Notice Period and any paid time off entitlement which continues to accrue during his Notice Period shall be deemed to be taken by the Executive during the Notice Period.

Employment Status during Notice Period/Prohibition against Work for a Third Party.  For the avoidance of doubt, during any Notice Period, the Executive shall remain an employee of the Company and continue to receive his normal rate of pay and all contractual benefits in accordance with this Agreement and be bound by all his express and implied duties

4

save as varied in accordance with the provisions of this Section 7(a).  During the Notice Period, the Executive shall not undertake any work for any third party (as an employee or otherwise) whether paid or unpaid without written permission from the Company.  If the Company grants such permission, the Company’s obligation to continue to treat the Executive as an employee of the Company and to continue to provide the normal rate of pay and all contractual benefits as an employee of the Company for the remainder of the Notice Period shall immediately cease, and the Company shall have the right to terminate the Notice Period as it deems appropriate in its discretion in light of the circumstances of third party work at issue.  This paragraph shall not apply to any unpaid volunteer work performed by Executive for a civic, community, charitable, educational, or religious organization, provided that such work does not interfere with Executive’s ability to make himself available for full-time work with the Company as deemed necessary by the Company in its discretion during the Notice Period.  In addition, Executive may accept a compensated role as a member of a board of directors of a for-profit entity, provided that the Executive provides written notice to the Company of the role and the Company consents to executive’s acceptance of the role.  Such consent will not be unreasonably withheld as long as the Company determines, in its sole discretion, that the role will not interfere with Executive’s ability to make himself available for full-time work with the Company during the Notice Period.

(b)Payment in Consideration of Release and Restrictive Covenants.   If the Executive’s employment is terminated for the reasons described in Sections 7(a)(i) or 7(a)(ii), the Company shall provide the Executive with cash consideration in exchange for the Executive’s execution, and compliance with the terms, of the restrictive covenants and release of claims set forth in the separation agreement described in Section 7(c).  The amount of such cash consideration shall be equal to the sum of the Executive’s annual base salary (as described in Section 5(a)) and the current target annual bonus (as described in Section 5(b)), in each case, as in effect immediately prior to the date of the Executive’s termination of employment, and subject to a maximum aggregate amount not exceeding the total amount of compensation (including base salary, Bonus Plan awards and the value of annual equity incentive awards granted) of the Executive during the last full fiscal year when the Executive was employed.  Such consideration shall be payable in equal installments over a twelve month period following the date of such termination in accordance with the Company’s payroll practices, subject to reduction for any applicable tax withholding and/or pursuant to any terms of the separation agreement described in Section 7(c).

(c)Separation Agreement and Release of Claims.  As a condition of receiving any consideration for which the Executive otherwise qualifies under Section 7(b), the Executive agrees (i) to execute, deliver and not revoke, within thirty (30) days following the date of the Executive’s termination of employment, a separation agreement containing restrictive covenants running in favor of the Company and its affiliates, and a general release of the Company and its subsidiaries and their respective affiliates and their respective employees, officers, directors, owners and members from any and all claims, obligations and liabilities of any kind whatsoever, including, without limitation, those arising from or in connection with the Executive’s employment or termination of employment with the Company or any of its subsidiaries or affiliates or this Agreement (including, without limitation, civil rights claims), in such form as is requested by the Company, such separation agreement and general release to be delivered, and to have become fully irrevocable, on or before the end of such thirty (30)-day period, and (ii) not to apply for unemployment compensation chargeable to the Company during the period with respect to which the Executive is receiving such consideration.  If such a general release described in clause (i) of

5

the immediately preceding sentence has not been executed and delivered and become irrevocable on or before the end of such thirty (30)-day period, no amounts or benefits under Section 7(b) shall be or become payable. To the extent that any payments or benefits to the Executive under Section 7(b) are subject to Section 409A of the Code and the Executive’s employment is terminated within 60 days of the end of a calendar year, payments of such amounts shall not be made until the calendar year following the year in which the Executive’s employment is terminated (but with the first payment being a lump sum payment covering all payment periods from the date of termination through the date of such first payment).

(d)No Additional Rights.  The Executive acknowledges and agrees that, except as specifically described in this Section 7, all of the Executive’s rights to any compensation, benefits, bonuses or other payments from the Company and its subsidiaries and affiliates after termination of the Employment Term shall cease upon such termination.

(e)Offset.  To the extent permitted by Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), any consideration to which the Executive is otherwise entitled pursuant to this Section 7 shall be (i) reduced by amounts outstanding under any indebtedness, obligations or liabilities owed by the Executive to the Company; (ii) reduced and offset by any severance pay or benefits, or similar amounts, payable to the Executive due to his termination of employment under any labor, social or other governmental plan, program, law or policy, and should such other payments or benefits described in this clause be payable, payments under this Agreement shall be reduced accordingly or, alternatively, payments previously paid or provided under this Agreement will be treated as having been paid or provided to satisfy such other obligations.

(f)Resignation as Officer or Director.  Upon a termination of employment, unless requested otherwise by the Company, the Executive shall resign each position (if any) that the Executive then holds as a director or officer of the Company or of any affiliates of the Company.  The Executive’s execution of this Agreement shall be deemed the grant by the Executive to the officers of the Company of a limited power of attorney to sign in the Executive’s name and on the Executive’s behalf any such documentation as may be required to be executed solely for the limited purposes of effectuating such resignations.

(g)Definitions of Certain Terms.  For purposes of this Agreement:

(i)“Cause” shall have the meaning given that term in the Company’s Severance Plan for U.S. Officers and Executives, as such plan may be amended from time to time.

(ii)“Disability” shall mean a “Permanent Disability” as that term is defined in the Company’s Severance Plan for U.S. Officers and Executives, as such plan may be amended from time to time.

(iii)“Good Reason” shall have the meaning given that term in the CIC Plan, as such plan may be amended from time to time and will only apply after the occurrence of a “Change in Control”, as defined in the CIC Plan.

6

(h)Equity Awards.   The treatment of Executive’s outstanding equity awards will be governed by the applicable equity award agreements and other governing award and plan documents.

8.Notices.  All notices, requests, demands, claims, consents and other communications which are required, permitted or otherwise delivered hereunder shall in every case be in writing and shall be deemed properly served if:  (a) delivered personally, (b) sent by registered or certified mail, in all such cases with first class postage prepaid, return receipt requested, or (c) delivered by a recognized overnight courier service, to the parties at the addresses as set forth below:

If to the Company:Tyco Electronics Corporation

1050 Westlakes Drive

Berwyn, Pennsylvania 19312

Attention:  Senior Vice President, Global Human Resources

If to the Executive:At the Executive’s residence address as maintained by the Company in the regular course of its business for payroll purposes.

or to such other address as shall be furnished in writing by either party to the other party; provided that such notice or change in address shall be effective only when actually received by the other party.  Date of service of any such notices or other communications shall be:  (a) the date such notice is personally delivered, (b) three days after the date of mailing if sent by certified or registered mail, or (c) one business day after date of delivery to the overnight courier if sent by overnight courier.

9.Section 409A.

(a)The intent of the parties is that payments and benefits under this Agreement comply with or be exempt from Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively “Code Section 409A”), and the Company shall have complete discretion to interpret and construe this Agreement and any associated documents in any manner that establishes an exemption from (or compliance with) the requirements of Code Section 409A.  If for any reason, such as imprecision in drafting, any provision of this Agreement (or of any award of compensation, including, without limitation, equity compensation or benefits) does not accurately reflect its intended establishment of an exemption from (or compliance with) Code Section 409A, as demonstrated by consistent interpretations or other evidence of intent, such provision shall be considered ambiguous as to its exemption from (or compliance with) Code Section 409A and shall be interpreted by the Company in a manner consistent with such intent, as determined in the discretion of the Company.

(b)A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits that are considered nonqualified deferred compensation under Code Section 409A upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Code Section 409A, and, for purposes of any such provision of this

7

Agreement, references to a “termination,” “termination of employment” or like terms shall mean such a separation from service.  The determination of whether and when a separation from service has occurred for purposes of this Agreement shall be made in accordance with the presumptions set forth in Section 1.409A-1(h) of the Treasury Regulations.

(c)Any provision of this Agreement to the contrary notwithstanding, if at the time of the Executive’s separation from service, the Company determines that the Executive is a “specified employee,” within the meaning of Code Section 409A, then to the extent any payment or benefit that the Executive becomes entitled to under this Agreement on account of such separation from service would be considered nonqualified deferred compensation under Code Section 409A, such payment or benefit shall be paid or provided at the date which is the earlier of (i) six (6) months and one day after such separation from service, and (ii) the date of the Executive’s death (the “Delay Period”).  Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 9(c) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or provided to the Executive in a lump-sum with interest at the prime rate as published by The Wall Street Journal on the first business day of the Delay Period, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.

(d)Any reimbursements and in-kind benefits provided under this Agreement that constitute deferred compensation within the meaning of Code Section 409A shall be made or provided in accordance with the requirements of Code Section 409A, including, without limitation, that (i) in no event shall any fees, expenses or other amounts eligible to be reimbursed by the Company under this Agreement be paid later than the last day of the calendar year next following the calendar year in which the applicable fees, expenses or other amounts were incurred; (ii) the amount of expenses eligible for reimbursement, or in-kind benefits that the Company is obligated to pay or provide, in any given calendar year shall not affect the expenses that the Company is obligated to reimburse, or the in-kind benefits that the Company is obligated to pay or provide, in any other calendar year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect; (iii) the Executive’s right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit; and (iv) in no event shall the Company’s obligations to make such reimbursements or to provide such in-kind benefits apply later than the Executive’s remaining lifetime (or if longer, through the sixth (6th) anniversary of the Commencement Date).

(e)For purposes of Code Section 409A, the Executive’s right to receive any installment payments shall be treated as a right to receive a series of separate and distinct payments.  Whenever a payment under this Agreement specifies a payment period with reference to a number of days (for example, “payment shall be made within thirty (30) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.  In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement, to the extent such payment is subject to Code Section 409A.

(f)The Company makes no representation or warranty and shall have no liability to the Executive or any other person if any provisions of this Agreement are determined

8

to constitute deferred compensation subject to Code Section 409A but do not satisfy an exemption from, or the conditions of, Code Section 409A.

10.Say on Pay Limitations.

(a)Say on Pay Requirements.  Under Swiss say and pay law, the maximum aggregate amount of compensation of the executive management must be approved by the General Meeting of Shareholders of TE Connectivity Ltd. (the “GM”) as a public Swiss company. At each GM, the Company presents to the Company’s shareholders for approval the maximum aggregate amount of compensation that can be paid to the executive management in the next succeeding fiscal year.  If the GM does not approve the maximum aggregate amount of compensation of the executive management, the Company will determine whether and to what extent the Executive’s compensation in that fiscal year will be affected. If the Executive’s compensation is affected, this 2015 Agreement continues to be effective subject to paragraph (b) below.

(b)Non-Approval by GM. If the GM refuses to approve the proposed maximum aggregate compensation of the executive management, and Executive’s compensation is subject to the approval of the GM, the Executive by signing this 2015 Agreement (i) agrees to accept a modification - as determined by the Company - of the compensation and benefits under this 2015 Agreement, and (ii) if the Company decides to pay compensation on a provisional basis in view of what a following GM may approve, the Executive will have to repay any amount of compensation received but subsequently not approved by any following GM.

11.General.

(a)Governing Law.  This Agreement and the legal relations thus created between the parties hereto shall be governed by, and construed in accordance with, the internal laws of the Commonwealth of Pennsylvania, without giving effect to any choice of law or conflict of law provision or rule (whether of the Commonwealth of Pennsylvania or any other jurisdiction) that would cause the application of the law of any jurisdiction other than the Commonwealth of Pennsylvania.  The parties hereto acknowledge and agree that this Agreement was executed and delivered in the Commonwealth of Pennsylvania.

(b)Construction and Severability.  Whenever possible, each provision of this Agreement shall be construed and interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by, or invalid, illegal or unenforceable in any respect under, any applicable law or rule in any jurisdiction, such prohibition, invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any other jurisdiction, and the parties undertake to implement all efforts which are necessary, desirable and sufficient to amend, supplement or substitute all and any such prohibited, invalid, illegal or unenforceable provisions with enforceable and valid provisions in such jurisdiction which would produce as nearly as may be possible the result previously intended by the parties without renegotiation of any material terms and conditions stipulated herein.

(c)Cooperation. During the Employment Term and thereafter, the Executive shall cooperate with the Company and be reasonably available to the Company with respect to continuing and/or future matters related to the Executive’s employment period with the Company and/or its subsidiaries or affiliates, whether such matters are business-related, legal, regulatory or otherwise (including, without limitation, the Executive appearing at the Company’s request to give testimony without requiring service of a subpoena or other legal process, volunteering to the

9

Company all pertinent information and turning over to the Company all relevant documents which are or may come into the Executive’s possession).  Following the Employment Term, the Company shall reimburse the Executive for all reasonable out of pocket expenses incurred by the Executive in rendering such services that are approved by the Company.  In addition, if more than an incidental cooperation is required at any time after the termination of the Executive’s employment, the Executive shall be paid (other than for the time of actual testimony) a per day fee based on his base salary described in Section 5(a) at the time of such termination divided by 225.

(d)Successors and Assigns.  This Agreement shall bind and inure to the benefit of and be enforceable by the Company and its successors and assigns and the Executive and the Executive’s heirs, executors, administrators, and successors; provided that the services provided by the Executive under this Agreement are of a personal nature, and rights and obligations of the Executive under this Agreement shall not be assignable or delegable, except for any death payments otherwise due the Executive, which shall be payable to the estate of the Executive; provided further the Company may assign this Agreement to, and all rights hereunder shall inure to the benefit of, any subsidiary or affiliate of the Company or any person, firm or corporation resulting from the reorganization of the Company or succeeding to the business or assets of the Company by purchase, merger, consolidation or otherwise; and provided further that in the event of the Executive’s death, any unpaid amount due to the Executive under this Agreement shall be paid to his estate.

(e)Executive’s Representations.  The Executive hereby represents and warrants to the Company that:  (i) the execution, delivery and performance of this Agreement by the Executive do not and shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which the Executive is a party or by which the Executive is bound; (ii) the Executive is not a party to or bound by any employment agreement, noncompetition or nonsolicitation agreement or confidentiality agreement with any other person or entity besides the Company and (iii) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of the Executive, enforceable in accordance with its terms.  THE EXECUTIVE HEREBY ACKNOWLEDGES AND REPRESENTS THAT THE EXECUTIVE HAS CONSULTED WITH INDEPENDENT LEGAL COUNSEL REGARDING THE EXECUTIVE’S RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT, TO THE EXTENT DETERMINED NECESSARY OR APPROPRIATE BY THE EXECUTIVE, AND THAT THE EXECUTIVE FULLY UNDERSTANDS THE TERMS AND CONDITIONS CONTAINED HEREIN.

