A hybrid electro-mechanical transmission connectable with multiple power sources for launching and propelling a vehicle includes an output member and a stationary member. The transmission also includes a first planetary gear set having a first, a second, and a third node and a compound planetary gear arrangement having a fourth, a fifth, a sixth, and a seventh node. The engine, the first motor/generator and the second motor/generator are each operatively connected with the first planetary gear set, and the output member and the second motor/generator are each operatively connected with the compound planetary gear arrangement. Thus configured, the transmission provides an under-drive gear for launching the vehicle, as well as a direct-drive gear and an over-drive gear for propelling the vehicle at higher speeds.