Earnings Call Transcript - APH Q1 2026

Operator, Operator

Hello, and welcome to the First Quarter 2026 Earnings Conference Call for Amphenol Corporation. Operator instructions were given. At the request of the company, today's conference is being recorded. If anyone has any objections, you may disconnect at this time. I would now like to introduce today's conference host, Mr. Craig Lampo. Sir, you may begin.

Craig Lampo, CFO

Thank you very much. Good afternoon, everyone. This is Craig Lampo, Amphenol's CFO, and I'm here together with Adam Norwitt, our CEO. We would like to welcome you to our first quarter 2026 conference call. Our first quarter results were released this morning, and I will provide some financial commentary, and then Adam will give an overview of the business and current market trends, and then, of course, we'll take your questions. As a reminder, during the call, we may refer to certain non-GAAP financial measures and make certain forward-looking statements so please refer to the relevant disclosures in our press release for further information. The company closed the first quarter of 2026 with record sales of $7.6 billion and GAAP and adjusted diluted EPS of $0.72 and $1.06, respectively. First quarter sales were up 58% in U.S. dollars, 57% in local currencies, and 33% organically compared to the first quarter of 2025. Sequentially, sales were up 18% in U.S. dollars and in local currencies and up 4% organically. Adam will comment further on trends by market in a few minutes. Orders in the quarter were a record $9.435 billion, up a strong 78% compared to the first quarter of 2025 and up 12% sequentially, resulting in another very strong book-to-bill ratio of 1.24:1. This impressive book-to-bill was driven by robust bookings in all of our end markets with every end market having a positive book-to-bill this quarter. GAAP operating income was $1.8 billion in the quarter and GAAP operating margin was 24%. GAAP operating margin included $249 million of acquisition-related costs primarily related to the acquisition of CommScope, which closed at the beginning of January. These acquisition-related costs included $179 million of noncash amortization related to the value of acquired backlog and inventory step-up costs as well as a $70 million charge related to external transaction costs. Excluding acquisition-related costs, adjusted operating income and adjusted operating margin were $2.1 billion and 27.3%, respectively. On an adjusted basis, operating margin increased by a strong 380 basis points from the prior year quarter and was down 20 basis points sequentially. The year-over-year increase in adjusted operating margin was primarily driven by robust operating leverage on the significantly higher sales volumes, which more than offset the dilutive impact of acquisitions. On a sequential basis, the decrease in adjusted operating margin was primarily driven by the dilutive impact of acquisition, partially offset by robust operating leverage on the higher organic sales volumes. I'm very proud of the company's operating margin performance in the first quarter, which reflects continued strong execution by our team. Breaking down the first quarter results by segment compared to the first quarter of 2025, sales in the Communications Solutions segment were $4.5 billion and increased by 88% in U.S. dollars and 47% organically and segment operating margin was 30.6%. Sales in the Harsh Environment Solutions segment were $1.7 billion and increased by 34% in U.S. dollars and 23% organically and segment operating margin was 28%. Sales in the Interconnect and Sensor Systems segment were $1.4 billion and increased by 23% in U.S. dollars and 17% organically as segment operating margin was 20.2%. The company's GAAP effective tax rate for the first quarter was 42.7%, and the adjusted effective tax rate was 27%, which compared to 22.7% and 24.5% in the first quarter of 2025, respectively. As the typical practice, our adjusted tax rate excludes the tax effect of acquisition-related costs and the excess tax benefit from stock option compensation as well as other discrete tax items. Specifically, the first quarter includes a $130 million tax accrual related to the previously disclosed tax matter in China. The company recently received unfavorable tax determinations from certain relevant tax authorities in China, and this accrual, together with the $100 million accrual the company booked in the fourth quarter of 2025, covers the full amount of the tax payment notices received. In addition, as a result of this matter together with the continued shift in income to higher tax jurisdictions amidst the company's high levels of growth, the company increased its effective tax rate to 27% in the first quarter and expects that rate to remain for the remainder of 2026. The recent developments with respect to the China tax matter also resulted in the company reassessing certain tax-related assumptions applied to prior period results not subject to the China tax inquiries. This reassessment resulted in an adjustment to our tax provision of $160 million, which is recorded in the first quarter. The $130 million accrual together with the $160 million additional tax provision have been excluded from the company's first quarter 2026 adjusted tax rate and adjusted diluted EPS. GAAP diluted EPS was $0.72 in the first quarter, up 24% compared to the prior year period. And on an adjusted basis, diluted EPS was a record $1.06 and increased by 68% compared to $0.63 in the first quarter of 2025. This was an outstanding result. Operating cash flow in the first quarter was $1.1 billion or 120% of net income and free cash flow was $831 million or 89% of net income. These were strong results for first quarter, which typically has somewhat softer cash generation. We continue to expect strong cash flow generation in 2026 with free cash flow conversion remaining within our typical range over time. From a working capital standpoint, inventory days, days sales outstanding and payable days were all within a normal range. During the quarter, the company repurchased 1.3 million shares of common stock at an average price of approximately $140. And when combined with our normal quarterly dividend, total capital returned to shareholders in the first quarter of 2026 was approximately $485 million. Total debt at March 31 was $18.7 billion, and net debt was $14.2 billion. Total liquidity at the end of the quarter was $7.6 billion, which included cash and short-term investments on hand of $4.6 billion plus availability under our existing credit facilities. As previously noted, we expect quarterly interest expense net of interest income to be approximately $200 million for the remainder of 2026. First quarter 2026 EBITDA was $2.3 billion and our net leverage ratio was 1.6x at the end of the first quarter. We are very pleased with the company's financial position. I will now turn the call over to Adam, who will provide some commentary on current market trends.