(f)Compliance with Rules and Policies.  The Executive shall perform all services in accordance with the policies, procedures and rules established by the Company and the Board, including, but not limited to, the Company’s Guide to Ethical Conduct.  In addition, the Executive shall comply with all laws, rules and regulations that are generally applicable to the Company or its subsidiaries or affiliates and their respective employees, directors and officers.

(g)Withholding Taxes.  All amounts payable hereunder shall be subject to the withholding of all applicable taxes and deductions required by any applicable law.

(h)Entire Agreement.  This Agreement constitutes the entire agreement and understanding between the parties hereto with respect to the subject matter hereof and terminates

10

and supersedes any and all prior agreements, understandings and representations, whether written or oral, by or between the parties hereto or their affiliates which may have related to the subject matter hereof in any way, including, without limitation, and any other existing employment agreement or change of control agreement, which is hereby terminated and cancelled and of no further force or effect as of the Commencement Date, without the payment of any additional consideration by or to either of the parties hereto; provided, however, that the agreements referenced in Section 6, any agreement between the parties addressing the terms and conditions of Executive’s expatriate assignment or relocation, as applicable, and any agreement issued under the terms of any compensation or employee benefit plan described herein or in which the Executive is otherwise a participant shall not be affected by this Section 10(h).  Notwithstanding any provision of this Agreement to the contrary, neither the assignment of the Executive to a different Reporting Officer due to a reorganization or an internal restructuring of the Company or its subsidiaries or affiliates nor a change in the Reporting Officer’s title shall constitute a modification or a breach of this Agreement.

(i)Duration.  Notwithstanding the Employment Term hereunder, this Agreement shall continue for so long as any obligations remain under this Agreement.

(j)Survival.  The covenants set forth in the agreements referenced in Section 6 and the covenants set forth in Section 10(c) of this Agreement shall survive and shall continue to be binding upon the Executive notwithstanding the termination of this Agreement for any reason whatsoever.

(k)Amendment and Waiver.  The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and the Executive, and no course of conduct or course of dealing or failure or delay by any party hereto in enforcing or exercising any of the provisions of this Agreement (including, without limitation, the Company’s right to terminate the Employment Term for Cause) shall affect the validity, binding effect or enforceability of this Agreement or be deemed to be an implied waiver of any similar or dissimilar requirement, provision or condition of this Agreement at the same or any prior or subsequent time.  Pursuit by either party of any available remedy, either in law or equity, or any action of any kind, does not constitute waiver of any other remedy or action.  Such remedies and actions are cumulative and not exclusive.

(l)Counterparts.  This Agreement may be executed in two or more counterparts, all of which taken together shall constitute one instrument.

(m)Section References.  Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.  The words Section and paragraph herein shall refer to provisions of this Agreement unless expressly indicated otherwise.

(n)No Strict Construction.  The parties hereto have participated jointly in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring either party hereto by virtue of the authorship of any of the provisions of this Agreement.

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(o)Time of the Essence; Computation of Time.  Time is of the essence for each and every provision of this Agreement.  Whenever the last day for the exercise of any privilege or the discharge or any duty hereunder shall fall upon a Saturday, Sunday, or any date on which banks in Berwyn, Pennsylvania are authorized to be closed, the party having such privilege or duty may exercise such privilege or discharge such duty on the next succeeding day which is a regular business day.

(p)No Third Party Beneficiaries.  Nothing in this Agreement, express or implied, is intended or shall be construed to give any person other than the parties to this Agreement and their respective heirs, executors, administrators, successors or permitted assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.

(q)Forfeiture and Clawback.  The Executive acknowledges and agrees that, notwithstanding anything in this Agreement to the contrary, this Agreement and all amounts payable hereunder shall be subject to any applicable compensation, clawback and recoupment policies implemented by the Board, as may be in effect from time to time.

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have hereunto executed this Agreement as of the day and year first written above.

	TYCO ELECTRONICS CORPORATION
Date:	By:	/s/ Harold G. Barksdale
		Name:	Harold G. Barksdale
		Title:	Corporate Secretary
	Kevin N. Rock
Date: 12/15/2015	/s/ Kevin N. Rock

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EX-31.1

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Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Terrence R. Curtin, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of TE Connectivity Ltd.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions);

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: January 24, 2019

/s/ TERRENCE R. CURTIN
Terrence R. Curtin
Chief Executive Officer

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Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

EX-31.2

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Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Heath A. Mitts, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of TE Connectivity Ltd.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions);

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: January 24, 2019

/s/ HEATH A. MITTS
Heath A. Mitts
Executive Vice President and Chief Financial Officer

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Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

EX-32.1

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Exhibit 32.1

TE CONNECTIVITY LTD.
CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        The undersigned officers of TE Connectivity Ltd. (the "Company") hereby certify to their knowledge that the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 28, 2018 (the "Report"), as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ TERRENCE R. CURTIN
Terrence R. Curtin
Chief Executive Officer

January 24, 2019

/s/ HEATH A. MITTS
Heath A. Mitts
Executive Vice President and Chief Financial Officer

January 24, 2019

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Exhibit 32.1

TE CONNECTIVITY LTD. CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

XML

Document and Entity Information - shares	3 Months Ended
	Dec. 28, 2018	Jan. 18, 2019
Document and Entity Information
Entity Registrant Name	TE Connectivity Ltd.
Entity Central Index Key	0001385157
Document Type	10-Q
Document Period End Date	Dec. 28, 2018
Amendment Flag	false
Current Fiscal Year End Date	--09-27
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		338,854,434
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Net sales	$ 3,347	$ 3,336
Cost of sales	2,233	2,172
Gross margin	1,114	1,164
Selling, general, and administrative expenses	389	377
Research, development, and engineering expenses	161	165
Acquisition and integration costs	5	2
Restructuring and other charges, net	75	34
Operating income	484	586
Interest income	5	4
Interest expense	(27)	(26)
Other income (expense), net	(1)	2
Income from continuing operations before income taxes	461	566
Income tax expense	(78)	(599)
Income (loss) from continuing operations	383	(33)
Loss from discontinued operations, net of income taxes	(107)	(7)
Net income (loss)	$ 276	$ (40)
Basic earnings (loss) per share:
Income (loss) from continuing operations (in dollars per share)	$ 1.12	$ (0.09)
Loss from discontinued operations (in dollars per share)	(0.31)	(0.02)
Net income (loss) (in dollars per share)	0.81	(0.11)
Diluted earnings (loss) per share:
Income (loss) from continuing operations (in dollars per share)	1.11	(0.09)
Loss from discontinued operations (in dollars per share)	(0.31)	(0.02)
Net income (loss) (in dollars per share)	$ 0.80	$ (0.11)
Weighted-average number of shares outstanding:
Basic (in shares)	342	352
Diluted (in shares)	344	352

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income (loss)	$ 276	$ (40)
Other comprehensive income:
Currency translation	19	67
Adjustments to unrecognized pension and postretirement benefit costs, net of income taxes	6	7
Gains on cash flow hedges, net of income taxes	24	2
Other comprehensive income	49	76
Comprehensive income	$ 325	$ 36

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Dec. 28, 2018	Sep. 28, 2018
Current assets:
Cash and cash equivalents	$ 505	$ 848
Accounts receivable, net of allowance for doubtful accounts of $26 and $22, respectively	2,380	2,361
Inventories	1,986	1,857
Prepaid expenses and other current assets	507	661
Current assets held for sale		472
Total current assets	5,378	6,199
Property, plant, and equipment, net	3,550	3,497
Goodwill	5,648	5,684
Intangible assets, net	1,648	1,704
Deferred income taxes	2,580	2,144
Other assets	384	1,158
Total Assets	19,188	20,386
Current liabilities:
Short-term debt	585	963
Accounts payable	1,538	1,548
Accrued and other current liabilities	1,348	1,711
Current liabilities held for sale		188
Total current liabilities	3,471	4,410
Long-term debt	3,382	3,037
Long-term pension and postretirement liabilities	1,101	1,102
Deferred income taxes	207	207
Income taxes	335	312
Other liabilities	456	487
Total Liabilities	8,952	9,555
Commitments and contingencies (Note 8)
Shareholders' equity:
Common shares, CHF 0.57 par value, 357,069,981 shares authorized and issued	157	157
Accumulated earnings	11,886	12,114
Treasury shares, at cost, 17,727,608 and 12,279,603 shares, respectively	(1,550)	(1,134)
Accumulated other comprehensive loss	(257)	(306)
Total Shareholders' Equity	10,236	10,831
Total Liabilities and Shareholders' Equity	$ 19,188	$ 20,386

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Millions	Dec. 28, 2018 SFr / shares	Dec. 28, 2018 USD ($) shares	Sep. 28, 2018 SFr / shares	Sep. 28, 2018 USD ($) shares
CONDENSED CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance for doubtful accounts (in dollars) | $		$ 26		$ 22
Common shares, par value (in currency per share) | SFr / shares	SFr 0.57		SFr 0.57
Common shares, shares authorized		357,069,981		357,069,981
Common shares, shares issued		357,069,981		357,069,981
Treasury shares		17,727,608		12,279,603

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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Millions, $ in Millions	Common Shares	Treasury Shares	Contributed Surplus	Accumulated Earnings	Accumulated Other Comprehensive Loss	Total
Balance at Sep. 29, 2017	$ 157	$ (421)		$ 10,175	$ (160)	$ 9,751
Balance (in shares) at Sep. 29, 2017	357	(5)
Increase (Decrease) in Equity:
Net income (loss)				(40)		(40)
Other comprehensive income					76	76
Share-based compensation expense			$ 29			29
Exercise of share options		$ 54				54
Exercise of share options (in shares)		1
Restricted share award vestings and other activity		$ 92	(29)	(88)		(25)
Repurchase of common shares		$ (214)				$ (214)
Repurchase of common shares (in shares)		(2)				(2)
Balance at Dec. 29, 2017	$ 157	$ (489)		10,047	(84)	$ 9,631
Balance (in shares) at Dec. 29, 2017	357	(6)
Balance at Sep. 28, 2018	$ 157	$ (1,134)		12,114	(306)	10,831
Balance (in shares) at Sep. 28, 2018	357	(12)
Increase (Decrease) in Equity:
Adoption of ASU No. 2016-16 | ASU 2016-16				(443)		(443)
Net income (loss)				276		276
Other comprehensive income					49	49
Share-based compensation expense			23			23
Exercise of share options		$ 7				7
Restricted share award vestings and other activity		72	$ (23)	(61)		(12)
Repurchase of common shares		$ (495)				$ (495)
Repurchase of common shares (in shares)		(6)				(6)
Balance at Dec. 28, 2018	$ 157	$ (1,550)		$ 11,886	$ (257)	$ 10,236
Balance (in shares) at Dec. 28, 2018	357	(18)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Cash Flows From Operating Activities:
Net income (loss)	$ 276	$ (40)
Loss from discontinued operations, net of income taxes	107	7
Income (loss) from continuing operations	383	(33)
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities:
Depreciation and amortization	168	162
Deferred income taxes	(11)	510
Provision for losses on accounts receivable and inventories	23	17
Share-based compensation expense	23	28
Other	18	(6)
Changes in assets and liabilities, net of the effects of acquisitions and divestitures:
Accounts receivable, net	(26)	(139)
Inventories	(119)	(177)
Prepaid expenses and other current assets	67	(45)
Accounts payable	(9)	161
Accrued and other current liabilities	(190)	(239)
Income taxes	15	7
Other	(14)	37
Net cash provided by continuing operating activities	328	283
Net cash provided by (used in) discontinued operating activities	(31)	67
Net cash provided by operating activities	297	350
Cash Flows From Investing Activities:
Capital expenditures	(210)	(237)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation	288
Other	4
Net cash provided by (used in) continued investing activities	82	(237)
Net cash used in discontinued investing activities	(2)	(4)
Net cash provided by (used in) investing activities	80	(241)
Cash Flows From Financing Activities:
Net increase in commercial paper	63	241
Proceeds from issuance of debt	350	119
Repayment of debt	(441)	(708)
Proceeds from exercise of share options	7	54
Repurchase of common shares	(519)	(167)
Payment of common share dividends to shareholders	(150)	(141)
Transfers (to) from discontinued operations	(33)	63
Other	(29)	(32)
Net cash used in continuing financing activities	(752)	(571)
Net cash provided by (used in) discontinued financing activities	33	(63)
Net cash used in financing activities	(719)	(634)
Effect of currency translation on cash	(1)	11
Net decrease in cash, cash equivalents, and restricted cash	(343)	(514)
Cash, cash equivalents, and restricted cash at beginning of period	848	1,218
Cash, cash equivalents, and restricted cash at end of period	$ 505	$ 704

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Basis of Presentation and Accounting Policies

3 Months Ended

Dec. 28, 2018

Basis of Presentation and Accounting Policies

Basis of Presentation and Accounting Policies

1. Basis of Presentation and Accounting Policies

Basis of Presentation

        The unaudited Condensed Consolidated Financial Statements of TE Connectivity Ltd. ("TE Connectivity" or the "Company," which may be referred to as "we," "us," or "our") have been prepared in United States ("U.S.") dollars, in accordance with accounting principles generally accepted in the U.S. ("GAAP") and the instructions to Form 10-Q under the Securities Exchange Act of 1934. In management's opinion, the unaudited Condensed Consolidated Financial Statements contain all normal recurring adjustments necessary for a fair presentation of interim results. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire fiscal year or any subsequent interim period.

        The year-end balance sheet data was derived from audited financial statements, but does not include all of the information and disclosures required by GAAP. These financial statements should be read in conjunction with our audited Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended September 28, 2018.

        Unless otherwise indicated, references in the Condensed Consolidated Financial Statements to fiscal 2019 and fiscal 2018 are to our fiscal years ending September 27, 2019 and ended September 28, 2018, respectively.

Revenue Recognition

        We account for revenue in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers, which introduced a single, comprehensive, five-step revenue recognition model. Our revenues are generated principally from the sale of our products. Revenue is recognized as performance obligations under the terms of a contract, such as a purchase order with a customer, are satisfied; generally this occurs with the transfer of control. We transfer control and recognize revenue when we ship product to our customers, the customers accept and have legal title for the product, and we have a right to payment for such product. Revenue is measured as the amount of consideration that we expect to receive in exchange for those products and excludes taxes assessed by governmental authorities and collected from customers concurrent with the sale of products. Shipping and handling costs are treated as fulfillment costs and are included in cost of sales. Since we typically invoice our customers when we satisfy our performance obligations, we do not have material contract assets or contract liabilities. Our credit terms are customary and do not contain significant financing components that extend beyond one year of fulfillment of performance obligations. We apply the practical expedient of ASC 606 with respect to financing components and do not evaluate contracts in which payment is due within one year of satisfaction of the related performance obligation. Since our performance obligations to deliver products are part of contracts that generally have original durations of one year or less, we have elected to use the optional exemption to not disclose the aggregate amount of transaction prices associated with unsatisfied or partially satisfied performance obligations as of December 28, 2018. See Note 15 for net sales disaggregated by industry end market and geographic region which is summarized by segment and that we consider meaningful to depict the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors.

