Celestica Targets $40 Billion in 2027 Revenue, With 90% Growth Expected
Key Facts
Celestica announced on October 26 that revenue reached $5.83 billion in the quarter ended September 30, 2026, up 83% from $3.19 billion in the same period a year earlier. The company issued an initial 2027 revenue outlook of $40 billion, equivalent to expected growth of 90%. It also expects adjusted earnings per share of $21.50 and an adjusted operating margin of 9.0% for the year. The CEO said, "The demand environment remains very strong," supporting the 2027 revenue outlook. He added that customer demand expectations for 2028 are clearly higher than those for 2027.
Third-quarter results came in above the ranges the company had set for revenue, between $5.25 billion and $5.55 billion, and adjusted earnings per share, between $2.88 and $3.08. Adjusted earnings per share came in at $3.30. The adjusted operating margin rose to 8.5% from 7.6% in the third quarter of 2025. By contrast, operating income under U.S. accounting standards as a share of revenue fell to 7.9% from 10.2% a year earlier. These indicators show how margin trends differ depending on the profitability measure used.
Connectivity and Cloud Solutions led growth, with revenue of $4.87 billion, up 102% year over year in the third quarter. Advanced Technology Solutions recorded revenue of $0.96 billion, up 23%. The gap between the growth rates reflects uneven performance across the company's businesses during the period. This comes as management says customer demand supports its elevated outlook for next year. The company tied its forward outlook to a sustained cycle of strong demand for AI infrastructure.
Alongside its 2027 target, Celestica raised its 2026 revenue outlook to $21 billion from $20.5 billion and increased its adjusted earnings per share outlook to $11.55 from $11.30. It lowered its free cash flow estimate to $460 million from $600 million, however. The company attributed the reduction mainly to targeted working capital investments to support accelerating growth in 2027. In its July update, it had raised its 2026 revenue outlook to $20.5 billion from $19 billion and its adjusted earnings per share outlook to $11.30 from $10.15. At the time, the company expected an adjusted operating margin of 8.4%.
Compared with its July outlook, the company was then expecting 2027 revenue growth to exceed the 65% rate it had used to estimate 2026 growth. Celestica said at the time that strong customer demand and new program wins supported that trajectory. In the second quarter of 2026, revenue reached $4.70 billion, up 62% from $2.89 billion in the second quarter of 2025. Adjusted earnings per share for that quarter were $2.54, compared with $1.39 a year earlier. The latest third-quarter results show higher year-over-year growth than the increase recorded in the second quarter.
For the fourth quarter of 2026, the company expects revenue of between $6.275 billion and $6.575 billion and adjusted earnings per share of between $3.37 and $3.57. It also plans capital expenditures of between $1.5 billion and $2 billion in 2027, as part of investments it says are intended to support multiyear growth. Expected free cash flow for 2026 remains at $460 million after being cut from $600 million. The company warned of risks related to changes in customers' capacity plans, power and water constraints at data centers, delayed program launches or component shortages. It also cited power and supply constraints across the data center ecosystem as challenges.