Amphenol Corporation (NYSE: APH) experienced a considerable decline in its stock price on Wednesday after releasing its financial results for the fourth quarter and full year of 2025. The company showcased strong operational performance, with both sales and adjusted earnings surpassing market expectations, but investor sentiment appeared impacted negatively in trading following the announcement.
For the fourth quarter, Amphenol recorded revenue of $6.43 billion, marking a 49% increase compared to the same period last year when measured in U.S. dollars, and a 37% rise on an organic basis. These figures exceeded the consensus estimate of $6.18 billion held by analysts. Adjusted diluted earnings per share (EPS) reached 97 cents, up 76% from the prior year quarter, again outperforming the anticipated 93 cents. Alongside the impressive top and bottom line growth, Amphenol posted an adjusted operating margin of 27.5% during this period, demonstrating robust profitability.
At the conclusion of the quarter, the company maintained a substantial cash position, holding $11.13 billion in cash and cash equivalents. In terms of shareholder returns, Amphenol repurchased 1.3 million shares of common stock during the quarter, totaling $171 million in expenditures. Furthermore, the company distributed $202 million in dividends. Across 2025, total capital returned to shareholders neared $1.5 billion, reflecting a strong commitment to delivering shareholder value.
President and Chief Executive Officer R. Adam Norwitt highlighted the broad-based nature of the company’s sales growth, stating, "Sales in the fourth quarter and for the full year increased from the prior year by 49% and 52%, respectively. This growth was driven by strong organic expansion in nearly all end markets, particularly exceptional performance in the IT datacom sector, supplemented by contributions from our acquisition program." Norwitt also emphasized the company's sustained profitability, noting adjusted operating margins of 27.5% for the quarter and 26.2% for the full year.
Looking ahead, Amphenol provided guidance for the first quarter of 2026, forecasting sales between $6.90 billion and $7.00 billion. This projected figure represents a year-over-year increase ranging from 43% to 45%. Adjusted diluted EPS guidance is set between 91 cents and 93 cents, translating to a 44% to 48% growth compared to the first quarter of the previous year. The outlook includes an estimated $900 million contribution in sales and 2 cents accretion in adjusted diluted EPS from the CCS business.
In response to the earnings release and forward guidance, industry analyst Samik Chatterjee from JP Morgan maintained an Overweight rating on Amphenol shares and revised the price target upward from $160 to $185, signaling confidence in the company’s growth prospects.
Despite these positive results and outlook, Amphenol shares declined sharply during Wednesday’s trading session. According to Benzinga Pro data, the stock was down 14.78% at $141.66 by the time of publication. This drop contrasted the upbeat financial performance and guidance presented by the company.
Amid investor focus on growth sectors, some analysts suggest looking beyond the traditional market leaders in technology. The cyclical momentum in AI and related industries is prompting investors to consider alternative equities positioned to benefit from the next wave of innovation. However, these broader market dynamics may have influenced sentiment around Amphenol’s stock on the day of their earnings disclosure.
Overall, Amphenol's quarterly and yearly results indicated substantial expansion in sales and profitability fueled by organic growth in core markets and augmented by acquisitions. The firm’s large cash reserves and active capital return policy underline a strategic approach to shareholder engagement. The forthcoming quarter's sales and earnings guidance reinforce optimism for continued performance improvement heading into 2026.