        We generally warrant that our products will conform to our, or mutually agreed to, specifications and that our products will be free from material defects in materials and workmanship for a limited time. We limit our warranty to the replacement or repair of defective parts, or a refund or credit of the price of the defective product. We do not account for these warranties as separate performance obligations.

        Although products are generally sold at fixed prices, certain distributors and customers receive incentives or awards, such as sales rebates, return allowances, scrap allowances, and other rights, which are accounted for as variable consideration. We estimate these amounts in the same period revenue is recognized based on the expected value to be provided to customers and reduce revenue accordingly. Our estimates of variable consideration and ultimate determination of the estimated amounts to include in the transaction price are based primarily on our assessment of anticipated performance and historical and forecasted information that is reasonably available to us.

Recently Adopted Accounting Pronouncements

        In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-12, an update to ASC 815, Derivatives and Hedging. The update improves and simplifies hedge accounting and related disclosures. We elected to early adopt this update, which did not have a material impact on our Condensed Consolidated Financial Statements, in the quarter ended December 28, 2018.

        In October 2016, the FASB issued ASU No. 2016-16, an update to ASC 740, Income Taxes. This guidance requires the recognition of the income tax consequences of intra-entity transfers of assets other than inventory in the period in which the transfer occurs. The update was adopted on a modified retrospective basis in the quarter ended December 28, 2018 and resulted in a $443 million cumulative-effect adjustment to beginning accumulated earnings, which represented the net reversal of all balances associated with deferred tax impacts of intra-entity transfers of assets other than inventory. This included a decrease in other assets of $798 million, an increase in deferred tax assets of $418 million, and a decrease in prepaid expenses and other current assets of $63 million on the Condensed Consolidated Balance Sheet.

        In May 2014, the FASB issued ASU No. 2014-09 which codified ASC 606, Revenue from Contracts with Customers. This guidance supersedes ASC 605, Revenue Recognition, and introduces a single, comprehensive, five-step revenue recognition model. ASC 606 also enhances disclosures related to revenue recognition. We adopted ASC 606, as amended, in the quarter ended December 28, 2018 using a modified retrospective approach. Prior period amounts have not been adjusted and continue to be reported under the accounting standards in effect for those periods. Transition impacts, which relate primarily to incentive compensation arrangements, were not material to our results of operations or financial position. Because the impact of adoption was immaterial, we have not recorded a cumulative-effect adjustment to beginning accumulated earnings.

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Restructuring and Other Charges, Net

3 Months Ended

Dec. 28, 2018

Restructuring and Other Charges, Net

Restructuring and Other Charges, Net

2. Restructuring and Other Charges, Net

        Net restructuring charges by segment were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions	$	21	$	4
Industrial Solutions		35		22
Communications Solutions		19		8
Restructuring charges, net	$	75	$	34

        Activity in our restructuring reserves was as follows:

	Balance at September 28, 2018		Charges		Changes in Estimate			Cash Payments			Non-Cash Items			Currency Translation			Balance at December 28, 2018
	(in millions)
Fiscal 2019 Actions:
Employee severance	$	—	$	67	$	—		$	(4	)	$	—		$	—		$	63
Fiscal 2018 Actions:
Employee severance		114		1		—			(16	)		—			(2	)		97
Facility and other exit costs		4		1		—			(1	)		—			—			4
Property, plant and equipment		—		1		—			—			(1	)		—			—
Total		118		3		—			(17	)		(1	)		(2	)		101
Pre-Fiscal 2018 Actions:
Employee severance		49		4		(1	)		(8	)		—			(1	)		43
Facility and other exit costs		—		1		—			(1	)		—			—			—
Property, plant and equipment		—		1		—			—			(1	)		—			—
Total		49		6		(1	)		(9	)		(1	)		(1	)		43
Total Activity	$	167	$	76	$	(1	)	$	(30	)	$	(2	)	$	(3	)	$	207

Fiscal 2019 Actions

        During fiscal 2019, we initiated a restructuring program associated with footprint consolidation and structural improvements impacting all segments. In connection with this program, during the quarter ended December 28, 2018, we recorded restructuring charges of $67 million. We expect to complete all restructuring actions commenced during the quarter ended December 28, 2018 by the end of fiscal 2020 and to incur additional charges of approximately $10 million primarily in the Industrial Solutions segment.

Fiscal 2018 Actions

        During fiscal 2018, we initiated a restructuring program associated with footprint consolidation and structural improvements primarily impacting the Industrial Solutions and Transportation Solutions segments. In connection with this program, during the quarters ended December 28, 2018 and December 29, 2017, we recorded restructuring charges of $3 million and $22 million, respectively. We expect to complete all restructuring actions commenced during fiscal 2018 by the end of fiscal 2020 and to incur additional charges of approximately $10 million primarily in the Industrial Solutions segment.

Pre-Fiscal 2018 Actions

        Prior to fiscal 2018, we initiated a restructuring program associated with footprint consolidation related to recent acquisitions and structural improvements impacting all segments. Also prior to fiscal 2018, we initiated a restructuring program associated with headcount reductions impacting all segments and product line closures in the Communications Solutions segment. During the quarters ended December 28, 2018 and December 29, 2017, we recorded net restructuring charges of $5 million and $12 million, respectively, related to pre-fiscal 2018 actions. We expect additional charges related to pre-fiscal 2018 actions to be insignificant.

Total Restructuring Reserves

        Restructuring reserves included on the Condensed Consolidated Balance Sheets were as follows:

	December 28, 2018		September 28, 2018
	(in millions)
Accrued and other current liabilities	$	183	$	141
Other liabilities		24		26
Restructuring reserves	$	207	$	167

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Discontinued Operations

3 Months Ended

Dec. 28, 2018

Discontinued Operations

Discontinued Operations

3. Discontinued Operations

        During the quarter ended December 28, 2018, we sold our Subsea Communications ("SubCom") business for net cash proceeds of $288 million and incurred a pre-tax loss on sale of $96 million, related primarily to the recognition of cumulative translation adjustment losses of $67 million. The transaction is subject to a final working capital adjustment. The SubCom business met the held for sale and discontinued operations criteria and was reported as such in all periods presented on the Condensed Consolidated Financial Statements. Prior to reclassification to discontinued operations, the SubCom business was included in the Communications Solutions segment.

        In connection with the sale, we contractually agreed to continue to honor performance guarantees and letters of credit related to the SubCom business' projects that existed as of the date of sale. These guarantees have a combined value of approximately $1.7 billion and are expected to expire at various dates through fiscal 2025; however, the majority are expected to expire within two years. At the time of sale, we determined that the fair value of these guarantees was $12 million, which we recognized by a charge to pre-tax loss on sale. Also, under the terms of the definitive agreement, we are required to issue up to $300 million of new performance guarantees, subject to certain limitations, for projects entered into by the SubCom business following the sale for a period of up to three years. During the quarter ended December 28, 2018, we issued a guarantee of $70 million for a new project. We have contractual recourse against the SubCom business if we are required to perform on any SubCom guarantees; however, based on historical experience, we do not anticipate having to perform.

        The following table presents the summarized components of loss from discontinued operations, net of income taxes, for the SubCom business and prior divestitures:

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Net sales	$	41		$	143
Cost of sales		(50	)		(132	)
Selling, general, and administrative expenses		(4	)		(7	)
Research, development, and engineering expenses		(3	)		(10	)
Restructuring and other charges, net		(3	)		—
Pre-tax loss from discontinued operations		(19	)		(6	)
Pre-tax loss on sale of discontinued operations		(96	)		—
Income tax (expense) benefit		8			(1	)
Loss from discontinued operations, net of income taxes	$	(107	)	$	(7	)

        The following table presents balance sheet information for assets and liabilities held for sale at September 28, 2018; there were no such balances at December 28, 2018:

	September 28, 2018
	(in millions)
Accounts receivable, net	$	72
Inventories		130
Other current assets		32
Property, plant, and equipment, net		221
Other assets		17
Total assets held for sale	$	472
Accounts payable	$	63
Accrued and other current liabilities		26
Deferred revenue		60
Other liabilities		39
Total liabilities held for sale	$	188

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Inventories

3 Months Ended

Dec. 28, 2018

Inventories

Inventories

4. Inventories

        Inventories consisted of the following:

	December 28, 2018		September 28, 2018
	(in millions)
Raw materials	$	306	$	276
Work in progress		735		656
Finished goods		945		925
Inventories	$	1,986	$	1,857

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Goodwill

3 Months Ended

Dec. 28, 2018

Goodwill

Goodwill

5. Goodwill

        The changes in the carrying amount of goodwill by segment were as follows:

	Transportation Solutions			Industrial Solutions			Communications Solutions			Total
	(in millions)
September 28, 2018(1)	$	1,993		$	3,104		$	587		$	5,684
Currency translation and other		(13	)		(19	)		(4	)		(36	)
December 28, 2018(1)	$	1,980		$	3,085		$	583		$	5,648

(1)          At December 28, 2018 and September 28, 2018, accumulated impairment losses for the Transportation Solutions, Industrial Solutions, and Communications Solutions segments were $2,191 million, $669 million, and $489 million, respectively.

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Intangible Assets, Net

3 Months Ended

Dec. 28, 2018

Intangible Assets, Net

Intangible Assets, Net

6. Intangible Assets, Net

        Intangible assets consisted of the following:

	December 28, 2018							September 28, 2018
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(in millions)
Customer relationships	$	1,457	$	(410	)	$	1,047	$	1,468	$	(389	)	$	1,079
Intellectual property		1,257		(673	)		584		1,261		(653	)		608
Other		34		(17	)		17		33		(16	)		17
Total	$	2,748	$	(1,100	)	$	1,648	$	2,762	$	(1,058	)	$	1,704

        Intangible asset amortization expense was $45 million for the quarters ended December 28, 2018 and December 29, 2017.

        At December 28, 2018, the aggregate amortization expense on intangible assets is expected to be as follows:

	(in millions)
Remainder of fiscal 2019	$	136
Fiscal 2020		175
Fiscal 2021		172
Fiscal 2022		172
Fiscal 2023		171
Fiscal 2024		140
Thereafter		682
Total	$	1,648

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Debt

3 Months Ended

Dec. 28, 2018

Debt

Debt

7. Debt

        During November 2018, Tyco Electronics Group S.A. ("TEGSA"), our 100%-owned subsidiary, issued $350 million aggregate principal amount of senior floating rate notes due June 2020. The notes bear interest at a rate of three-month London Interbank Offered Rate ("LIBOR") plus 0.45% per year. The notes are TEGSA's unsecured senior obligations and rank equally in right of payment with all existing and any future senior indebtedness of TEGSA and senior to any subordinated indebtedness that TEGSA may incur.

        During December 2018, TEGSA repaid, at maturity, $325 million 2.375% senior notes due 2018.

        TEGSA has a five-year unsecured senior revolving credit facility ("Credit Facility") with total commitments of $1,500 million. The Credit Facility was amended in November 2018 primarily to extend the maturity date from December 2020 to November 2023. The amended Credit Facility contains provisions that allow for incremental commitments of up to $500 million, an option to temporarily increase the financial ratio covenant following a qualified acquisition, and borrowings in designated currencies. TEGSA had no borrowings under the Credit Facility at December 28, 2018 or September 28, 2018.

        As of December 28, 2018, TEGSA had $333 million of commercial paper outstanding at a weighted-average interest rate of 2.94%. TEGSA had $270 million of commercial paper outstanding at a weighted-average interest rate of 2.35% at September 28, 2018.

        The fair value of our debt, based on indicative valuations, was approximately $4,091 million and $4,149 million at December 28, 2018 and September 28, 2018, respectively.

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Commitments and Contingencies

3 Months Ended

Dec. 28, 2018

Commitments and Contingencies

Commitments and Contingencies

8. Commitments and Contingencies

Legal Proceedings

        In the normal course of business, we are subject to various legal proceedings and claims, including patent infringement claims, product liability matters, employment disputes, disputes on agreements, other commercial disputes, environmental matters, antitrust claims, and tax matters, including non-income tax matters such as value added tax, sales and use tax, real estate tax, and transfer tax. Although it is not feasible to predict the outcome of these proceedings, based upon our experience, current information, and applicable law, we do not expect that the outcome of these proceedings, either individually or in the aggregate, will have a material effect on our results of operations, financial position, or cash flows.

Environmental Matters

        We are involved in various stages of investigation and cleanup related to environmental remediation matters at a number of sites. The ultimate cost of site cleanup is difficult to predict given the uncertainties regarding the extent of the required cleanup, the interpretation of applicable laws and regulations, and alternative cleanup methods. As of December 28, 2018, we concluded that we would incur investigation and remediation costs at these sites in the reasonably possible range of $15 million to $44 million, and we accrued $17 million as the probable loss, which was the best estimate within this range. We believe that any potential payment of such estimated amounts will not have a material adverse effect on our results of operations, financial position, or cash flows.

Guarantees

        In disposing of assets or businesses, we often provide representations, warranties, and/or indemnities to cover various risks including unknown damage to assets, environmental risks involved in the sale of real estate, liability for investigation and remediation of environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not expect that these uncertainties will have a material adverse effect on our results of operations, financial position, or cash flows.

        At December 28, 2018, we had outstanding letters of credit, letters of guarantee, and surety bonds of $286 million.

        We sold our SubCom business during the quarter ended December 28, 2018. In connection with the sale, we contractually agreed to honor certain performance guarantees and letters of credit related to the SubCom business. See Note 3 for additional information regarding these guarantees and the divestiture of the SubCom business.

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Financial Instruments

3 Months Ended

Dec. 28, 2018

Financial Instruments

Financial Instruments

9. Financial Instruments

Foreign Currency Exchange Rate Risk

        During fiscal 2015, we entered into cross-currency swap contracts with an aggregate notional value of €1,000 million to reduce our exposure to foreign currency exchange rate risk associated with certain intercompany loans. Under the terms of these contracts, which have been designated as cash flow hedges, we make interest payments in euros at 3.50% per annum and receive interest in U.S. dollars at a weighted-average rate of 5.33% per annum. Upon maturity of these contracts in fiscal 2022, we will pay the notional value of the contracts in euros and receive U.S. dollars from our counterparties. In connection with the cross-currency swap contracts, we are required to post cash collateral with our counterparties.

        At December 28, 2018 and September 28, 2018, our cross-currency swap contracts were in liability positions of $64 million and $100 million, respectively, and were recorded in other liabilities on the Condensed Consolidated Balance Sheets. At December 28, 2018 and September 28, 2018, collateral paid to our counterparties approximated the derivative positions and was recorded in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets. The impacts of our cross-currency swap contracts were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Gains (losses) recorded in other comprehensive income (loss)	$	19	$	(10	)
Gains (losses) excluded from the hedging relationship(1)		17		(19	)

(1)          Gains and losses excluded from the hedging relationship are recognized prospectively in selling, general, and administrative expenses and are offset by losses and gains generated as a result of re-measuring certain intercompany loans to the U.S. dollar.