Adam Norwitt, CEO

Well, thank you very much, Craig, and I hope it's not too late to extend my welcome to all of you on the call today from a beautiful spring day here in Wallingford, Connecticut. As Craig mentioned, I'm going to highlight some of our achievements in the quarter with our very strong start here to the year in 2026. I'll talk about our trends across our served markets. Then I'll comment on our outlook for the second quarter. And of course, we'll have time for questions at the end. Our organization, the Amphenol organization, drove outstanding performance here in the first quarter. Our results were stronger than expected, exceeding the high end of guidance in sales and adjusted diluted earnings per share. Our sales grew from prior year by 58% in U.S. dollars, 57% in local currency, reaching a new record of $7.6 billion. On an organic basis, our sales increased by a very strong 33% with growth across nearly all of our served markets, and I'll talk about those markets here in a few moments. The company booked a record $9.4 billion in orders in the first quarter and that represented a robust book-to-bill of 1.24:1. Orders grew by a very strong 78% from prior year and were up 12% sequentially. I'm very pleased that our order growth in the quarter was broad-based with all of our end markets realizing book-to-bill of at least one, and this was driven in particular by strength in IT datacom, defense, commercial air and industrial. We're also pleased to have delivered adjusted operating margins of 27.3% in the quarter, an increase of 380 basis points from prior year and down just 20 basis points sequentially. These impressive results were achieved despite the margin dilutive impact of the CommScope acquisition in the quarter. I would add that we're very pleased with the CommScope acquisition, and we do expect the business' performance to continue to improve as part of the Amphenol family. Adjusted diluted EPS grew 68% from prior year and reached a new record of $1.06. And finally, as Craig mentioned, the company generated operating cash flow of $1.1 billion and free cash flow of $831 million in the quarter, both clear reflections of the quality of the company's earnings. I can't express enough how proud I am of our team here in this very strong start to 2026. Our results this quarter reaffirm the value of the drive, discipline and agility of our entrepreneurial organization as we continue to perform well amidst a very dynamic environment. Now turning to our served markets. I'm pleased that the company's end market exposure remains diversified, balanced and broad. This diversification continues to create great value for Amphenol, enabling us to participate across all areas of the global electronics industry, while not being disproportionately exposed to the volatility of any given application or market. There is no doubt that the extraordinary investments being made in artificial intelligence, or AI, coupled with our team's outstanding work capturing a significant share of this unique interconnect opportunity has resulted in the IT datacom market in the quarter representing just over 40% of our sales. Nevertheless, we remain committed to continuing to broaden our portfolio across markets, customers, applications and products as we build on the company's momentum and further strengthen Amphenol's position across all areas of the global electronics industry. The defense market in the quarter represented 8% of our sales, and sales grew from prior year by a strong 44% in U.S. dollars and 25% organically. This is driven by broad-based growth across virtually all segments of the defense market and all of our served geographies. Sequentially, sales grew by 2%, which was in line with our expectations coming into the quarter. As we look into the second quarter, we expect sales in the defense markets to increase in the high single-digit range sequentially. We remain encouraged by the company's leading position in the defense interconnect market, where we continue to offer the industry's widest range of high-technology products. Amidst the current dynamic geopolitical environment, countries around the world are increasing their investments in both current and next-generation defense technologies. With our expanded product offerings, both in discrete connectors as well as value-add interconnect, and the significant capacity expansions we've made in recent years, we're positioned to capitalize on this long-term demand trend. The commercial air market represented 4% of our sales in the quarter, and sales in this market increased by 22% in U.S. dollars and 20% organically from prior year, driven by broad-based strength across commercial aircraft manufacturers. Sequentially, our sales moderated by 3% from the fourth quarter, which was better than our expectations coming into the quarter. As we look to the second quarter, we expect a slight further sequential moderation in sales. Our team working in the commercial air market has expanded our product offering, both organically and through acquisitions, which continues to pay real dividends. We look forward to further capitalizing on our expanded range of product solutions for the commercial air market long into the future. The industrial market represented 20% of our sales in the quarter, and our sales to industrial increased by 52% in U.S. dollars and 16% organically as we continue to see accelerating demand across most segments of the diversified industrial market. Virtually all of those areas of the industrial market that we service grew organically in the quarter, and we also saw organic growth in all three major geographies. On a sequential basis, our sales were up 29% from the fourth quarter as we benefited from the addition of CommScope's building connectivity business. Organically, sales were up a strong 6% from the fourth quarter, better than our expectations as we entered the quarter. Looking into Q2, we expect sales in the industrial market to increase in the high single digits from these already strong