TE Connectivity Ltd. TEL reported second-quarter fiscal 2016 adjusted earnings per share from continuing operations of 90 cents, which beat the Zacks Consensus Estimate by a penny. However, on a year-over-year basis, the bottom line declined 1.1%.The dismal year-over-year earnings results were largely a result of lackluster top-line performance, especially on account of weakness in industrial-related markets.Inside the HeadlinesNet sales in the fiscal second quarter fell 4.2% year over year to $2,952 million. It also fell short of the Zacks Consensus Estimate of $2,978 million.Poor sales across all the three reporting segments of the company resulted in the top-line decline. Prolonged softness in industrial markets coupled with unfavorable macroeconomic conditions like slowdown in China added to the company’s woes. Segmental PerformanceTransportation Solutions revenues came in at $1,608 million in the quarter, relatively flat on a year-over-year basis. Orders in the transportation segment stood at $ 1,550 million compared with the year-ago tally of $1653 million. Though automotive organic sales growth in China and EMEA regions acted as tailwinds, weakness in industrial markets offset these improvements.Communications Solutions revenues fell 10.2% year over year to $606 million. However, orders at this segment increased 20.7% to $513 million on a year-over-year basis. The lackluster performance of the communications business was largely on account of poor sales in Appliances and Data & Devices business lines. While inventory corrections in NA Distribution channel and lower production in Asia hampered Appliances sales, Data & Devices were impacted by distribution inventory corrections and product exits.Industrial Solutions continued to show weakness, with revenues declining 7.4% year over year to $738 million in the quarter. Orders in this quarter declined 7.7% to $764 million. The dip in sales at this segment was largely a result of defense-related distribution softness that adversely impacted Aerospace & Defense sales. Moreover, economic slowdown in China and prolonged weakness in oil & gas markets hurt the sales.The company’s adjusted operating margin for the quarter fell 150 basis points to 14.9% from the year-ago quarter.Liquidity & Cash FlowTE Connectivity exited the quarter with cash and cash equivalents of $1,150 million, down from $3,329 million as on Sep 25, 2015.The company generated free cash flow of $165 million in the quarter as against $217 million in the prior-year quarter.Share Repurchase Program/DividendDuring the quarter, the company returned $1.2 billion to shareholders through share buybacks and dividends.Subsequent Quarter End ActivitiesOn Apr 4, 2016, TE Connectivity concluded the buyout of healthcare device company Creganna Medical Group for $895 million, in a bid to expand and emerge as the industry leader in high-growth harsh environment applications.The acquisition will allow TE Connectivity to double its medical business revenues to approximately $500 million and cement its position in the high-growth minimally invasive medical device market. The company expects the deal to be accretive to the extent of $0.03 to adjusted earnings in the first full fiscal, while boosting interventional revenues by over $300 million.OutlookTE Connectivity expects third-quarter fiscal 2016 adjusted earnings per share in the range of $1.00–$1.06 and revenues between $3.00 and $3.20 billion. The adjusted earnings and revenue figures reflect the company’s concerns regarding foreign exchange headwinds.Concurrent with the present market scenario, the company narrowed its full-year fiscal 2016 guidance. It now expects adjusted earnings per share in the range of $3.90–$4.10 (previously guided in the range of $3.80–$4.20) and revenues in the band of $12.1–$12.5 million (previous guidance $11.9–$12.7 billion).To ConcludeThe company is currently experiencing a steady recovery in the automotive market and anticipates a rebound in its commercial transportation business in the forthcoming quarters, both of which hold immense potential. Going forward, TE Connectivity believes that the acquisition of Creganna will bolster its position in the harsh environment portfolio. Moreover, this acquisition is expected to drive growth in the Industrial solutions segment. In addition, though exit from the Circuit Protection business may have impacted financials in the short run, we believe this step will allow the company to channel its resources to more productive areas in the future, thereby augmenting long-term growth.TE Connectivity currently has a Zacks Rank #4 (Sell). Better-ranked stocks in the same space are CalAmp Corp. CAMP, Fabrinet FN and Littelfuse Inc. LFUS. All the three stocks flaunt a Zacks Rank #1 (Strong Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report TE CONNECT-LTD (TEL): Free Stock Analysis Report FABRINET (FN): Free Stock Analysis Report LITTELFUSE INC (LFUS): Free Stock Analysis Report CALAMP CORP (CAMP): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research