Hedge of Net Investment

        During fiscal 2019, we expanded our cross-currency swap program to hedge our net investment in certain foreign operations. The aggregate notional value of this program was $952 million at December 28, 2018. Under the terms of these contracts, we receive interest in U.S. dollars at a weighted-average rate of 3.06% per annum and pay no interest. Upon maturity of these contracts at various dates through fiscal 2022, we will pay the notional value of the contracts in the designated foreign currency and receive U.S. dollars from our counterparties.

        In addition to the cross-currency swap program, we hedge our net investment in certain foreign operations using intercompany loans and external borrowings denominated in the same currencies. The aggregate notional value of these hedges was $3,189 million and $4,064 million at December 28, 2018 and September 28, 2018, respectively.

        The impacts of our hedging programs were as follows:

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Foreign currency exchange gains (losses) on intercompany loans and external borrowings(1)	$	76		$	(66	)
Losses on cross-currency swaps designated as hedge of net investment(2)		(5	)		—

(1)          Foreign currency exchange gains and losses on intercompany loans and external borrowings are recorded as currency translation, a component of accumulated other comprehensive income (loss), and are offset by changes attributable to the translation of the net investment.

(2)          Gains and losses on cross-currency swaps designated as hedge of net investment are recorded as currency translation.

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Retirement Plans

3 Months Ended

Dec. 28, 2018

Retirement Plans

Retirement Plans

10. Retirement Plans

        The net periodic pension benefit cost for all non-U.S. and U.S. defined benefit pension plans was as follows:

	Non-U.S. Plans						U.S. Plans
	For the Quarters Ended						For the Quarters Ended
	December 28, 2018			December 29, 2017			December 28, 2018			December 29, 2017
	(in millions)
Service cost	$	12		$	12		$	3		$	3
Interest cost		11			10			12			11
Expected return on plan assets		(16	)		(17	)		(14	)		(15	)
Amortization of net actuarial loss		6			6			4			6
Amortization of prior service credit		(2	)		(2	)		—			—
Net periodic pension benefit cost	$	11		$	9		$	5		$	5

        The components of net periodic pension benefit cost other than service cost are included in net other income (expense) on the Condensed Consolidated Statements of Operations.

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Income Taxes

3 Months Ended

Dec. 28, 2018

Income Taxes

Income Taxes

11. Income Taxes

        We recorded income tax expense of $78 million and $599 million for the quarters ended December 28, 2018 and December 29, 2017, respectively. The income tax expense for the quarter ended December 29, 2017 included $567 million of income tax expense related to the tax impacts of the Tax Cuts and Jobs Act (the "Act") and a $61 million net income tax benefit related to certain legal entity restructurings. During the quarter ended December 29, 2017, the period of enactment of the Act, we were required to revalue our U.S. federal deferred tax assets and liabilities at a U.S. federal corporate tax rate of 21% and we recorded income tax expense of $567 million primarily in connection with the write-down of our U.S. federal deferred tax asset for net operating loss and interest carryforwards. Included in the expense of $567 million was an income tax benefit of $34 million related to the reduction in the existing valuation allowance recorded against certain U.S. federal tax credit carryforwards.

        We record accrued interest and penalties related to uncertain tax positions as part of income tax expense. As of December 28, 2018 and September 28, 2018, we had $63 million and $60 million, respectively, of accrued interest and penalties related to uncertain tax positions on the Condensed Consolidated Balance Sheets, recorded primarily in income taxes.

        Although it is difficult to predict the timing or results of our worldwide examinations, we estimate that up to approximately $125 million of unrecognized income tax benefits, excluding the impact relating to accrued interest and penalties, could be resolved within the next twelve months.

        We are not aware of any other matters that would result in significant changes to the amount of unrecognized income tax benefits reflected on the Condensed Consolidated Balance Sheet as of December 28, 2018.

Tax Sharing Agreement

        Under a Tax Sharing Agreement, we, Tyco International plc ("Tyco International"), and Covidien plc ("Covidien") share 31%, 27%, and 42%, respectively, of income tax liabilities that arise from adjustments made by tax authorities to the collective income tax returns for periods prior to and including June 29, 2007. Pursuant to the Tax Sharing Agreement, we entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. We have substantially settled all U.S. federal income tax matters with the IRS for periods covered under the Tax Sharing Agreement. Certain shared U.S. state and non-U.S. income tax matters remain open. We do not expect these matters will have a material effect on our results of operations, financial position, or cash flows. As a result of subsequent transactions, Tyco International and Covidien now operate as part of Johnson Controls International plc and Medtronic plc, respectively.

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Earnings (Loss) Per Share

3 Months Ended

Dec. 28, 2018

Earnings (Loss) Per Share

Earnings (Loss) Per Share

12. Earnings (Loss) Per Share

        The weighted-average number of shares outstanding used in the computations of basic and diluted earnings (loss) per share were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Basic		342		352
Dilutive impact of share-based compensation arrangements		2		—
Diluted		344		352

        There were one million share options that were not included in the computation of diluted earnings (loss) per share for the quarters ended December 28, 2018 and December 29, 2017 because the instruments' underlying exercise prices were greater than the average market prices of our common shares and inclusion would be antidilutive.

        For the quarter ended December 29, 2017, there were three million nonvested share awards and options outstanding with underlying exercise prices less than the average market prices of our common shares; however, these were excluded from the calculation of diluted loss per share as inclusion would be antidilutive as a result of our loss during the period.

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Shareholders' Equity

3 Months Ended

Dec. 28, 2018

Shareholders' Equity

Shareholders' Equity

13. Shareholders' Equity

Dividends

        We paid cash dividends to shareholders of $0.44 and $0.40 per share during the quarters ended December 28, 2018 and December 29, 2017, respectively.

        Upon shareholders' approval of a dividend payment, we record a liability with a corresponding charge to shareholders' equity. At December 28, 2018 and September 28, 2018, the unpaid portion of the dividends recorded in accrued and other current liabilities on the Condensed Consolidated Balance Sheets totaled $149 million and $303 million, respectively.

Share Repurchase Program

        During the quarter ended December 28, 2018, our board of directors authorized an increase of $1.5 billion in the share repurchase program. Common shares repurchased under the share repurchase program were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Number of common shares repurchased		6		2
Repurchase value	$	495	$	214

        At December 28, 2018, we had $2.0 billion of availability remaining under our share repurchase authorization.

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Share Plans

3 Months Ended

Dec. 28, 2018

Share Plans

Share Plans

14. Share Plans

        Share-based compensation expense, which was included in selling, general, and administrative expenses on the Condensed Consolidated Statements of Operations, was as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Share-based compensation expense	$	23	$	28

        As of December 28, 2018, there was $179 million of unrecognized compensation expense related to share-based awards, which is expected to be recognized over a weighted-average period of 2.3 years.

        During the quarter ended December 28, 2018, we granted the following share-based awards as part of our annual incentive plan grant:

	Shares		Grant-Date Fair Value
	(in millions)
Share options		1.6	$	13.36
Restricted share awards		0.6		76.66
Performance share awards		0.2		76.66

        As of December 28, 2018, we had 17 million shares available for issuance under our stock and incentive plans, of which the TE Connectivity Ltd. 2007 Stock and Incentive Plan, amended and restated as of March 8, 2017, was the primary plan.

Share-Based Compensation Assumptions

        The assumptions we used in the Black-Scholes-Merton option pricing model for the options granted as part of our annual incentive plan grant were as follows:

Expected share price volatility		20	%
Risk free interest rate		3.0	%
Expected annual dividend per share	$	1.76
Expected life of options (in years)		5.2

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Segment and Geographic Data

3 Months Ended

Dec. 28, 2018

Segment and Geographic Data

Segment and Geographic Data

15. Segment and Geographic Data

        Net sales by segment(1) and industry end market(2) were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions:
Automotive	$	1,469	$	1,517
Commercial transportation		297		300
Sensors		220		215
Total Transportation Solutions		1,986		2,032
Industrial Solutions:
Industrial equipment		483		471
Aerospace, defense, oil, and gas		285		254
Energy		160		157
Total Industrial Solutions		928		882
Communications Solutions:
Data and devices		257		238
Appliances		176		184
Total Communications Solutions		433		422
Total	$	3,347	$	3,336

(1)          Intersegment sales were not material and were recorded at selling prices that approximated market prices.

(2)          Industry end market information is presented consistently with our internal management reporting and may be revised periodically as management deems necessary.

        Net sales by geographic region(1) and segment were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Europe/Middle East/Africa ("EMEA"):
Transportation Solutions	$	756	$	808
Industrial Solutions		350		344
Communications Solutions		65		66
Total EMEA		1,171		1,218
Asia–Pacific:
Transportation Solutions		764		805
Industrial Solutions		155		163
Communications Solutions		254		252
Total Asia–Pacific		1,173		1,220
Americas:
Transportation Solutions		466		419
Industrial Solutions		423		375
Communications Solutions		114		104
Total Americas		1,003		898
Total	$	3,347	$	3,336

(1)          Net sales to external customers are attributed to individual countries based on the legal entity that records the sale.

        Operating income by segment was as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions	$	332	$	417
Industrial Solutions		100		102
Communications Solutions		52		67
Total	$	484	$	586

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Tyco Electronics Group S.A.

3 Months Ended

Dec. 28, 2018

Tyco Electronics Group S.A.

Tyco Electronics Group S.A.

16. Tyco Electronics Group S.A.

        Tyco Electronics Group S.A. ("TEGSA"), a Luxembourg company and our 100%-owned subsidiary, is a holding company that owns, directly or indirectly, all of our operating subsidiaries. TEGSA is the obligor under our senior notes, commercial paper, and Credit Facility, which are fully and unconditionally guaranteed by its parent, TE Connectivity Ltd. The following tables present condensed consolidating financial information for TE Connectivity Ltd., TEGSA, and all other subsidiaries that are not providing a guarantee of debt but which represent assets of TEGSA, using the equity method of accounting.

Condensed Consolidating Statement of Operations (unaudited)
For the Quarter Ended December 28, 2018

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Net sales	$	—		$	—		$	3,347		$	—		$	3,347
Cost of sales		—			—			2,233			—			2,233
Gross margin		—			—			1,114			—			1,114
Selling, general, and administrative expenses, net(1)		35			(107	)		461			—			389
Research, development, and engineering expenses		—			—			161			—			161
Acquisition and integration costs		—			—			5			—			5
Restructuring and other charges, net		—			—			75			—			75
Operating income (loss)		(35	)		107			412			—			484
Interest income		—			—			5			—			5
Interest expense		—			(27	)		—			—			(27	)
Other expense, net		—			—			(1	)		—			(1	)
Equity in net income of subsidiaries		441			389			—			(830	)		—
Equity in net loss of subsidiaries of discontinued operations		(107	)		(49	)		—			156			—
Intercompany interest income (expense), net		(23	)		(28	)		51			—			—
Income from continuing operations before income taxes		276			392			467			(674	)		461
Income tax expense		—			—			(78	)		—			(78	)
Income from continuing operations		276			392			389			(674	)		383
Loss from discontinued operations, net of income taxes		—			(58	)		(49	)		—			(107	)
Net income		276			334			340			(674	)		276
Other comprehensive income		49			49			35			(84	)		49
Comprehensive income	$	325		$	383		$	375		$	(758	)	$	325

(1)          TEGSA selling, general, and administrative expenses include gains of $110 million related to intercompany transactions. These gains are offset by corresponding losses recorded by other subsidiaries.

Condensed Consolidating Statement of Operations (unaudited)
For the Quarter Ended December 29, 2017

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Net sales	$	—		$	—		$	3,336		$	—		$	3,336
Cost of sales		—			—			2,172			—			2,172
Gross margin		—			—			1,164			—			1,164
Selling, general, and administrative expenses, net		47			(3	)		333			—			377
Research, development, and engineering expenses		—			—			165			—			165
Acquisition and integration costs		—			—			2			—			2
Restructuring and other charges, net		—			—			34			—			34
Operating income (loss)		(47	)		3			630			—			586
Interest income		—			—			4			—			4
Interest expense		—			(26	)		—			—			(26	)
Other income, net		—			—			2			—			2
Equity in net income of subsidiaries		27			22			—			(49	)		—
Equity in net loss of subsidiaries of discontinued operations		(7	)		(7	)		—			14			—
Intercompany interest income (expense), net		(13	)		28			(15	)		—			—
Income (loss) from continuing operations before income taxes		(40	)		20			621			(35	)		566
Income tax expense		—			—			(599	)		—			(599	)
Income (loss) from continuing operations		(40	)		20			22			(35	)		(33	)
Loss from discontinued operations, net of income taxes		—			—			(7	)		—			(7	)
Net income (loss)		(40	)		20			15			(35	)		(40	)
Other comprehensive income		76			76			87			(163	)		76
Comprehensive income	$	36		$	96		$	102		$	(198	)	$	36

Condensed Consolidating Balance Sheet (unaudited)
As of December 28, 2018

	TE Connectivity Ltd.		TEGSA		Other Subsidiaries		Consolidating Adjustments			Total
	(in millions)
Assets
Current assets:
Cash and cash equivalents	$	—	$	—	$	505	$	—		$	505
Accounts receivable, net		—		—		2,380		—			2,380
Inventories		—		—		1,986		—			1,986
Intercompany receivables		51		3,096		60		(3,207	)		—
Prepaid expenses and other current assets		4		68		435		—			507
Total current assets		55		3,164		5,366		(3,207	)		5,378
Property, plant, and equipment, net		—		—		3,550		—			3,550
Goodwill		—		—		5,648		—			5,648
Intangible assets, net		—		—		1,648		—			1,648
Deferred income taxes		—		—		2,580		—			2,580
Investment in subsidiaries		13,557		26,537		—		(40,094	)		—
Intercompany loans receivable		2		1,598		13,646		(15,246	)		—
Other assets		—		1		383		—			384
Total Assets	$	13,614	$	31,300	$	32,821	$	(58,547	)	$	19,188
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	—	$	583	$	2	$	—		$	585
Accounts payable		2		—		1,536		—			1,538
Accrued and other current liabilities		220		53		1,075		—			1,348
Intercompany payables		3,156		—		51		(3,207	)		—
Total current liabilities		3,378		636		2,664		(3,207	)		3,471
Long-term debt		—		3,379		3		—			3,382
Intercompany loans payable		—		13,648		1,598		(15,246	)		—
Long-term pension and postretirement liabilities		—		—		1,101		—			1,101
Deferred income taxes		—		—		207		—			207
Income taxes		—		—		335		—			335
Other liabilities		—		80		376		—			456
Total Liabilities		3,378		17,743		6,284		(18,453	)		8,952
Total Shareholders' Equity		10,236		13,557		26,537		(40,094	)		10,236
Total Liabilities and Shareholders' Equity	$	13,614	$	31,300	$	32,821	$	(58,547	)	$	19,188