first quarter levels. We remain encouraged by the company's strength across many diversified segments of the important industrial market. With the addition of CommScope, we're now seeing new opportunities for growth in the building connectivity market. Over the long term, I'm confident in our strategy to expand our high-technology interconnect, antenna and sensor offerings, both organically and through continued complementary acquisitions. This strategy has enabled Amphenol to capitalize on the many electronic revolutions that continue to occur across the diversified industrial market, creating continued opportunities for our team working in this important space. The automotive market represented 11% of our sales in the quarter. Sales in automotive grew by 7% in U.S. dollars and 2% organically, as organic growth in North America and Europe was partially offset by softer sales in Asia. Sequentially, our sales declined by 7% from the fourth quarter, which was a bit better than our expectations coming into the quarter. For Q2, we expect sales to increase modestly from these first quarter levels. Our team in the global automotive market continues to drive new design wins with customers who are increasing the content of electronics in next-generation vehicles, and we look forward to benefiting from our strengthened position in the automotive market for many years to come. The communications networks market represented 12% of our sales in the quarter, and sales in this market grew from prior year by 91% in U.S. dollars driven by the additions of ANDREW and CommScope. On an organic basis, our sales were flat from prior year as growth in wireless applications was offset by moderations in broadband demand. Sequentially, our sales in the quarter grew by 57% from the fourth quarter, driven by the addition of CommScope. On an organic basis, sales were flat to the prior quarter, which was better than our expectations. As we look into the second quarter, we expect sales to remain at these first quarter levels. With our expanded range of technology offerings following the acquisitions of both CommScope and ANDREW, we are well positioned with both service provider and OEM customers across the communications networks market. Our deep and broad range of products, coupled with our global manufacturing footprint, have positioned us to support customers around the world. As the accelerating volume of data traffic drives demand for expanded and upgraded networks in the future, we look forward to enabling these systems for many years to come. The mobile devices market represented 4% of our sales in the quarter, and sales in this market grew by 2% in U.S. dollars and 1% organically from prior year as growth in laptops and accessories was somewhat offset by moderating demand in handsets and wearables. On a sequential basis, our sales declined by 22% from the fourth quarter, which was a better-than-expected decline compared to what we had anticipated. Looking into the second quarter, we expect a modest sales decline from these levels on typical seasonal patterns. Our team working in the mobile devices market has shown the agility and reactivity that has enabled us to outperform expectations in the quarter. We're well positioned for the long term with our leading array of antennas, interconnect products and mechanisms designed into a broad range of next-generation mobile devices. The IT datacom market represented 41% of sales in the first quarter. Sales in this market grew by 99% in U.S. dollars and 81% organically, driven by continued acceleration in demand for our products used in AI applications, together with continued strong growth in our base IT datacom business. On a sequential basis, our sales increased by 27% from the fourth quarter, substantially better than our expectation for a low double-digit increase. On an organic basis, our sequential growth reached 16%, and virtually all of this organic sequential sales growth was driven by growth in AI-related products. Looking ahead, we expect a further sequential sales increase in Q2 in the low teens as investments in AI data centers accelerate and enterprise and cloud customers continue to expand their demand for traditional IT datacom products. We're more encouraged than ever by the company's position in the global IT datacom market. Our team has done an outstanding job securing future business on next-generation IT systems with a very broad array of customers and executing on these programs. The revolution in AI continues to create a unique opportunity for Amphenol, given our leading high-speed and power interconnect products. Now with the addition of CommScope, we have the industry's broadest range of high-speed copper, power and fiber optics interconnect products, all of which are critical components in these next-generation systems and in the next-generation architectures of our customers. This creates a continued long-term growth opportunity for Amphenol. Turning to our outlook and assuming current market conditions as well as constant exchange rates, for the second quarter, we expect sales in the range of $8.1 billion to $8.2 billion and adjusted diluted EPS in the range of $1.14 to $1.16. This would represent strong sales and EPS growth of 43% to 45% and 41% to 43%, respectively, compared to the second quarter of prior year. I remain confident in the ability of our management team to adapt to the many opportunities and challenges in the current environment and to continue to grow Amphenol's market position while driving sustainable and strong profitability for the long term. Finally, I want to thank our entire global team for their outstanding efforts in this very special first quarter. In particular, I want to express my gratitude to the folks working in our factories around the world. This growth doesn't come easy, and the people working in our factories continue to amaze me and delight our customers with their extraordinary hard work. With that, operator, I'd be happy to take any questions that there may be.

