(Reuters) – Electronic components maker Amphenol forecast fourth-quarter revenue below market estimates on Wednesday, as its clients across industries cut spending in the face of high borrowing costs.
Telecom providers, one of Amphenol’s biggest customers, have cut orders for communications equipment after a rush to build out their 5G networks over the past two years.
Demand for its automotive products including antennas, engine management systems and sensing systems have also suffered as automakers cut production targets and clamp down on spending, hit by labor strikes and sluggish demand.
Shares of the Connecticut-based company fell 3% in premarket trading after Amphenol said it expects fourth-quarter sales to be between $3.09 billion and $3.15 billion, below analysts’ average estimate of $3.17 billion, according to LSEG data.
The communications solutions business, which produces fiber optic products and antennas, saw a decline of nearly 16% in third-quarter net sales to $1.28 billion.
Overall revenue fell 3% to $3.20 billion. But it was higher than estimates of $3.10 billion. Strong demand for its radar systems and circuit boards, among others, boosted Amphenol’s revenue.
Third-quarter adjusted earnings of 78 cents per share also beat estimates of 74 cents.
Amphenol forecast adjusted earnings between 75 cents and 77 cents per share for the fourth quarter, in line with estimates of 76 cents per share.
(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Shinjini Ganguli)