Condensed Consolidating Balance Sheet (unaudited)
As of September 28, 2018

	TE Connectivity Ltd.		TEGSA		Other Subsidiaries		Consolidating Adjustments			Total
	(in millions)
Assets
Current assets:
Cash and cash equivalents	$	—	$	—	$	848	$	—		$	848
Accounts receivable, net		—		—		2,361		—			2,361
Inventories		—		—		1,857		—			1,857
Intercompany receivables		37		2,391		48		(2,476	)		—
Prepaid expenses and other current assets		5		112		544		—			661
Current assets held for sale		—		—		472		—			472
Total current assets		42		2,503		6,130		(2,476	)		6,199
Property, plant, and equipment, net		—		—		3,497		—			3,497
Goodwill		—		—		5,684		—			5,684
Intangible assets, net		—		—		1,704		—			1,704
Deferred income taxes		—		—		2,144		—			2,144
Investment in subsidiaries		13,626		26,613		—		(40,239	)		—
Intercompany loans receivable		2		6,535		17,887		(24,424	)		—
Other assets		—		—		1,158		—			1,158
Total Assets	$	13,670	$	35,651	$	38,204	$	(67,139	)	$	20,386
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	—	$	961	$	2	$	—		$	963
Accounts payable		2		—		1,546		—			1,548
Accrued and other current liabilities		400		36		1,275		—			1,711
Intercompany payables		2,437		—		39		(2,476	)		—
Current liabilities held for sale		—		—		188		—			188
Total current liabilities		2,839		997		3,050		(2,476	)		4,410
Long-term debt		—		3,033		4		—			3,037
Intercompany loans payable		—		17,888		6,536		(24,424	)		—
Long-term pension and postretirement liabilities		—		—		1,102		—			1,102
Deferred income taxes		—		—		207		—			207
Income taxes		—		—		312		—			312
Other liabilities		—		107		380		—			487
Total Liabilities		2,839		22,025		11,591		(26,900	)		9,555
Total Shareholders' Equity		10,831		13,626		26,613		(40,239	)		10,831
Total Liabilities and Shareholders' Equity	$	13,670	$	35,651	$	38,204	$	(67,139	)	$	20,386

Condensed Consolidating Statement of Cash Flows (unaudited)
For the Quarter Ended December 28, 2018

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	$	(73	)	$	(9	)	$	410		$	—		$	328
Net cash used in discontinued operating activities		—			—			(31	)		—			(31	)
Net cash provided by (used in) operating activities		(73	)		(9	)		379			—			297
Cash Flows From Investing Activities:
Capital expenditures		—			—			(210	)		—			(210	)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation		—			303			(15	)		—			288
Change in intercompany loans		—			(25	)		—			25			—
Other		—			—			4			—			4
Net cash provided by (used in) continuing investing activities		—			278			(221	)		25			82
Net cash used in discontinued investing activities		—			—			(2	)		—			(2	)
Net cash provided by (used in) investing activities		—			278			(223	)		25			80
Cash Flows From Financing Activities:
Changes in parent company equity(1)		23			(240	)		217			—			—
Net increase in commercial paper		—			63			—			—			63
Proceeds from issuance of debt		—			350			—			—			350
Repayment of debt		—			(441	)		—			—			(441	)
Proceeds from exercise of share options		—			—			7			—			7
Repurchase of common shares		(519	)		—			—			—			(519	)
Payment of common share dividends to shareholders		(150	)		—			—			—			(150	)
Transfer to discontinued operations		—			—			(33	)		—			(33	)
Loan activity with parent		719			—			(694	)		(25	)		—
Other		—			(1	)		(28	)		—			(29	)
Net cash provided by (used in) continuing financing activities		73			(269	)		(531	)		(25	)		(752	)
Net cash provided by discontinued financing activities		—			—			33			—			33
Net cash provided by (used in) financing activities		73			(269	)		(498	)		(25	)		(719	)
Effect of currency translation on cash		—			—			(1	)		—			(1	)
Net decrease in cash, cash equivalents, and restricted cash		—			—			(343	)		—			(343	)
Cash, cash equivalents, and restricted cash at beginning of period		—			—			848			—			848
Cash, cash equivalents, and restricted cash at end of period	$	—		$	—		$	505		$	—		$	505

(1)          Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity.

Condensed Consolidating Statement of Cash Flows (unaudited)
For the Quarter Ended December 29, 2017

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities(1)	$	(51	)	$	(10	)	$	351		$	(7	)	$	283
Net cash provided by discontinued operating activities		—			—			67			—			67
Net cash provided by (used in) operating activities		(51	)		(10	)		418			(7	)		350
Cash Flows From Investing Activities:
Capital expenditures		—			—			(237	)		—			(237	)
Change in intercompany loans		—			335			—			(335	)		—
Intercompany distribution receipts(1)		—			23			—			(23	)		—
Net cash provided by (used in) continuing investing activities		—			358			(237	)		(358	)		(237	)
Net cash used in discontinued investing activities		—			—			(4	)		—			(4	)
Net cash provided by (used in) investing activities		—			358			(241	)		(358	)		(241	)
Cash Flows From Financing Activities:
Changes in parent company equity(2)		30			—			(30	)		—			—
Net increase in commercial paper		—			241			—			—			241
Proceeds from issuance of debt		—			119			—			—			119
Repayment of debt		—			(708	)		—			—			(708	)
Proceeds from exercise of share options		—			—			54			—			54
Repurchase of common shares		(108	)		—			(59	)		—			(167	)
Payment of common share dividends to shareholders		(143	)		—			2			—			(141	)
Transfer from discontinued operations		—			—			63			—			63
Intercompany distributions(1)		—			—			(30	)		30			—
Loan activity with parent		272			—			(607	)		335			—
Other		—			—			(32	)		—			(32	)
Net cash provided by (used in) continuing financing activities		51			(348	)		(639	)		365			(571	)
Net cash used in discontinued financing activities		—			—			(63	)		—			(63	)
Net cash provided by (used in) financing activities		51			(348	)		(702	)		365			(634	)
Effect of currency translation on cash		—			—			11			—			11
Net decrease in cash, cash equivalents, and restricted cash		—			—			(514	)		—			(514	)
Cash, cash equivalents, and restricted cash at beginning of period		—			—			1,218			—			1,218
Cash, cash equivalents, and restricted cash at end of period	$	—		$	—		$	704		$	—		$	704

(1)          During fiscal 2018, other subsidiaries made distributions to TEGSA in the amount of $30 million. Cash flows are presented based upon the nature of the distributions.

(2)          Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity.

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Basis of Presentation and Accounting Policies

3 Months Ended

Dec. 28, 2018

Basis of Presentation and Accounting Policies

Revenue Recognition

Revenue Recognition

        We account for revenue in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers, which introduced a single, comprehensive, five-step revenue recognition model. Our revenues are generated principally from the sale of our products. Revenue is recognized as performance obligations under the terms of a contract, such as a purchase order with a customer, are satisfied; generally this occurs with the transfer of control. We transfer control and recognize revenue when we ship product to our customers, the customers accept and have legal title for the product, and we have a right to payment for such product. Revenue is measured as the amount of consideration that we expect to receive in exchange for those products and excludes taxes assessed by governmental authorities and collected from customers concurrent with the sale of products. Shipping and handling costs are treated as fulfillment costs and are included in cost of sales. Since we typically invoice our customers when we satisfy our performance obligations, we do not have material contract assets or contract liabilities. Our credit terms are customary and do not contain significant financing components that extend beyond one year of fulfillment of performance obligations. We apply the practical expedient of ASC 606 with respect to financing components and do not evaluate contracts in which payment is due within one year of satisfaction of the related performance obligation. Since our performance obligations to deliver products are part of contracts that generally have original durations of one year or less, we have elected to use the optional exemption to not disclose the aggregate amount of transaction prices associated with unsatisfied or partially satisfied performance obligations as of December 28, 2018. See Note 15 for net sales disaggregated by industry end market and geographic region which is summarized by segment and that we consider meaningful to depict the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors.

        We generally warrant that our products will conform to our, or mutually agreed to, specifications and that our products will be free from material defects in materials and workmanship for a limited time. We limit our warranty to the replacement or repair of defective parts, or a refund or credit of the price of the defective product. We do not account for these warranties as separate performance obligations.

        Although products are generally sold at fixed prices, certain distributors and customers receive incentives or awards, such as sales rebates, return allowances, scrap allowances, and other rights, which are accounted for as variable consideration. We estimate these amounts in the same period revenue is recognized based on the expected value to be provided to customers and reduce revenue accordingly. Our estimates of variable consideration and ultimate determination of the estimated amounts to include in the transaction price are based primarily on our assessment of anticipated performance and historical and forecasted information that is reasonably available to us.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

        In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-12, an update to ASC 815, Derivatives and Hedging. The update improves and simplifies hedge accounting and related disclosures. We elected to early adopt this update, which did not have a material impact on our Condensed Consolidated Financial Statements, in the quarter ended December 28, 2018.

        In October 2016, the FASB issued ASU No. 2016-16, an update to ASC 740, Income Taxes. This guidance requires the recognition of the income tax consequences of intra-entity transfers of assets other than inventory in the period in which the transfer occurs. The update was adopted on a modified retrospective basis in the quarter ended December 28, 2018 and resulted in a $443 million cumulative-effect adjustment to beginning accumulated earnings, which represented the net reversal of all balances associated with deferred tax impacts of intra-entity transfers of assets other than inventory. This included a decrease in other assets of $798 million, an increase in deferred tax assets of $418 million, and a decrease in prepaid expenses and other current assets of $63 million on the Condensed Consolidated Balance Sheet.

        In May 2014, the FASB issued ASU No. 2014-09 which codified ASC 606, Revenue from Contracts with Customers. This guidance supersedes ASC 605, Revenue Recognition, and introduces a single, comprehensive, five-step revenue recognition model. ASC 606 also enhances disclosures related to revenue recognition. We adopted ASC 606, as amended, in the quarter ended December 28, 2018 using a modified retrospective approach. Prior period amounts have not been adjusted and continue to be reported under the accounting standards in effect for those periods. Transition impacts, which relate primarily to incentive compensation arrangements, were not material to our results of operations or financial position. Because the impact of adoption was immaterial, we have not recorded a cumulative-effect adjustment to beginning accumulated earnings.

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Restructuring and Other Charges, Net (Tables)

3 Months Ended

Dec. 28, 2018

Restructuring and Other Charges, Net

Net restructuring charges by segment

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions	$	21	$	4
Industrial Solutions		35		22
Communications Solutions		19		8
Restructuring charges, net	$	75	$	34

Summary of activity in restructuring reserves

	Balance at September 28, 2018		Charges		Changes in Estimate			Cash Payments			Non-Cash Items			Currency Translation			Balance at December 28, 2018
	(in millions)
Fiscal 2019 Actions:
Employee severance	$	—	$	67	$	—		$	(4	)	$	—		$	—		$	63
Fiscal 2018 Actions:
Employee severance		114		1		—			(16	)		—			(2	)		97
Facility and other exit costs		4		1		—			(1	)		—			—			4
Property, plant and equipment		—		1		—			—			(1	)		—			—
Total		118		3		—			(17	)		(1	)		(2	)		101
Pre-Fiscal 2018 Actions:
Employee severance		49		4		(1	)		(8	)		—			(1	)		43
Facility and other exit costs		—		1		—			(1	)		—			—			—
Property, plant and equipment		—		1		—			—			(1	)		—			—
Total		49		6		(1	)		(9	)		(1	)		(1	)		43
Total Activity	$	167	$	76	$	(1	)	$	(30	)	$	(2	)	$	(3	)	$	207

Restructuring reserves included on Condensed Consolidated Balance Sheets

	December 28, 2018		September 28, 2018
	(in millions)
Accrued and other current liabilities	$	183	$	141
Other liabilities		24		26
Restructuring reserves	$	207	$	167

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Discontinued Operations (Tables)

3 Months Ended

Dec. 28, 2018

Discontinued Operations

Schedule of components of income (loss) from discontinued operations, net of income taxes and balance sheet information for assets and liabilities held for sale

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Net sales	$	41		$	143
Cost of sales		(50	)		(132	)
Selling, general, and administrative expenses		(4	)		(7	)
Research, development, and engineering expenses		(3	)		(10	)
Restructuring and other charges, net		(3	)		—
Pre-tax loss from discontinued operations		(19	)		(6	)
Pre-tax loss on sale of discontinued operations		(96	)		—
Income tax (expense) benefit		8			(1	)
Loss from discontinued operations, net of income taxes	$	(107	)	$	(7	)

        The following table presents balance sheet information for assets and liabilities held for sale at September 28, 2018; there were no such balances at December 28, 2018:

	September 28, 2018
	(in millions)
Accounts receivable, net	$	72
Inventories		130
Other current assets		32
Property, plant, and equipment, net		221
Other assets		17
Total assets held for sale	$	472
Accounts payable	$	63
Accrued and other current liabilities		26
Deferred revenue		60
Other liabilities		39
Total liabilities held for sale	$	188

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Inventories (Tables)

3 Months Ended

Dec. 28, 2018

Inventories

Schedule of inventories

	December 28, 2018		September 28, 2018
	(in millions)
Raw materials	$	306	$	276
Work in progress		735		656
Finished goods		945		925
Inventories	$	1,986	$	1,857

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Goodwill (Tables)

3 Months Ended

Dec. 28, 2018

Goodwill

Changes in the carrying amount of goodwill by segment

	Transportation Solutions			Industrial Solutions			Communications Solutions			Total
	(in millions)
September 28, 2018(1)	$	1,993		$	3,104		$	587		$	5,684
Currency translation and other		(13	)		(19	)		(4	)		(36	)
December 28, 2018(1)	$	1,980		$	3,085		$	583		$	5,648

(1)          At December 28, 2018 and September 28, 2018, accumulated impairment losses for the Transportation Solutions, Industrial Solutions, and Communications Solutions segments were $2,191 million, $669 million, and $489 million, respectively.

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Intangible Assets, Net (Tables)

3 Months Ended

Dec. 28, 2018

Intangible Assets, Net

Schedule of finite-lived intangible assets

	December 28, 2018							September 28, 2018
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(in millions)
Customer relationships	$	1,457	$	(410	)	$	1,047	$	1,468	$	(389	)	$	1,079
Intellectual property		1,257		(673	)		584		1,261		(653	)		608
Other		34		(17	)		17		33		(16	)		17
Total	$	2,748	$	(1,100	)	$	1,648	$	2,762	$	(1,058	)	$	1,704

Schedule of finite-lived intangible assets, future amortization expense

	(in millions)
Remainder of fiscal 2019	$	136
Fiscal 2020		175
Fiscal 2021		172
Fiscal 2022		172
Fiscal 2023		171
Fiscal 2024		140
Thereafter		682
Total	$	1,648

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Financial Instruments (Tables)

3 Months Ended

Dec. 28, 2018

Cash flow hedges

Schedule of impacts of hedging program

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Gains (losses) recorded in other comprehensive income (loss)	$	19	$	(10	)
Gains (losses) excluded from the hedging relationship(1)		17		(19	)

(1)          Gains and losses excluded from the hedging relationship are recognized prospectively in selling, general, and administrative expenses and are offset by losses and gains generated as a result of re-measuring certain intercompany loans to the U.S. dollar.