Operator, Operator

We have a question from Mark Delaney with Goldman Sachs.

Mark Delaney, Analyst

Congratulations on the strong results. I appreciate that Amphenol is able to address data center customer needs, both for copper and optics, especially post the CommScope acquisition, and that's certainly apparent with the orders and revenue you reported for the IT datacom segment. However, I'm hoping, Adam, you can help investors better understand implications for Amphenol as co-packaged optics (CPO) plays a bigger role over the next 2 to 4 years. Specifically, as Amphenol is engaged with customers on designs that will utilize CPO, what does that mean for Amphenol's revenue and profit potential on a directional basis relative to current designs, especially now that you have CCS?

Adam Norwitt, CEO

Thanks so much, Mark. I appreciate the question. We now have the broadest range of products for customers in the IT datacom market. That starts with high-speed products, continues with power products, and now, with CommScope together with our existing capabilities in optics, we have a very broad suite of optical products, capacities and capabilities. We are working with all players up and down the stack of the AI ecosystem—from those spending the money and outfitting data centers to systems manufacturers and chip makers—on current and future generations. Specifically regarding CPO and the potential evolution toward higher speeds and optical solutions, we are working with customers on a broad array of solutions, including CPO, which creates long-term opportunities for Amphenol. Customers are trying to achieve higher bandwidth, lower latency, higher density and higher transfer speeds so AI systems can operate more effectively. From what we hear, customers are not talking about either/or solutions; they are talking about needing more interconnect overall. As we approach them with a broader suite of products and with proven execution capability, we expect to have a very strong seat at the table. The quantum of the business as architectures evolve remains to be seen, but our proven ability to execute and the breadth of our offerings put Amphenol in a very strong position for the future. There will be ups and downs in the cadence of AI investments, but we believe the long-term prospects for this industry and for Amphenol's position are very strong.

