Celestica Posts 83% Revenue Growth, Raises 2027 Forecast to $40 Billion

Key Facts

Celestica, Cadence and Rambus reported strong third-quarter 2026 results, with revenue and adjusted earnings growth at all three companies, and Celestica raised its preliminary 2027 revenue forecast to $40.0 billion. Celestica reported revenue of $5.83 billion for the quarter ended September 30, up 83% from the year-earlier period, and adjusted earnings per share of $3.30, compared with $1.58 a year earlier. The company said revenue and adjusted earnings per share exceeded the high end of its previous guidance. The results put companies operating at different points in the AI chain before investors: infrastructure at Celestica, chip and systems design at Cadence, and products and intellectual property at Rambus. Stock responses in trading after the announcements varied, with Celestica and Cadence shares rising while Rambus shares fell before the market open.

Celestica's growth was driven mainly by its Connectivity and Cloud Solutions segment, whose revenue rose 102% year over year to $4.87 billion. Revenue from its Advanced Technology Solutions segment increased 23% to $0.96 billion, according to the official results. The company said the demand environment "remains very strong" and that customers' demand expectations for 2028 are materially higher. Celestica tied this outlook to support from hyperscalers and advanced AI labs, helping explain its higher forecasts over the next two years. The company now expects 2026 revenue of $21.0 billion and adjusted earnings per share of $11.55, while its preliminary 2027 forecast calls for revenue of $40.0 billion and adjusted earnings of $21.50 per share. The stock jumped about 9.7% in after-hours trading following the results, according to Investing.com coverage.

Cadence, which specializes in software and tools for chip and systems design, reported revenue of $1.633 billion, compared with $1.339 billion a year earlier. Diluted non-GAAP earnings per share were $2.11, up from $1.93, while GAAP earnings per share held at $1.05 in both periods. Business details showed core electronic design revenue growing 20% year over year, intellectual property revenue rising 24%, and system design and analysis revenue increasing 30%. The company attributed demand to categories including AI-driven designs and advanced packaging. Backlog reached a record $8.2 billion, including $4.2 billion in remaining performance obligations expected to be recognized as revenue over the following twelve months. Cadence raised its annual forecast to revenue of between $6.387 billion and $6.417 billion and non-GAAP diluted earnings of between $8.37 and $8.43 per share.

Cadence's chief executive said the company launched Maestro, a suite of specialized AI models for chip and systems design, as the deployment of specialized AI agents accelerated. The stock rose 2.15% in after-hours trading following the results, after a 1.79% gain during the October 26 session, according to Investing.com coverage citing Reuters. Another report also noted a 2.4% rise in premarket trading on October 27. Backlog provides an indication of revenue the company may record in the near term, while steady GAAP earnings alongside a rise in the adjusted measure highlights a difference between the two profitability metrics. The results relate to chip and systems design activity, where Cadence said demand included AI applications and advanced packaging.

Rambus reported record quarterly revenue of $218.3 million, up 22% year over year, with diluted earnings per share of $0.69 on a GAAP basis and $0.84 on a non-GAAP basis. Both figures exceeded the previous guidance range, and earnings per share rose from $0.44 and $0.62, respectively, in the third quarter of 2025. Product revenue reached a record $114.3 million, up 15% from the previous quarter and 22% from the year-earlier period. The chief executive said "strong customer demand" supported record product revenue and operating cash flow. He added that the company is expanding its product and intellectual property offerings to meet performance requirements in next-generation AI systems and data centers.

For the next period, Rambus expects revenue of between $227 million and $233 million and non-GAAP diluted earnings of between $0.84 and $0.92 per share in the fourth quarter of 2026. The company said it expects stronger performance in the fourth quarter, citing strong customer demand. But the stock fell 2.1% in premarket trading on October 27, as investors focused on the next quarter's royalty revenue guidance, according to Investing.com. The three companies' shares closed on October 26 at $246.65 for Celestica, $322.17 for Cadence and $90.32 for Rambus. The results were released after that session closed, so those closing prices do not reflect a reaction to them.