Net investment hedges

Schedule of impacts of hedging program

	For the Quarters Ended
	December 28, 2018			December 29, 2017
	(in millions)
Foreign currency exchange gains (losses) on intercompany loans and external borrowings(1)	$	76		$	(66	)
Losses on cross-currency swaps designated as hedge of net investment(2)		(5	)		—

(1)          Foreign currency exchange gains and losses on intercompany loans and external borrowings are recorded as currency translation, a component of accumulated other comprehensive income (loss), and are offset by changes attributable to the translation of the net investment.

(2)          Gains and losses on cross-currency swaps designated as hedge of net investment are recorded as currency translation.

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Retirement Plans (Tables)

3 Months Ended

Dec. 28, 2018

Retirement Plans

Net periodic pension benefit cost

	Non-U.S. Plans						U.S. Plans
	For the Quarters Ended						For the Quarters Ended
	December 28, 2018			December 29, 2017			December 28, 2018			December 29, 2017
	(in millions)
Service cost	$	12		$	12		$	3		$	3
Interest cost		11			10			12			11
Expected return on plan assets		(16	)		(17	)		(14	)		(15	)
Amortization of net actuarial loss		6			6			4			6
Amortization of prior service credit		(2	)		(2	)		—			—
Net periodic pension benefit cost	$	11		$	9		$	5		$	5

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Earnings (Loss) Per Share (Tables)

3 Months Ended

Dec. 28, 2018

Earnings (Loss) Per Share

Schedule of weighted-average shares outstanding, basic and diluted

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Basic		342		352
Dilutive impact of share-based compensation arrangements		2		—
Diluted		344		352

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Shareholders' Equity (Tables)

3 Months Ended

Dec. 28, 2018

Shareholders' Equity

Schedule of common shares repurchased

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Number of common shares repurchased		6		2
Repurchase value	$	495	$	214

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Share Plans (Tables)

3 Months Ended

Dec. 28, 2018

Share Plans

Share-based compensation expense

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Share-based compensation expense	$	23	$	28

Summary of share-based award activity

        During the quarter ended December 28, 2018, we granted the following share-based awards as part of our annual incentive plan grant:

	Shares		Grant-Date Fair Value
	(in millions)
Share options		1.6	$	13.36
Restricted share awards		0.6		76.66
Performance share awards		0.2		76.66

Weighted-average assumptions

Expected share price volatility		20	%
Risk free interest rate		3.0	%
Expected annual dividend per share	$	1.76
Expected life of options (in years)		5.2

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Segment and Geographic Data (Tables)

3 Months Ended

Dec. 28, 2018

Segment and Geographic Data

Schedule of net sales by segment

Net sales by segment(1) and industry end market(2) were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions:
Automotive	$	1,469	$	1,517
Commercial transportation		297		300
Sensors		220		215
Total Transportation Solutions		1,986		2,032
Industrial Solutions:
Industrial equipment		483		471
Aerospace, defense, oil, and gas		285		254
Energy		160		157
Total Industrial Solutions		928		882
Communications Solutions:
Data and devices		257		238
Appliances		176		184
Total Communications Solutions		433		422
Total	$	3,347	$	3,336

(1)          Intersegment sales were not material and were recorded at selling prices that approximated market prices.

(2)          Industry end market information is presented consistently with our internal management reporting and may be revised periodically as management deems necessary.

Schedule of net sales by geographic region and segment

Net sales by geographic region(1) and segment were as follows:

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Europe/Middle East/Africa ("EMEA"):
Transportation Solutions	$	756	$	808
Industrial Solutions		350		344
Communications Solutions		65		66
Total EMEA		1,171		1,218
Asia–Pacific:
Transportation Solutions		764		805
Industrial Solutions		155		163
Communications Solutions		254		252
Total Asia–Pacific		1,173		1,220
Americas:
Transportation Solutions		466		419
Industrial Solutions		423		375
Communications Solutions		114		104
Total Americas		1,003		898
Total	$	3,347	$	3,336

(1)          Net sales to external customers are attributed to individual countries based on the legal entity that records the sale.

Schedule of operating income by segment

	For the Quarters Ended
	December 28, 2018		December 29, 2017
	(in millions)
Transportation Solutions	$	332	$	417
Industrial Solutions		100		102
Communications Solutions		52		67
Total	$	484	$	586

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Tyco Electronics Group S.A. (Tables)

3 Months Ended

Dec. 28, 2018

Tyco Electronics Group S.A.

Condensed Consolidating Statement of Operations

Condensed Consolidating Statement of Operations (unaudited)
For the Quarter Ended December 28, 2018

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Net sales	$	—		$	—		$	3,347		$	—		$	3,347
Cost of sales		—			—			2,233			—			2,233
Gross margin		—			—			1,114			—			1,114
Selling, general, and administrative expenses, net(1)		35			(107	)		461			—			389
Research, development, and engineering expenses		—			—			161			—			161
Acquisition and integration costs		—			—			5			—			5
Restructuring and other charges, net		—			—			75			—			75
Operating income (loss)		(35	)		107			412			—			484
Interest income		—			—			5			—			5
Interest expense		—			(27	)		—			—			(27	)
Other expense, net		—			—			(1	)		—			(1	)
Equity in net income of subsidiaries		441			389			—			(830	)		—
Equity in net loss of subsidiaries of discontinued operations		(107	)		(49	)		—			156			—
Intercompany interest income (expense), net		(23	)		(28	)		51			—			—
Income from continuing operations before income taxes		276			392			467			(674	)		461
Income tax expense		—			—			(78	)		—			(78	)
Income from continuing operations		276			392			389			(674	)		383
Loss from discontinued operations, net of income taxes		—			(58	)		(49	)		—			(107	)
Net income		276			334			340			(674	)		276
Other comprehensive income		49			49			35			(84	)		49
Comprehensive income	$	325		$	383		$	375		$	(758	)	$	325

(1)          TEGSA selling, general, and administrative expenses include gains of $110 million related to intercompany transactions. These gains are offset by corresponding losses recorded by other subsidiaries.

Condensed Consolidating Statement of Operations (unaudited)
For the Quarter Ended December 29, 2017

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Net sales	$	—		$	—		$	3,336		$	—		$	3,336
Cost of sales		—			—			2,172			—			2,172
Gross margin		—			—			1,164			—			1,164
Selling, general, and administrative expenses, net		47			(3	)		333			—			377
Research, development, and engineering expenses		—			—			165			—			165
Acquisition and integration costs		—			—			2			—			2
Restructuring and other charges, net		—			—			34			—			34
Operating income (loss)		(47	)		3			630			—			586
Interest income		—			—			4			—			4
Interest expense		—			(26	)		—			—			(26	)
Other income, net		—			—			2			—			2
Equity in net income of subsidiaries		27			22			—			(49	)		—
Equity in net loss of subsidiaries of discontinued operations		(7	)		(7	)		—			14			—
Intercompany interest income (expense), net		(13	)		28			(15	)		—			—
Income (loss) from continuing operations before income taxes		(40	)		20			621			(35	)		566
Income tax expense		—			—			(599	)		—			(599	)
Income (loss) from continuing operations		(40	)		20			22			(35	)		(33	)
Loss from discontinued operations, net of income taxes		—			—			(7	)		—			(7	)
Net income (loss)		(40	)		20			15			(35	)		(40	)
Other comprehensive income		76			76			87			(163	)		76
Comprehensive income	$	36		$	96		$	102		$	(198	)	$	36

Condensed Consolidating Balance Sheet

Condensed Consolidating Balance Sheet (unaudited)
As of December 28, 2018

	TE Connectivity Ltd.		TEGSA		Other Subsidiaries		Consolidating Adjustments			Total
	(in millions)
Assets
Current assets:
Cash and cash equivalents	$	—	$	—	$	505	$	—		$	505
Accounts receivable, net		—		—		2,380		—			2,380
Inventories		—		—		1,986		—			1,986
Intercompany receivables		51		3,096		60		(3,207	)		—
Prepaid expenses and other current assets		4		68		435		—			507
Total current assets		55		3,164		5,366		(3,207	)		5,378
Property, plant, and equipment, net		—		—		3,550		—			3,550
Goodwill		—		—		5,648		—			5,648
Intangible assets, net		—		—		1,648		—			1,648
Deferred income taxes		—		—		2,580		—			2,580
Investment in subsidiaries		13,557		26,537		—		(40,094	)		—
Intercompany loans receivable		2		1,598		13,646		(15,246	)		—
Other assets		—		1		383		—			384
Total Assets	$	13,614	$	31,300	$	32,821	$	(58,547	)	$	19,188
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	—	$	583	$	2	$	—		$	585
Accounts payable		2		—		1,536		—			1,538
Accrued and other current liabilities		220		53		1,075		—			1,348
Intercompany payables		3,156		—		51		(3,207	)		—
Total current liabilities		3,378		636		2,664		(3,207	)		3,471
Long-term debt		—		3,379		3		—			3,382
Intercompany loans payable		—		13,648		1,598		(15,246	)		—
Long-term pension and postretirement liabilities		—		—		1,101		—			1,101
Deferred income taxes		—		—		207		—			207
Income taxes		—		—		335		—			335
Other liabilities		—		80		376		—			456
Total Liabilities		3,378		17,743		6,284		(18,453	)		8,952
Total Shareholders' Equity		10,236		13,557		26,537		(40,094	)		10,236
Total Liabilities and Shareholders' Equity	$	13,614	$	31,300	$	32,821	$	(58,547	)	$	19,188

Condensed Consolidating Balance Sheet (unaudited)
As of September 28, 2018

	TE Connectivity Ltd.		TEGSA		Other Subsidiaries		Consolidating Adjustments			Total
	(in millions)
Assets
Current assets:
Cash and cash equivalents	$	—	$	—	$	848	$	—		$	848
Accounts receivable, net		—		—		2,361		—			2,361
Inventories		—		—		1,857		—			1,857
Intercompany receivables		37		2,391		48		(2,476	)		—
Prepaid expenses and other current assets		5		112		544		—			661
Current assets held for sale		—		—		472		—			472
Total current assets		42		2,503		6,130		(2,476	)		6,199
Property, plant, and equipment, net		—		—		3,497		—			3,497
Goodwill		—		—		5,684		—			5,684
Intangible assets, net		—		—		1,704		—			1,704
Deferred income taxes		—		—		2,144		—			2,144
Investment in subsidiaries		13,626		26,613		—		(40,239	)		—
Intercompany loans receivable		2		6,535		17,887		(24,424	)		—
Other assets		—		—		1,158		—			1,158
Total Assets	$	13,670	$	35,651	$	38,204	$	(67,139	)	$	20,386
Liabilities and Shareholders' Equity
Current liabilities:
Short-term debt	$	—	$	961	$	2	$	—		$	963
Accounts payable		2		—		1,546		—			1,548
Accrued and other current liabilities		400		36		1,275		—			1,711
Intercompany payables		2,437		—		39		(2,476	)		—
Current liabilities held for sale		—		—		188		—			188
Total current liabilities		2,839		997		3,050		(2,476	)		4,410
Long-term debt		—		3,033		4		—			3,037
Intercompany loans payable		—		17,888		6,536		(24,424	)		—
Long-term pension and postretirement liabilities		—		—		1,102		—			1,102
Deferred income taxes		—		—		207		—			207
Income taxes		—		—		312		—			312
Other liabilities		—		107		380		—			487
Total Liabilities		2,839		22,025		11,591		(26,900	)		9,555
Total Shareholders' Equity		10,831		13,626		26,613		(40,239	)		10,831
Total Liabilities and Shareholders' Equity	$	13,670	$	35,651	$	38,204	$	(67,139	)	$	20,386

Condensed Consolidating Statement of Cash Flows

Condensed Consolidating Statement of Cash Flows (unaudited)
For the Quarter Ended December 28, 2018

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	$	(73	)	$	(9	)	$	410		$	—		$	328
Net cash used in discontinued operating activities		—			—			(31	)		—			(31	)
Net cash provided by (used in) operating activities		(73	)		(9	)		379			—			297
Cash Flows From Investing Activities:
Capital expenditures		—			—			(210	)		—			(210	)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation		—			303			(15	)		—			288
Change in intercompany loans		—			(25	)		—			25			—
Other		—			—			4			—			4
Net cash provided by (used in) continuing investing activities		—			278			(221	)		25			82
Net cash used in discontinued investing activities		—			—			(2	)		—			(2	)
Net cash provided by (used in) investing activities		—			278			(223	)		25			80
Cash Flows From Financing Activities:
Changes in parent company equity(1)		23			(240	)		217			—			—
Net increase in commercial paper		—			63			—			—			63
Proceeds from issuance of debt		—			350			—			—			350
Repayment of debt		—			(441	)		—			—			(441	)
Proceeds from exercise of share options		—			—			7			—			7
Repurchase of common shares		(519	)		—			—			—			(519	)
Payment of common share dividends to shareholders		(150	)		—			—			—			(150	)
Transfer to discontinued operations		—			—			(33	)		—			(33	)
Loan activity with parent		719			—			(694	)		(25	)		—
Other		—			(1	)		(28	)		—			(29	)
Net cash provided by (used in) continuing financing activities		73			(269	)		(531	)		(25	)		(752	)
Net cash provided by discontinued financing activities		—			—			33			—			33
Net cash provided by (used in) financing activities		73			(269	)		(498	)		(25	)		(719	)
Effect of currency translation on cash		—			—			(1	)		—			(1	)
Net decrease in cash, cash equivalents, and restricted cash		—			—			(343	)		—			(343	)
Cash, cash equivalents, and restricted cash at beginning of period		—			—			848			—			848
Cash, cash equivalents, and restricted cash at end of period	$	—		$	—		$	505		$	—		$	505

(1)          Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity.

