Celestica Q2 Earnings Call Highlights

Key Points Interested in Celestica, Inc.? Here are five stocks we like better. Record Q2 performance: Revenue rose 62% year over year to $4.

70 billion and adjusted EPS increased 83% to $2.54, driven by strong AI infrastructure and networking demand. Adjusted operating margin reached a company-record 8.

2%. Raised outlook and accelerating AI pipeline: Celestica lifted its 2026 revenue forecast to $20.5 billion and adjusted EPS outlook to $11.

30, while expecting 2027 growth to exceed 2026 levels. The company cited hyperscaler AI/ML programs, AMD racks and an OpenAI custom-rack opportunity as major growth drivers. Capacity expansion remains essential: Component availability is the company's primary constraint as demand exceeds reported revenue capacity.

Celestica plans approximately $1 billion in 2026 capital expenditures and is expanding facilities in Thailand, Japan and Texas to support upcoming program ramps. 3 Up-and-Coming Stocks That Could Be the Next NVIDIA Celestica (NYSE:CLS) reported second-quarter 2026 revenue and adjusted earnings per share above the high end of its guidance, supported by demand for AI infrastructure and networking programs. The company also raised its full-year outlook and said it expects revenue growth to accelerate in 2027.

Second-quarter revenue reached $4.70 billion, up 62% from a year earlier, while adjusted EPS rose 83% to $2.54.

Non-GAAP operating margin expanded 80 basis points to a company record of 8.2%. → Volatility Is Back and These 3 Market Tollbooths Are Best Positioned to Profit 5 AI Infrastructure Stocks Smart Money Is Buying Before the Next Surge "These results reflect strong operational execution across both segments, alongside record demand from our CCS customers," Chief Executive Officer Rob Mionis said.

He cited technology upgrade cycles in networking and AI compute, as well as significant programs expected to launch in the second half of 2026 and into 2027. CCS Growth Led by Networking and AI Compute Celestica's Connectivity & Cloud Solutions, or CCS, segment generated $3.81 billion in quarterly revenue, a year-over-year increase of 84%.

The segment represented 81% of total company revenue and posted an 8.7% margin, up 40 basis points, as higher volumes produced operating leverage. → 2 Stocks Built to Thrive If Inflation Refuses to Fade 3 Stocks Poised to Benefit From Google's AI Breakthough Communications end-market revenue increased 62%, exceeding the company's outlook for roughly 50% growth.

Chief Financial Officer Mandeep Chawla said the increase was primarily driven by 800G networking switch programs, with continued demand for 400G programs. Story Continues Enterprise end-market revenue climbed 167%, also ahead of guidance, driven by an accelerated ramp of a hyperscaler AI and machine-learning compute program and stronger storage demand. Celestica's hardware platform solutions, or HPS, business contributed $1.

9 billion in revenue, up 58%, as 800G switch programs ramped across multiple hyperscale customers. → This Tiny AI Supplier Could Be More Important Than the Chipmakers For the third quarter, Celestica expects communications revenue growth of approximately 60%, including demand for 800G programs and the start of mass-production ramps for its first 1.6-terabit programs.

Enterprise revenue is expected to rise about 190% on continued hyperscaler AI/ML compute demand and improved storage demand. Mionis said the company has 10 active 1.6T programs and expects those programs to gain momentum in 2027, while 800G and 400G products continue to grow.

A co-packaged optics program is expected to begin sampling in the first half of 2027 and enter mass production in the second half of that year, he said. ATS Segment Returns to Faster Growth Advanced Technology Solutions, or ATS, revenue increased 8% to $888 million, above the company's outlook for a mid-single-digit percentage gain. Revenue grew across each of the segment's businesses, and ATS accounted for 19% of Celestica's total quarterly revenue.

ATS margin rose 100 basis points to 6.3%, supported by operating leverage and a higher engineering-driven product mix. The company expects ATS revenue to increase in the mid-teens percentage range in the third quarter, primarily due to capital equipment demand and new program ramps.

For the full year, Celestica now expects ATS revenue to rise approximately 10%. Mionis said growth is accelerating in the second half, led by sequential improvement in the capital equipment business, where the company anticipates wafer-fab equipment demand tailwinds will continue into 2027. Company Raises 2026 Outlook, Sees Faster 2027 Growth Celestica raised its 2026 revenue outlook to $20.

5 billion from $19 billion, implying 65% growth, and increased its adjusted EPS forecast to $11.30 from $10.15.

The company now expects full-year adjusted operating margin of 8.4%, up from its prior 8.1% outlook, and free cash flow of $600 million, compared with prior guidance of $500 million.

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