Operator, Operator

We have a question from Andrew Buscaglia with BNP Paribas.

Andrew Buscaglia, Analyst

I wanted to hear a little more about what these customers, the hyperscalers, are saying to you intra-quarter and as the year progresses. Do you think you should see continued acceleration of growth in that segment as you have presumably increased share or content in future generations? And then maybe project out to 2027 or so and talk about what you think the implications are of your fiber portfolio on the next generation.

Adam Norwitt, CEO

I'm going to be careful not to give guidance beyond the quarter, but we have had very strong orders, including in IT datacom. We had strong IT datacom orders in Q1 and also strong orders in the fourth quarter. We have good momentum across the board, including in IT datacom. When we talk to customers focused on next-generation AI build-outs, they want more product, and our team's ability to satisfy that has been an asset. Regarding 2027, I won't prognosticate specifically, but CommScope's performance in the first quarter was largely similar to the organic growth we had across Amphenol, which is impressive. CommScope is a diversified business across data center, communications networks and industrial and is performing very strongly. CommScope opens up a complementary part of the data center opportunity—connecting from rack to rack and across the data center and between data centers through the networks. That is exciting and makes us more important to our customers because once the signal is in the building, we help move it around and create AI architectures. CommScope puts us in a very strong position going forward, and we can help customers make trade-offs with expertise and breadth that is unique in this industry.

Operator, Operator

We have a question from Amit Daryanani.

Amit Daryanani, Analyst

Really impressive set of numbers here. Adam, one of the things we're starting to see a lot in the AI ecosystem is hyperscalers are engaging in long-term capacity expansion plans with suppliers to ensure they can get the capacity they need across the tech stack. As you look at the unprecedented growth you're seeing in IT datacom, how do you think about funding the capacity for these ramps as you go forward? Are Amphenol and CommScope being approached for these multiyear capacity agreements? How do you view them and would they ever make sense for Amphenol?

Adam Norwitt, CEO

Thank you, Amit. We pride ourselves on agility and the ability to react quickly to our customers. Generally, customers can rely on us whether or not they give us long-term agreements. That said, we have made more meaningful investments, and our capital spending has increased as our sales run rate has grown substantially. We work with customers when we make these investments to ensure security around those investments, which can mean customers participating in investments or opening their order apertures, giving us confidence to make capacity increases and massive automation investments for ultra-high-precision products. There's more of that going on today than in the past. You probably won't hear us talk about it very explicitly, but we are working hand-in-hand in partnership with our customers as they enable AI.

Operator, Operator

We have a question from Joe Spak with UBS.

Joseph Spak, Analyst

As the entire value chain for data centers expands and matures, how are you thinking about customers wanting to bring in new players to diversify risk? How does your relationship change there? I know you're in there helping them design, and sometimes that leads to licensing opportunities. Does that meaningfully change your profit opportunity as the ecosystem expands?

Adam Norwitt, CEO

We have always worked in markets where customers want to mitigate risk, and that is no different here. We are not a sole source in any respect, but we are uniquely able to execute and we have unique technology that creates value. We welcome other participants in the market and often partner with them, and sometimes we have licensing agreements. Ultimately, our ability to execute is what customers value along with technology. Over the last three years we've built extraordinary capabilities to support customers, and we convert profitability into cash that we reinvest into product development, capability development and capacity. That allows us to be more important to customers and meet ramp-up demands. We welcome more participants because more participants can mitigate volatility, and that's how this industry has worked for a long time.

Operator, Operator

We have a question from Samik Chatterjee with JPMorgan.

Samik Chatterjee, Analyst

Adam, if I can ask specifically about CCS. You sounded positive on demand. When you announced the acquisition, you assumed mid-teens growth for this year. How are you seeing demand relative to those early milestones? Are you seeing any supply constraints when it comes to bare fiber or preform that could affect your ability to meet customer demand for the CCS business?