Condensed Consolidating Statement of Cash Flows (unaudited)
For the Quarter Ended December 29, 2017

	TE Connectivity Ltd.			TEGSA			Other Subsidiaries			Consolidating Adjustments			Total
	(in millions)
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities(1)	$	(51	)	$	(10	)	$	351		$	(7	)	$	283
Net cash provided by discontinued operating activities		—			—			67			—			67
Net cash provided by (used in) operating activities		(51	)		(10	)		418			(7	)		350
Cash Flows From Investing Activities:
Capital expenditures		—			—			(237	)		—			(237	)
Change in intercompany loans		—			335			—			(335	)		—
Intercompany distribution receipts(1)		—			23			—			(23	)		—
Net cash provided by (used in) continuing investing activities		—			358			(237	)		(358	)		(237	)
Net cash used in discontinued investing activities		—			—			(4	)		—			(4	)
Net cash provided by (used in) investing activities		—			358			(241	)		(358	)		(241	)
Cash Flows From Financing Activities:
Changes in parent company equity(2)		30			—			(30	)		—			—
Net increase in commercial paper		—			241			—			—			241
Proceeds from issuance of debt		—			119			—			—			119
Repayment of debt		—			(708	)		—			—			(708	)
Proceeds from exercise of share options		—			—			54			—			54
Repurchase of common shares		(108	)		—			(59	)		—			(167	)
Payment of common share dividends to shareholders		(143	)		—			2			—			(141	)
Transfer from discontinued operations		—			—			63			—			63
Intercompany distributions(1)		—			—			(30	)		30			—
Loan activity with parent		272			—			(607	)		335			—
Other		—			—			(32	)		—			(32	)
Net cash provided by (used in) continuing financing activities		51			(348	)		(639	)		365			(571	)
Net cash used in discontinued financing activities		—			—			(63	)		—			(63	)
Net cash provided by (used in) financing activities		51			(348	)		(702	)		365			(634	)
Effect of currency translation on cash		—			—			11			—			11
Net decrease in cash, cash equivalents, and restricted cash		—			—			(514	)		—			(514	)
Cash, cash equivalents, and restricted cash at beginning of period		—			—			1,218			—			1,218
Cash, cash equivalents, and restricted cash at end of period	$	—		$	—		$	704		$	—		$	704

(1)          During fiscal 2018, other subsidiaries made distributions to TEGSA in the amount of $30 million. Cash flows are presented based upon the nature of the distributions.

(2)          Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity.

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Basis of Presentation and Accounting Policies (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Sep. 28, 2018
Revenue Recognition
Practical expedient with respect to financing components	true
Optional exemption not to disclose aggregate amount of transaction prices associated with unsatisfied or partially satisfied performance obligations	true
Recently Adopted Accounting Pronouncements
Other assets	$ 384	$ 1,158
Deferred tax assets	2,580	2,144
Prepaid expenses and other current assets	507	$ 661
ASU 2016-16
Recently Adopted Accounting Pronouncements
Cumulative-effect adjustment	443
Other assets	(798)
Deferred tax assets	418
Prepaid expenses and other current assets	$ (63)

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Restructuring and Other Charges, Net (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Restructuring and other charges, net
Restructuring charges, net	$ 75	$ 34
Transportation Solutions
Restructuring and other charges, net
Restructuring charges, net	21	4
Industrial Solutions
Restructuring and other charges, net
Restructuring charges, net	35	22
Communications Solutions
Restructuring and other charges, net
Restructuring charges, net	$ 19	$ 8

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Restructuring and Other Charges, Net - Restructuring Reserve Activity (Details) $ in Millions	3 Months Ended
	Dec. 28, 2018 USD ($)
Restructuring reserve
Restructuring reserve at the beginning of the period	$ 167
Charges	76
Changes in Estimate	(1)
Cash Payments	(30)
Non-Cash Items	(2)
Currency Translation	(3)
Restructuring reserve at the end of the period	207
Fiscal 2019 Actions | Employee severance
Restructuring reserve
Charges	67
Cash Payments	(4)
Restructuring reserve at the end of the period	63
Fiscal 2018 Actions
Restructuring reserve
Restructuring reserve at the beginning of the period	118
Charges	3
Cash Payments	(17)
Non-Cash Items	(1)
Currency Translation	(2)
Restructuring reserve at the end of the period	101
Fiscal 2018 Actions | Employee severance
Restructuring reserve
Restructuring reserve at the beginning of the period	114
Charges	1
Cash Payments	(16)
Currency Translation	(2)
Restructuring reserve at the end of the period	97
Fiscal 2018 Actions | Facility and other exit costs
Restructuring reserve
Restructuring reserve at the beginning of the period	4
Charges	1
Cash Payments	(1)
Restructuring reserve at the end of the period	4
Fiscal 2018 Actions | Property, plant, and equipment
Restructuring reserve
Charges	1
Non-Cash Items	(1)
Pre-Fiscal 2018 Actions
Restructuring reserve
Restructuring reserve at the beginning of the period	49
Charges	6
Changes in Estimate	(1)
Cash Payments	(9)
Non-Cash Items	(1)
Currency Translation	(1)
Restructuring reserve at the end of the period	43
Pre-Fiscal 2018 Actions | Employee severance
Restructuring reserve
Restructuring reserve at the beginning of the period	49
Charges	4
Changes in Estimate	(1)
Cash Payments	(8)
Currency Translation	(1)
Restructuring reserve at the end of the period	43
Pre-Fiscal 2018 Actions | Facility and other exit costs
Restructuring reserve
Charges	1
Cash Payments	(1)
Pre-Fiscal 2018 Actions | Property, plant, and equipment
Restructuring reserve
Charges	1
Non-Cash Items	$ (1)

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Restructuring and Other Charges, Net - Actions (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Restructuring Charges
Charges Incurred	$ 75	$ 34
Fiscal 2019 Actions
Restructuring Charges
Charges Incurred	67
Additional Expected Charges	10
Fiscal 2018 Actions
Restructuring Charges
Charges Incurred	3	22
Additional Expected Charges	10
Pre-Fiscal 2018 Actions
Restructuring Charges
Charges Incurred	$ 5	$ 12

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Restructuring and Other Charges, Net - Restructuring Reserve Balances (Details) - USD ($) $ in Millions	Dec. 28, 2018	Sep. 28, 2018
Restructuring reserves included on the Condensed Consolidated Balance Sheets
Accrued and other current liabilities	$ 183	$ 141
Other liabilities	24	26
Restructuring reserves	$ 207	$ 167

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Discontinued Operations - Subsea (Details) $ in Millions	3 Months Ended
	Dec. 28, 2018 USD ($)
Discontinued Operations
Net cash proceeds	$ 288
Pre tax loss on sale	(96)
Discontinued Operations, Disposed of by Sale | Subsea Communications
Discontinued Operations
Net cash proceeds	288
Pre tax loss on sale	(96)
Cumulative translation adjustment losses	67
Existing guarantees value	$ 1,700
Maximum remaining term for majority of existing guarantees	2 years
Fair value of existing guarantees	$ 12
New performance guarantee issued	70
Discontinued Operations, Disposed of by Sale | Subsea Communications | Maximum
Discontinued Operations
New performance guarantees issuable amount	$ 300
Period for issuance of new performance guarantees	3 years

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Discontinued Operations - Summary Information (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017	Sep. 28, 2018
Income (loss) from discontinued operations, net of income taxes
Net sales	$ 41	$ 143
Cost of sales	(50)	(132)
Selling, general, and administrative expenses	(4)	(7)
Research, development, and engineering expenses	(3)	(10)
Restructuring and other charges, net	(3)
Pre-tax loss from discontinued operations	(19)	(6)
Pre-tax loss on sale of discontinued operations	(96)
Income tax (expense) benefit	8	(1)
Loss from discontinued operations, net of income taxes	$ (107)	$ (7)
Balance sheet information for assets and liabilities held for sale
Accounts receivable, net			$ 72
Inventories			130
Other current assets			32
Property, plant, and equipment, net			221
Other assets			17
Total assets held for sale			472
Accounts payable			63
Accrued and other current liabilities			26
Deferred revenue			60
Other liabilities			39
Total liabilities held for sale			$ 188

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Inventories (Details) - USD ($) $ in Millions	Dec. 28, 2018	Sep. 28, 2018
Inventories
Raw materials	$ 306	$ 276
Work in progress	735	656
Finished goods	945	925
Inventories	$ 1,986	$ 1,857

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Goodwill (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Sep. 28, 2018
Goodwill:
Goodwill, beginning balance	$ 5,684
Currency translation and other	(36)
Goodwill, ending balance	5,648
Transportation Solutions
Goodwill:
Goodwill, beginning balance	1,993
Currency translation and other	(13)
Goodwill, ending balance	1,980
Accumulated impairment losses	2,191	$ 2,191
Industrial Solutions
Goodwill:
Goodwill, beginning balance	3,104
Currency translation and other	(19)
Goodwill, ending balance	3,085
Accumulated impairment losses	669	669
Communications Solutions
Goodwill:
Goodwill, beginning balance	587
Currency translation and other	(4)
Goodwill, ending balance	583
Accumulated impairment losses	$ 489	$ 489

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Intangible Assets, Net (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017	Sep. 28, 2018
Finite-Lived Intangible Assets
Gross Carrying Amount	$ 2,748		$ 2,762
Accumulated Amortization	(1,100)		(1,058)
Net Carrying Amount	1,648		1,704
Finite-lived intangible assets, amortization expense	45	$ 45
Aggregate amortization expense on intangible assets
Remainder of fiscal 2019	136
Fiscal 2020	175
Fiscal 2021	172
Fiscal 2022	172
Fiscal 2023	171
Fiscal 2024	140
Thereafter	682
Customer relationships
Finite-Lived Intangible Assets
Gross Carrying Amount	1,457		1,468
Accumulated Amortization	(410)		(389)
Net Carrying Amount	1,047		1,079
Intellectual property
Finite-Lived Intangible Assets
Gross Carrying Amount	1,257		1,261
Accumulated Amortization	(673)		(653)
Net Carrying Amount	584		608
Other
Finite-Lived Intangible Assets
Gross Carrying Amount	34		33
Accumulated Amortization	(17)		(16)
Net Carrying Amount	$ 17		$ 17

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Debt (Details) - USD ($) $ in Millions	1 Months Ended		3 Months Ended
	Dec. 31, 2018	Nov. 30, 2018	Dec. 28, 2018	Dec. 29, 2017	Sep. 28, 2018
Debt
Ownership percentage in TEGSA			100.00%
Repayments of debt			$ 441	$ 708
Fair value of debt			$ 4,091		$ 4,149
Senior floating rate notes due June 2020
Debt
Debt instrument principal amount		$ 350
Senior floating rate notes due June 2020 | LIBOR
Debt
Debt instrument description of variable rate basis		three-month London Interbank Offered Rate
Debt instrument basis spread on variable rate (as a percent)		0.45%
2.375% senior notes due 2018
Debt
Repayments of debt	$ 325
Debt instrument, interest rate (as a percent)	2.375%
Five-year credit facility
Debt
Revolving credit facility term			5 years
Maximum borrowing capacity			$ 1,500
Incremental borrowing capacity			500
Borrowings under the Credit Facility			0		0
Commercial paper
Debt
Total principal debt			$ 333		$ 270
Weighted-average interest rate (as a percent)			2.94%		2.35%

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Commitments and Contingencies (Details) $ in Millions	Dec. 28, 2018 USD ($)
Loss Contingencies
Accrual environmental loss contingency, estimate of probable loss	$ 17
Minimum
Loss Contingencies
Accrual environmental loss contingency, estimate of probable loss	15
Maximum
Loss Contingencies
Accrual environmental loss contingency, estimate of probable loss	44
Outstanding Letters of Credit, Letters of Guarantee and Surety Bonds
Guarantees and Product Warranties
Guarantor obligations, maximum exposure	$ 286

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Financial Instruments (Details) € in Millions, $ in Millions	3 Months Ended		12 Months Ended
	Dec. 28, 2018 USD ($)	Dec. 29, 2017 USD ($)	Sep. 28, 2018 USD ($)	Sep. 25, 2015 EUR (€)
Cash flow hedges | Cross-currency swap contracts
Financial Instruments
Notional amount | €				€ 1,000
Interest paid in foreign currency, fixed interest rate				3.50%
Interest received in U.S. dollars, weighted-average fixed interest rate				5.33%
Fair Value of Liability Positions	$ 64		$ 100
Gains (losses) recorded in other comprehensive income (loss)	19	$ (10)
Gains (losses) excluded from the hedging relationship	17	(19)
Net investment hedges | Intercompany loans and external borrowings
Financial Instruments
Notional amount of non derivative instruments	3,189		$ 4,064
Foreign currency exchange gains (losses)	76	$ (66)
Net investment hedges | Cross-currency swap contracts
Financial Instruments
Notional amount	$ 952
Interest paid in foreign currency, fixed interest rate	0.00%
Interest received in U.S. dollars, weighted-average fixed interest rate	3.06%
Foreign currency exchange gains (losses)	$ (5)

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Retirement Plans (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Non-U.S. Plans
Defined Benefit Plan, Net Periodic Pension Benefit Cost
Service cost	$ 12	$ 12
Interest cost	11	10
Expected return on plan assets	(16)	(17)
Amortization of net actuarial loss	6	6
Amortization of prior service credit	(2)	(2)
Net periodic pension benefit cost	11	9
U.S. Plans
Defined Benefit Plan, Net Periodic Pension Benefit Cost
Service cost	3	3
Interest cost	12	11
Expected return on plan assets	(14)	(15)
Amortization of net actuarial loss	4	6
Net periodic pension benefit cost	$ 5	$ 5

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Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017	Sep. 28, 2018
Income Taxes
Income tax expense	$ 78	$ 599
Income tax expense related to tax impacts of Tax Cuts and Jobs Act		567
Net income tax benefit related to certain legal entity restructurings		$ 61
U.S. federal corporate income tax rate		21.00%
Income tax benefit related to the reduction in the valuation allowance recorded against certain U.S. federal tax credit carryforwards		$ 34
Accrued interest and penalties related to uncertain tax positions	63		$ 60
Unrecognized income tax benefits, approximate amount that could be resolved in next twelve months	$ 125
Liabilities sharing percent, entity	31.00%
Liabilities sharing percent, Tyco International	27.00%
Liabilities sharing percent, Covidien	42.00%

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Earnings (Loss) Per Share (Details) - shares shares in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Earnings (Loss) Per Share
Basic (in shares)	342	352
Dilutive impact of share-based compensation arrangements (in shares)	2
Diluted (in shares)	344	352
Share options
Antidilutive shares excluded from computation of earnings per share
Antidilutive share options	1	1
Nonvested share awards and options, antidilutive due to loss in period
Antidilutive shares excluded from computation of earnings per share
Antidilutive share options		3

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Shareholders' Equity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017	Sep. 29, 2017
Shareholders' Equity
Cash dividend paid (in dollars per share)	$ 0.44	$ 0.40
Unpaid portion of the dividend payment recorded in accrued and other current liabilities	$ 149		$ 303
Share repurchase program, increase in authorized amount	$ 1,500
Number of common shares repurchased	6	2
Repurchase value	$ 495	$ 214
Amount available for repurchase, at end of period	$ 2,000

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Share Plans (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Share Based Compensation Arrangements:
Share-based compensation expense	$ 23	$ 28
Shares available for issuance	17.0
Share Based Compensation Expenses Not Recognized
Share-based compensation, share-based awards, total compensation expense not yet recognized	$ 179
Share-based compensation, share-based awards, total compensation expense not yet recognized, expected period for recognition	2 years 3 months 18 days
Share options
Share Based Compensation Arrangements:
Share options granted	1.6
Options granted, grant-date fair value (in dollars per share)	$ 13.36
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology
Expected share price volatility (as a percent)	20.00%
Risk free interest rate (as a percent)	3.00%
Expected annual dividend per share	$ 1.76
Expected life of options (in years)	5 years 2 months 12 days
Restricted share awards
Share Based Compensation Arrangements:
Shares granted	0.6
Shares granted, grant-date fair value (in dollars per share)	$ 76.66
Performance share awards
Share Based Compensation Arrangements:
Shares granted	0.2
Shares granted, grant-date fair value (in dollars per share)	$ 76.66

