Q2 2025 revenue and adjusted EPS* above the high end of our guidance ranges; raising 2025 annual outlook
TORONTO (GLOBE NEWSWIRE) — Celestica Inc.1 (TSX and NYSE: CLS), a leader in design, manufacturing, hardware platform and supply chain solutions for the world’s most innovative companies, today announced financial results for the quarter ended June 30, 2025 (Q2 2025).
Q2 2025 Highlights
- Revenue: $2.89 billion, increased 21% compared to $2.39 billion for second quarter of 2024 (Q2 2024).
- GAAP earnings from operations as a % of revenue: 9.4%, compared to 5.6% for Q2 2024.
- Adjusted operating margin (non-GAAP)*: 7.4%, compared to 6.3% for Q2 2024.
- GAAP earnings per share2 (EPS): $1.82, compared to $0.80 for Q2 2024.
- Adjusted EPS2 (non-GAAP)*: $1.39, compared to $0.90 for Q2 2024.
- Repurchased 0.6 million common shares for cancellation for $40.0 million in Q2 2025.
“We achieved very strong results in the second quarter, with revenue of $2.89 billion and non-GAAP adjusted EPS* of $1.39, representing growth of 21% and 54%, respectively, each exceeding the high end of our guidance ranges. This performance was bolstered by strong adjusted operating margin* of 7.4%, another new high for the company, demonstrating the strength of our execution,” stated Rob Mionis, President and CEO.
“With our strong first half results, and a strengthening demand outlook from our CCS customers, we are increasing our full-year 2025 outlook. We now expect revenue to reach $11.55 billion, an increase from the prior $10.85 billion, and anticipate non-GAAP adjusted EPS* of $5.50, up from our previous estimate of $5.00.”
1 Celestica has two operating and reportable segments: Advanced Technology Solutions (ATS) (comprised of our Aerospace and Defense (A&D), Industrial, HealthTech and Capital Equipment businesses), and Connectivity & Cloud Solutions (CCS) (consists of our Communications and Enterprise (servers and storage) end markets). Segment performance is evaluated based on segment revenue, segment income and segment margin (segment income as a percentage of segment revenue). See note 3 to our June 30, 2025 unaudited interim condensed consolidated financial statements (Q2 2025 Interim Financial Statements) for further detail.
2 Per share information included in this press release is based on diluted shares outstanding unless otherwise noted.
* See Use of Non-GAAP Measures and Schedule 1 for, among other items, non-GAAP financial measures (and ratios) included in this press release, their definitions, uses, and a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures. Non-GAAP measures in this press release are denoted with an asterisk (*).
Third Quarter of 2025 (Q3 2025) Guidance
| Q3 2025 Guidance | |
| Revenue (in billions)(1) | $2.875 to $3.125 |
| Adjusted operating margin (non-GAAP)* | 7.4% at the mid-point of our revenue and non-GAAP adjusted EPS guidance ranges |
| Adjusted EPS (non-GAAP)*(1) (2) | $1.37 to $1.53 |
| (1) | Our guidance ranges for revenue and non-GAAP adjusted EPS have been expanded relative to prior quarters, in order to reflect the growth in our business. | |
| (2) | Q3 2025 guidance excludes a negative $0.23 to $0.29 per share (pre-tax) aggregate impact on net earnings on a GAAP basis for employee stock-based compensation (SBC) expense, amortization of intangible assets (excluding computer software), and restructuring charges. Q3 2025 guidance assumes a non-GAAP adjusted effective tax rate* of approximately 19%. | |
2025 Annual Outlook Update
- Revenue of $11.55 billion (previous outlook $10.85 billion)
- Adjusted operating margin (non-GAAP)* of 7.4% (previous outlook 7.2%)
- Adjusted EPS (non-GAAP)* of $5.50 (previous outlook $5.00)
- Non-GAAP free cash flow* of $400 million (previous outlook $350 million)
Our Q3 2025 Guidance and 2025 Annual Outlook Update assume no material changes to tariffs or trade restrictions compared to what are in effect as of July 28, 2025 and no material changes from current macroeconomic trends and uncertainties. Substantially all tariffs paid by Celestica are expected to be recovered from our customers, and are not expected to materially impact our non-GAAP adjusted EBIAT* or non-GAAP adjusted net earnings* dollars.