Adam Norwitt, CEO

When we announced the deal, we talked about roughly a $3.5 billion to $3.6 billion business with mid-teens growth expectations. In the first quarter, CommScope achieved growth largely at the same pace as Amphenol's organic growth, which is impressive and outperforms what we might have thought when we signed the deal. We continue to expect the company to deliver this year roughly $4.1 billion in sales and $0.15 of accretion. The CommScope team has shown great performance and entrepreneurial drive in meeting customer demand. There is a lot of demand for fiber right now globally, and our team is supporting customer demand and managing market dynamics. They are now part of a company with a different balance sheet and approach to growth, and we are willing to support their growth with investments as we always have at Amphenol.

Operator, Operator

We have a question from William Stein with Truist Securities.

William Stein, Analyst

Congrats on the great results and outlook. My question: it's not just co-package optics we hear about in the AI data center supply chain. There are trade-offs between passive copper, active copper, pluggables, near-package optics, silicon photonics, co-package optics, optical interposers and different use in scale-up versus scale-out. Should we think of Amphenol as having similar ability to succeed in all of those technologies, or are there certain ones where your opportunity will be more limited or could accelerate?

Adam Norwitt, CEO

We have a broad array of active and passive product offerings in both copper and optics. We have developed active capability in copper and, through acquisitions, in optics as well. When I discuss the breadth of products, it includes high-speed copper, power, passive optics, active copper and active optics. We do not have every single part number in the universe, but we have capabilities across those categories. No single company that I can think of has the breadth to help customers across all these choices as they face a smorgasbord of options. While not every product will have the same impact to our company, more interconnect and more connections will be required, which benefits the whole industry. It's up to us to execute and take more than our fair share, and so far we have been able to do that. Also, there will likely be many architectures and a range of customer approaches, reinforcing the importance of offering a broad portfolio.

Operator, Operator

We have a question from Asiya Merchant with Citigroup.

Asiya Merchant, Analyst

Great results. There's been a lot of talk about component and energy inflation. You delivered very strong margins here. Could you talk about pricing ability to pass through those costs? Was there increased ability to raise prices here relative to historical? And on the book-to-bill and orders and lead times—very strong book-to-bill again similar to last quarter—are we seeing extended lead times? Help us understand what's driving the book-to-bill.

Craig Lampo, CFO

Thanks, Asiya. I'll take the first part and let Adam comment on book-to-bill. We're very happy with margins in the quarter, 27.3%, slightly under record levels in the second half of last year. That includes CommScope, which had a great quarter but is margin dilutive as we expected. Over time, we expect to get them closer to the company average. This 27.3% was an outstanding result given some pressures. The improvement resulted from execution on strong growth and cost discipline in our factories and with vendors. Pricing is ultimately a function of the value we bring to customers with technology and execution, and we've been able to offset costs like tariffs and inflation through factory productivity, vendor management and pricing where appropriate. Our general managers make the pricing decisions relative to each business, which drives the margin performance you see. We expect strong margins going forward as reflected in our guidance.

Adam Norwitt, CEO

On book-to-bill, I wouldn't tell you we see anything categorical, with the one proviso that some customers, because of investments we're making, have opened up their order apertures. We've talked about that for a number of quarters. I wouldn't characterize it as a broad extension of lead times.

Operator, Operator

We have a question from Steven Fox with Fox Advisors.

Steven Fox, Analyst

Adam, could you talk about commercial buildings? You highlighted that with CommScope now being part of Amphenol and you also mentioned antennas and sensors. How do you see the 1 plus 1 equals 3 dynamic between Amphenol and CommScope as you include commercial buildings in your portfolio?

Adam Norwitt, CEO

The building connectivity business is exciting and complementary and new to Amphenol. CommScope has a leading position and a unique channel with distributors in over 150 countries. Any place where buildings are built, they need connectivity to enable next-generation functionality. With CommScope's position and channel, there are other interconnect products—antennas and sensors—where we have strength and where we now have an open door into a market that can create long-term value. We're excited to get to know this market better, forge strategic distribution relationships across Amphenol, and take advantage of the revolutions happening in smart buildings, residential, commercial, factories and related markets.