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Segment and Geographic Data - Net Sales by Segment and Industry End Market (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Segment and Geographic Data
Net Sales	$ 3,347	$ 3,336
Transportation Solutions
Segment and Geographic Data
Net Sales	1,986	2,032
Transportation Solutions | Automotive
Segment and Geographic Data
Net Sales	1,469	1,517
Transportation Solutions | Commercial transportation
Segment and Geographic Data
Net Sales	297	300
Transportation Solutions | Sensors
Segment and Geographic Data
Net Sales	220	215
Industrial Solutions
Segment and Geographic Data
Net Sales	928	882
Industrial Solutions | Industrial equipment
Segment and Geographic Data
Net Sales	483	471
Industrial Solutions | Aerospace, defense, oil, and gas
Segment and Geographic Data
Net Sales	285	254
Industrial Solutions | Energy
Segment and Geographic Data
Net Sales	160	157
Communications Solutions
Segment and Geographic Data
Net Sales	433	422
Communications Solutions | Data and devices
Segment and Geographic Data
Net Sales	257	238
Communications Solutions | Appliances
Segment and Geographic Data
Net Sales	$ 176	$ 184

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Segment and Geographic Data - Net Sales by Geographic Region and Segment (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Segment and Geographic Data
Net Sales	$ 3,347	$ 3,336
Transportation Solutions
Segment and Geographic Data
Net Sales	1,986	2,032
Industrial Solutions
Segment and Geographic Data
Net Sales	928	882
Communications Solutions
Segment and Geographic Data
Net Sales	433	422
EMEA
Segment and Geographic Data
Net Sales	1,171	1,218
EMEA | Transportation Solutions
Segment and Geographic Data
Net Sales	756	808
EMEA | Industrial Solutions
Segment and Geographic Data
Net Sales	350	344
EMEA | Communications Solutions
Segment and Geographic Data
Net Sales	65	66
Asia-Pacific
Segment and Geographic Data
Net Sales	1,173	1,220
Asia-Pacific | Transportation Solutions
Segment and Geographic Data
Net Sales	764	805
Asia-Pacific | Industrial Solutions
Segment and Geographic Data
Net Sales	155	163
Asia-Pacific | Communications Solutions
Segment and Geographic Data
Net Sales	254	252
Americas
Segment and Geographic Data
Net Sales	1,003	898
Americas | Transportation Solutions
Segment and Geographic Data
Net Sales	466	419
Americas | Industrial Solutions
Segment and Geographic Data
Net Sales	423	375
Americas | Communications Solutions
Segment and Geographic Data
Net Sales	$ 114	$ 104

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Segment and Geographic Data - Operating Income by Segment (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Segment and Geographic Data
Operating income	$ 484	$ 586
Transportation Solutions
Segment and Geographic Data
Operating income	332	417
Industrial Solutions
Segment and Geographic Data
Operating income	100	102
Communications Solutions
Segment and Geographic Data
Operating income	$ 52	$ 67

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Tyco Electronics Group S.A. - Operations (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Tyco Electronics Group S.A.
Ownership percentage in TEGSA	100.00%
Statement of Operations Detail:
Net sales	$ 3,347	$ 3,336
Cost of sales	2,233	2,172
Gross margin	1,114	1,164
Selling, general, and administrative expenses, net	389	377
Research, development, and engineering expenses	161	165
Acquisition and integration costs	5	2
Restructuring and other charges, net	75	34
Operating income	484	586
Interest income	5	4
Interest expense	(27)	(26)
Other income (expense), net	(1)	2
Income from continuing operations before income taxes	461	566
Income tax expense	(78)	(599)
Income (loss) from continuing operations	383	(33)
Loss from discontinued operations, net of income taxes	(107)	(7)
Net income (loss)	276	(40)
Other comprehensive income	49	76
Comprehensive income	325	36
Consolidating Adjustments
Statement of Operations Detail:
Equity in net income of subsidiaries	(830)	(49)
Equity in net loss of subsidiaries of discontinued operations	156	14
Income from continuing operations before income taxes	(674)	(35)
Income (loss) from continuing operations	(674)	(35)
Net income (loss)	(674)	(35)
Other comprehensive income	(84)	(163)
Comprehensive income	(758)	(198)
TE Connectivity Ltd. | Consolidating Reportable entities
Statement of Operations Detail:
Selling, general, and administrative expenses, net	35	47
Operating income	(35)	(47)
Equity in net income of subsidiaries	441	27
Equity in net loss of subsidiaries of discontinued operations	(107)	(7)
Intercompany interest income (expense), net	(23)	(13)
Income from continuing operations before income taxes	276	(40)
Income (loss) from continuing operations	276	(40)
Net income (loss)	276	(40)
Other comprehensive income	49	76
Comprehensive income	325	36
TEGSA | Consolidating Reportable entities
Statement of Operations Detail:
Selling, general, and administrative expenses, net	(107)	(3)
Operating income	107	3
Interest expense	(27)	(26)
Equity in net income of subsidiaries	389	22
Equity in net loss of subsidiaries of discontinued operations	(49)	(7)
Intercompany interest income (expense), net	(28)	28
Income from continuing operations before income taxes	392	20
Income (loss) from continuing operations	392	20
Loss from discontinued operations, net of income taxes	(58)
Net income (loss)	334	20
Other comprehensive income	49	76
Comprehensive income	383	96
Intercompany transaction gains	110
Other Subsidiaries | Consolidating Reportable entities
Statement of Operations Detail:
Net sales	3,347	3,336
Cost of sales	2,233	2,172
Gross margin	1,114	1,164
Selling, general, and administrative expenses, net	461	333
Research, development, and engineering expenses	161	165
Acquisition and integration costs	5	2
Restructuring and other charges, net	75	34
Operating income	412	630
Interest income	5	4
Other income (expense), net	(1)	2
Intercompany interest income (expense), net	51	(15)
Income from continuing operations before income taxes	467	621
Income tax expense	(78)	(599)
Income (loss) from continuing operations	389	22
Loss from discontinued operations, net of income taxes	(49)	(7)
Net income (loss)	340	15
Other comprehensive income	35	87
Comprehensive income	$ 375	$ 102

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Tyco Electronics Group S.A. - Balance Sheet (Details) - USD ($) $ in Millions	Dec. 28, 2018	Sep. 28, 2018	Dec. 29, 2017	Sep. 29, 2017
Current assets:
Cash and cash equivalents	$ 505	$ 848	$ 704	$ 1,218
Accounts receivable, net	2,380	2,361
Inventories	1,986	1,857
Prepaid expenses and other current assets	507	661
Current assets held for sale		472
Total current assets	5,378	6,199
Property, plant, and equipment, net	3,550	3,497
Goodwill	5,648	5,684
Intangible assets, net	1,648	1,704
Deferred income taxes	2,580	2,144
Other assets	384	1,158
Total Assets	19,188	20,386
Current liabilities:
Short-term debt	585	963
Accounts payable	1,538	1,548
Accrued and other current liabilities	1,348	1,711
Current liabilities held for sale		188
Total current liabilities	3,471	4,410
Long-term debt	3,382	3,037
Long-term pension and postretirement liabilities	1,101	1,102
Deferred income taxes	207	207
Income taxes	335	312
Other liabilities	456	487
Total Liabilities	8,952	9,555
Total Shareholders' Equity	10,236	10,831	9,631	9,751
Total Liabilities and Shareholders' Equity	19,188	20,386
Consolidating Adjustments
Current assets:
Intercompany receivables	(3,207)	(2,476)
Total current assets	(3,207)	(2,476)
Investment in subsidiaries	(40,094)	(40,239)
Intercompany loans receivable	(15,246)	(24,424)
Total Assets	(58,547)	(67,139)
Current liabilities:
Intercompany payables	(3,207)	(2,476)
Total current liabilities	(3,207)	(2,476)
Intercompany loans payable	(15,246)	(24,424)
Total Liabilities	(18,453)	(26,900)
Total Shareholders' Equity	(40,094)	(40,239)
Total Liabilities and Shareholders' Equity	(58,547)	(67,139)
TE Connectivity Ltd. | Consolidating Reportable entities
Current assets:
Intercompany receivables	51	37
Prepaid expenses and other current assets	4	5
Total current assets	55	42
Investment in subsidiaries	13,557	13,626
Intercompany loans receivable	2	2
Total Assets	13,614	13,670
Current liabilities:
Accounts payable	2	2
Accrued and other current liabilities	220	400
Intercompany payables	3,156	2,437
Total current liabilities	3,378	2,839
Total Liabilities	3,378	2,839
Total Shareholders' Equity	10,236	10,831
Total Liabilities and Shareholders' Equity	13,614	13,670
TEGSA | Consolidating Reportable entities
Current assets:
Intercompany receivables	3,096	2,391
Prepaid expenses and other current assets	68	112
Total current assets	3,164	2,503
Investment in subsidiaries	26,537	26,613
Intercompany loans receivable	1,598	6,535
Other assets	1
Total Assets	31,300	35,651
Current liabilities:
Short-term debt	583	961
Accrued and other current liabilities	53	36
Total current liabilities	636	997
Long-term debt	3,379	3,033
Intercompany loans payable	13,648	17,888
Other liabilities	80	107
Total Liabilities	17,743	22,025
Total Shareholders' Equity	13,557	13,626
Total Liabilities and Shareholders' Equity	31,300	35,651
Other Subsidiaries | Consolidating Reportable entities
Current assets:
Cash and cash equivalents	505	848	$ 704	$ 1,218
Accounts receivable, net	2,380	2,361
Inventories	1,986	1,857
Intercompany receivables	60	48
Prepaid expenses and other current assets	435	544
Current assets held for sale		472
Total current assets	5,366	6,130
Property, plant, and equipment, net	3,550	3,497
Goodwill	5,648	5,684
Intangible assets, net	1,648	1,704
Deferred income taxes	2,580	2,144
Intercompany loans receivable	13,646	17,887
Other assets	383	1,158
Total Assets	32,821	38,204
Current liabilities:
Short-term debt	2	2
Accounts payable	1,536	1,546
Accrued and other current liabilities	1,075	1,275
Intercompany payables	51	39
Current liabilities held for sale		188
Total current liabilities	2,664	3,050
Long-term debt	3	4
Intercompany loans payable	1,598	6,536
Long-term pension and postretirement liabilities	1,101	1,102
Deferred income taxes	207	207
Income taxes	335	312
Other liabilities	376	380
Total Liabilities	6,284	11,591
Total Shareholders' Equity	26,537	26,613
Total Liabilities and Shareholders' Equity	$ 32,821	$ 38,204

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Tyco Electronics Group S.A. - Cash Flows (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 28, 2018	Dec. 29, 2017
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	$ 328	$ 283
Net cash provided by (used in) discontinued operating activities	(31)	67
Net cash provided by operating activities	297	350
Cash Flows From Investing Activities:
Capital expenditures	(210)	(237)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation	288
Other	4
Net cash provided by (used in) continued investing activities	82	(237)
Net cash used in discontinued investing activities	(2)	(4)
Net cash provided by (used in) investing activities	80	(241)
Cash Flows From Financing Activities:
Net increase in commercial paper	63	241
Proceeds from issuance of debt	350	119
Repayment of debt	(441)	(708)
Proceeds from exercise of share options	7	54
Repurchase of common shares	(519)	(167)
Payment of common share dividends to shareholders	(150)	(141)
Transfers (to) from discontinued operations	(33)	63
Other	(29)	(32)
Net cash used in continuing financing activities	(752)	(571)
Net cash provided by (used in) discontinued financing activities	33	(63)
Net cash used in financing activities	(719)	(634)
Effect of currency translation on cash	(1)	11
Net decrease in cash, cash equivalents, and restricted cash	(343)	(514)
Cash, cash equivalents, and restricted cash at beginning of period	848	1,218
Cash, cash equivalents, and restricted cash at end of period	505	704
Consolidating Adjustments
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities		(7)
Net cash provided by operating activities		(7)
Cash Flows From Investing Activities:
Change in intercompany loans	25	(335)
Intercompany distribution receipts		(23)
Net cash provided by (used in) continued investing activities	25	(358)
Net cash provided by (used in) investing activities	25	(358)
Cash Flows From Financing Activities:
Intercompany distributions		30
Loan activity with parent	(25)	335
Net cash used in continuing financing activities	(25)	365
Net cash used in financing activities	(25)	365
TE Connectivity Ltd. | Consolidating Reportable entities
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	(73)	(51)
Net cash provided by operating activities	(73)	(51)
Cash Flows From Financing Activities:
Changes in parent company equity	23	30
Repurchase of common shares	(519)	(108)
Payment of common share dividends to shareholders	(150)	(143)
Loan activity with parent	719	272
Net cash used in continuing financing activities	73	51
Net cash used in financing activities	73	51
TEGSA | Consolidating Reportable entities
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	(9)	(10)
Net cash provided by operating activities	(9)	(10)
Cash Flows From Investing Activities:
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation	303
Change in intercompany loans	(25)	335
Intercompany distribution receipts		23
Net cash provided by (used in) continued investing activities	278	358
Net cash provided by (used in) investing activities	278	358
Cash Flows From Financing Activities:
Changes in parent company equity	(240)
Net increase in commercial paper	63	241
Proceeds from issuance of debt	350	119
Repayment of debt	(441)	(708)
Other	(1)
Net cash used in continuing financing activities	(269)	(348)
Net cash used in financing activities	(269)	(348)
Other Subsidiaries | Consolidating Reportable entities
Cash Flows From Operating Activities:
Net cash provided by (used in) continuing operating activities	410	351
Net cash provided by (used in) discontinued operating activities	(31)	67
Net cash provided by operating activities	379	418
Cash Flows From Investing Activities:
Capital expenditures	(210)	(237)
Proceeds from divestiture of discontinued operation, net of cash retained by sold operation	(15)
Other	4
Net cash provided by (used in) continued investing activities	(221)	(237)
Net cash used in discontinued investing activities	(2)	(4)
Net cash provided by (used in) investing activities	(223)	(241)
Cash Flows From Financing Activities:
Changes in parent company equity	217	(30)
Proceeds from exercise of share options	7	54
Repurchase of common shares		(59)
Payment of common share dividends to shareholders		2
Transfers (to) from discontinued operations	(33)	63
Intercompany distributions		(30)
Loan activity with parent	(694)	(607)
Other	(28)	(32)
Net cash used in continuing financing activities	(531)	(639)
Net cash provided by (used in) discontinued financing activities	33	(63)
Net cash used in financing activities	(498)	(702)
Effect of currency translation on cash	(1)	11
Net decrease in cash, cash equivalents, and restricted cash	(343)	(514)
Cash, cash equivalents, and restricted cash at beginning of period	848	1,218
Cash, cash equivalents, and restricted cash at end of period	$ 505	$ 704