Celestica (CLS) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenue reached $4.70 billion, up 62% year-over-year, with adjusted EPS of $2.54, both exceeding guidance; GAAP EPS was $3.17, up 74–75% year-over-year.

• Adjusted operating margin hit a record 8.2%, reflecting strong execution and robust demand, especially from CCS customers.

• Both CCS (up 84%) and ATS (up 8%) segments delivered strong growth and profitability improvements, with CCS accounting for 81% of total revenue.

• 2026 annual outlook raised: revenue now expected at $20.5 billion, adjusted EPS at $11.30, and free cash flow at $600 million, with accelerated growth anticipated in 2027.

• Growth is driven by strong demand in data center, AI/ML compute, and hyperscaler portfolios, with improved supply conditions.

Financial highlights

• Q2 2026 GAAP EPS was $3.17 (up from $1.82); adjusted EPS was $2.54 (up from $1.39); adjusted operating margin was 8.2%.

• Q2 2026 gross margin was 12.3% (down from 12.8%); adjusted gross margin was 11.5%.

• Free cash flow for Q2 2026 was $147.1 million; 2026 outlook is $600 million.

• Adjusted ROIC for Q2 2026 was 55.5%, up 20 percentage points year-over-year.

• Cash and cash equivalents at June 30, 2026 were $535.7 million; net debt stood at $204 million.

Outlook and guidance

• Q3 2026 revenue guidance: $5.25–$5.55 billion; adjusted EPS: $2.88–$3.08; adjusted operating margin expected at 8.4%.

• 2026 revenue outlook raised to $20.5 billion (from $19.0 billion); adjusted EPS to $11.30 (from $10.15); free cash flow to $600 million.

• 2027 revenue and adjusted EPS growth expected to accelerate beyond 2026 rates, driven by AI/ML and hyperscaler demand.

• CCS revenue for 2026 expected to grow ~85%; ATS revenue to grow ~10%.

• Capital expenditures for 2026 are expected to be approximately $1 billion.