Operator, Operator

We have a question from Wamsi Mohan with Bank of America.

Wamsi Mohan, Analyst

Amphenol works with the leading GPU player on design for scale-up connectivity and has earned leading market share in copper-based scale-up. As the transition to optical continues, and given there are more players and a later start in some parts of the CommScope portfolio, how are you thinking about share and the competitive landscape and the potential to achieve similar share in scale-up optical solutions over time?

Adam Norwitt, CEO

We are not the only player in copper or high-speed copper interconnect, but we've executed in a way that has led to taking more than our fair share. If architectures evolve into optics or hybrid solutions, we'll have competition as well, and it may be the same competitors or different ones. We've always had healthy competition and must earn business continuously. Our team will go out and work to earn business in optics just as it has on copper.

Operator, Operator

We have a question from Scott Graham with Seaport Research Partners.

Scott Graham, Analyst

Congratulations on another great quarter. I wanted to ask about industrial, where organic was plus 16%. In the past, Adam has unbundled pieces of that. Can you delineate which end markets within industrial led and perhaps one or two markets where organic was less than the 16%?

Adam Norwitt, CEO

Industrial has been on great momentum and accelerated with 16% organic growth. The vast majority of internal industrial subsegments grew organically year-over-year. Strongest performance came from instrumentation, electrification, oil and gas, lighting, medical, heavy equipment and factory automation—all strong double-digit organic growth. We saw modestly less performance in marine and similar segments, but even the "Other" category in industrial, which covers a wide range of harsh environment applications, grew strongly in double digits. It's very broad-based adoption of electronics in harsh environments across many applications.

Operator, Operator

We have a question from Luke Junk with Baird.

Luke Junk, Analyst

We're seeing what looks like a once-in-a-generation supply chain restocking event in both the U.S. and Israeli defense industry. Can you help us understand Amphenol's leverage within your defense electronics platform, especially thinking of interceptors, munitions and items exposed to the supply chain dynamic?

Adam Norwitt, CEO

I hope the current ceasefire in the Middle East holds. We continue to monitor and support our employees in the Middle East. The world is not a safer place today than it was 5 to 10 years ago, and there's increased focus on missile defense and smart munitions. We saw this in the Ukraine war and the continued geopolitical dynamic. Countries around the world are planning and executing significant upgrades in military spending, especially on next-generation technologies. We have positioned ourselves as a leader in defense interconnect, expanding the scope of that position through acquisitions like Trexon and by broadening our RF, active and passive capabilities. We have invested in products, capabilities and capacity to meet customer demand. When defense budgets ramp up, we sit in a unique position with breadth of products and capacity to meet demand. Our team treats defense work seriously because lives depend on it, and we've grown the business substantially with significant technological and qualification requirements. We are proud of our defense business and believe this could be a long-term structural shift in demand dynamics where we are well positioned.

Operator, Operator

We have a question from Joe Giordano with TD Cowen.

Joseph Giordano, Analyst

I know we won't get into specific numbers, but people are trying to understand new architectures in data centers and rack-level changes as you move to higher voltages and the interplay between ASPs you can charge versus pounds of wire or lengths of cabling. Can you speak generally about how to think about these trade-offs and how to get to a net view?

Adam Norwitt, CEO

I won't give spreadsheet-level metrics on pounds or lengths, but there will be new architectures and higher voltages. Our team is enabling next-generation systems that need new energy solutions. We talk about data for AI data centers, but power is also central. We offer a broad array of power interconnects from discrete connectors to complex power cable assemblies, bus bars and liquid-cooled bus bars. As customers shift to higher power capacities inside racks and data centers, Amphenol aims to be the core partner. We'll continue to see opportunities across power and data, but I can't provide a specific pound-and-length metric.

Operator, Operator

That concludes our Q&A session. I will hand back to Mr. Norwitt for closing remarks.

Adam Norwitt, CEO

Thank you all very much. We truly appreciate everybody's interest in the company today, and we look forward to talking to you all here in 90 days. I hope you all have a wonderful spring and start to your summer. Thanks so much.

Operator, Operator

This concludes today's call. Thank you for joining. You may now disconnect your lines.