Celestica revenue jumps 83% to $5.83 billion; preliminary outlook puts 2027 at $40 billion
Key Facts
Celestica reported revenue of $5.83 billion in the third quarter of 2026, up 83% from $3.19 billion in the same period last year, according to a company statement. It announced the results after the market close on October 26. The company said revenue exceeded the top end of its quarterly guidance range, citing “higher-than-expected customer demand and strong operational execution.” In the statement, it issued preliminary guidance for 2027, putting revenue at $40.0 billion. That figure remains management’s forward-looking estimate, not realized revenue.
The divergence puts the communications and cloud segment at the forefront of the expansion the company announced, while the other segment posted slower growth. Management attributed overall quarterly performance to improved customer demand and strong operational execution. The company did not directly attribute the results to any specific capital spending by major technology companies. Adjusted earnings per share also exceeded the top end of the company’s guidance, a comparison against its internal estimates for the quarter.
Adjusted operating margin improved to 8.5% in the third quarter, from 7.6% in the same period of 2025. But GAAP operating margin moved in the opposite direction, at 7.9% compared with 10.2% a year earlier. The divergence highlights that the adjusted margin measure alone does not reflect the change in accounting operating margin. The adjusted earnings-per-share figure the company included in its guidance is a non-GAAP measure. The company’s statement that the quarter exceeded expectations therefore relates to its guidance range, not analysts’ estimates.
The company raised its 2026 revenue guidance to $21.0 billion from $20.5 billion previously, and increased its adjusted earnings-per-share guidance to $11.55 from $11.30. By contrast, it lowered its free cash flow outlook to $460 million from $600 million. The updates present a mixed picture: higher estimates for revenue and adjusted earnings, alongside a lower forecast for cash generated after spending. The statement did not provide evidence in these figures that improved sales would translate into higher cash flow during the year. Each figure is based on the company’s 2026 forecasts.
In its fourth-quarter 2026 guidance, Celestica put revenue between $6.275 billion and $6.575 billion, and adjusted earnings per share between $3.37 and $3.57. Expected adjusted operating margin is 8.7% at the midpoint of the guidance ranges. These figures represent management’s framework for the period immediately after the quarter it reported, with revenue and earnings still tied to demand and execution levels. The preliminary 2027 estimates include adjusted earnings per share of $21.50 and an adjusted operating margin of 9.0%. The company also expects capital expenditures of between $1.5 billion and $2.0 billion that year.
The chief executive said the company continues to support large cloud service providers and AI labs, adding that “customer demand expectations for 2028 are clearly higher” than the 2027 revenue forecast. The statement indicates that management is basing its preliminary guidance for next year on demand expectations that extend beyond it, without making that guidance a guaranteed outcome. On August 5, the company announced a $3 billion share offering to fund investments supporting multi-year demand for AI infrastructure. In its results statement, it said its 2026 and 2027 estimates are affected by assumptions about demand, production schedules and component availability. It warned that actual results may differ materially from forward-looking statements.
In the share’s trading before the results announcement, EL7 data showed CLS closing at $299.69 on October 20 and then at $246.65 on October 26. The results were announced after the market close on the latter date. Accordingly, the trading data support attributing only the closing prices on those two dates. The company’s next figures are its fourth-quarter 2026 guidance, followed by its preliminary estimates for 2027.