* See Use of Non-GAAP Measures and Schedule 1. For our Q3 2025 Guidance and 2025 Annual Outlook Update, we present certain forward-looking non-GAAP metrics. A reconciliation of such forward-looking non-GAAP measures to the most directly comparable GAAP measures on a forward-looking basis has not been provided because the items that we exclude from GAAP to calculate the comparable non-GAAP measure are dependent on future events that are not able to be reliably predicted by management and are not part of our routine operating activities. We are unable to provide such a reconciliation without unreasonable effort due to the uncertainty and inherent difficulty in predicting the occurrence, the financial impact and the periods in which the adjustments may be recognized. The occurrence, timing and amount of any of the items excluded from GAAP to calculate non-GAAP could significantly impact our GAAP results.
Summary of Selected Q2 2025 Results
| Q2 2025 Actual | Q2 2025 Guidance(2) | ||
| Revenue (in billions) | $2.89 | $2.575 to $2.725 | |
| GAAP earnings from operations as a % of revenue | 9.4% | N/A | |
| GAAP EPS(1) | $1.82 | N/A | |
| Adjusted operating margin (non-GAAP)* | 7.4% | 7.2% at the mid-point of our revenue and non-GAAP adjusted EPS guidance ranges |
|
| Adjusted EPS (non-GAAP)* | $1.39 | $1.17 to $1.27 | |
CCS segment revenue: $2.07 billion, increased 28% compared to Q2 2024; CCS segment margin: 8.3% compared to 7.0% for Q2 2024. Hardware Platform Solutions revenue of approximately $1.2 billion increased 82% compared to Q2 2024.
ATS segment revenue: $0.82 billion, increased 7% compared to Q2 2024; ATS segment margin: 5.3% compared to 4.6% for Q2 2024.
| (1) | GAAP EPS of $1.82 for Q2 2025 included an aggregate charge of $0.33 per share (pre-tax) for employee SBC expense, amortization of intangible assets (excluding computer software), and restructuring charges (Q2 2024 — $0.23 per share (pre-tax)). See the tables in Schedule 1 and note 11 to the Q2 2025 Interim Financial Statements for per-item charges. This aggregate charge was above our previously communicated Q2 2025 anticipated range of between $0.23 to $0.29 per share for these items, primarily due to higher than expected restructuring charges. | |
| GAAP EPS for Q2 2025 and the first half of 2025 (1H 2025) also included a $0.84 and $0.67, respectively, per share (pre-tax) positive impact attributable to a fair value gain on our total return swap agreement (TRS Gain) (Q2 2024 and the first half of 2024 — $0.13 and $0.40, respectively, per share (pre-tax) positive impact attributable to the TRS Gain). See note 9 to our Q2 2025 Interim Financial Statements. | ||
| (2) | For Q2 2025, our revenue exceeded the high end of our guidance range due to higher than anticipated customer demand, particularly in our Communications end market. Our non-GAAP adjusted operating margin for Q2 2025 exceeded the mid-point of our revenue and non-GAAP adjusted EPS guidance ranges and our Q2 2025 adjusted EPS exceeded the high end of our guidance range, primarily driven by stronger than anticipated operating leverage in both our segments. Our GAAP effective tax rate for Q2 2025 was 18%. As anticipated, our adjusted effective tax rate (non-GAAP) for Q2 2025 was 20%. | |
Q2 2025 Financial Results
Management will host its Q2 2025 results conference call on July 29, 2025 at 8:00 am. Eastern Daylight Time (EDT). The webcast can be accessed at www.celestica.com.
