Q3 2025 revenue and adjusted EPS* above the high end of our guidance ranges; Raising 2025 annual outlook
TORONTO,(GLOBE NEWSWIRE) — Celestica Inc.1 (NYSE: CLS) (TSX: CLS), a global leader in data center infrastructure and advanced technology solutions, today announced its financial results for the third quarter ended September 30, 2025 (Q3 2025).
Q3 2025 Highlights
- Revenue: $3.19 billion, increased 28% compared to $2.50 billion for third quarter of 2024 (Q3 2024).
- GAAP earnings from operations as a % of revenue: 10.2%, compared to 5.5% for Q3 2024.
- Adjusted operating margin (non-GAAP)*: 7.6%, compared to 6.8% for Q3 2024.
- GAAP earnings per share2 (EPS): $2.31, compared to $0.75 for Q3 2024.
- Adjusted EPS2 (non-GAAP)*: $1.58, compared to $1.04 for Q3 2024.
“We achieved very strong results in the third quarter, with revenue of $3.19 billion and non-GAAP adjusted EPS* of $1.58, representing growth of 28% and 52%, respectively, each exceeding the high end of our guidance ranges. In the quarter we achieved strong adjusted operating margin* of 7.6%, another high for the company, reflecting the continued strength of our execution.” said Rob Mionis, President and CEO of Celestica.
“Driven by these strong results to date and a demand environment that continues to strengthen, we are pleased to increase our 2025 annual outlook. We now expect revenue to reach $12.2 billion, an increase from the prior $11.55 billion, and anticipate non-GAAP adjusted EPS* of $5.90, up from our previous estimate of $5.50.”
“Furthermore, we are announcing our 2026 annual outlook with revenue of $16.0 billion and non-GAAP adjusted EPS* of $8.20, representing growth of 31% and 39% respectively. The demand outlook from our largest customers, who continue to make significant investments in AI data center infrastructure, remains strong, supporting our 2026 annual outlook with indications of these dynamics continuing into 2027.”
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 September 30, 2025 unaudited interim condensed consolidated financial statements (Q3 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 (*).
Fourth Quarter of 2025 (Q4 2025) Guidance
| Q4 2025 Guidance | |
| Revenue (in billions) | $3.325 to $3.575 |
| Adjusted operating margin (non-GAAP)* | 7.6% at the mid-point of our revenue and non-GAAP adjusted EPS guidance ranges |
| Adjusted EPS (non-GAAP)*(1) | $1.65 to $1.81 |
(1) Q4 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. Q4 2025 guidance assumes a non-GAAP adjusted effective tax rate* of approximately 20%.
2025 Annual Outlook Update
- Revenue of $12.2 billion (previous outlook $11.55 billion) (1)
- Adjusted EPS (non-GAAP)* of $5.90 (previous outlook $5.50) (1)
- Non-GAAP free cash flow* of $425 million (previous outlook $400 million) (1)
Our previous adjusted operating margin (non-GAAP)* outlook of 7.4% remains unchanged.
(1) The increase of our 2025 annual outlook is driven by our strong results in Q3 2025, as well as expected stronger customer demand for the fourth quarter of 2025.
2026 Annual Outlook
- Revenue of $16.0 billion
- Adjusted operating margin (non-GAAP)* of 7.8%
- Adjusted EPS (non-GAAP)* of $8.20
- Non-GAAP free cash flow* of $500 million
Our Q4 2025 Guidance, 2025 Annual Outlook Update and 2026 Annual Outlook assume no material changes to tariffs or trade restrictions compared to what are in effect as of October 27, 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 Q4 2025 Guidance, 2025 Annual Outlook Update and 2026 Annual Outlook, 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 Q3 2025 Results
| Q3 2025 Actual | Q3 2025 Guidance(2) | ||
| Revenue (in billions) | $3.19 | $2.875 to $3.125 | |
| GAAP earnings from operations as a % of revenue | 10.2% | N/A | |
| GAAP EPS(1) | $2.31 | N/A | |
| Adjusted operating margin (non-GAAP)* | 7.6% | 7.4% at the mid-point of our revenue and non-GAAP adjusted EPS guidance ranges |
|
| Adjusted EPS (non-GAAP)* | $1.58 | $1.37 to $1.53 | |
CCS segment revenue: $2.41 billion, increased 43% compared to Q3 2024; CCS segment margin: 8.3% compared to 7.6% for Q3 2024. Hardware Platform Solutions revenue of approximately $1.4 billion increased 79% compared to Q3 2024.
ATS segment revenue: $0.78 billion, decreased 4% compared to Q3 2024; ATS segment margin: 5.5% compared to 4.9% for Q3 2024.
(1) GAAP EPS of $2.31 for Q3 2025 included an aggregate charge of $0.25 per share (pre-tax) for employee SBC expense, amortization of intangible assets (excluding computer software), and restructuring charges (Q3 2024 — $0.20 per share (pre-tax)). See the tables in Schedule 1 and note 11 to the Q3 2025 Interim Financial Statements for per-item charges. This aggregate charge was within our previously communicated Q3 2025 anticipated range of between $0.23 to $0.29 per share for these items.
GAAP EPS for Q3 2025 and the first nine months of 2025 (YTD 2025) also included a $0.98 and $1.65, respectively, per share (pre-tax) positive impact attributable to our total return swap agreement (Q3 2024 — $0.06 per share (pre-tax) negative impact; the first nine months of 2024 — $0.33 per share (pre-tax) positive impact). See note 9 to our Q3 2025 Interim Financial Statements.
(2) For Q3 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 Q3 2025 exceeded the mid-point of our revenue and non-GAAP adjusted EPS guidance ranges and our Q3 2025 adjusted EPS exceeded the high end of our guidance range, primarily driven by stronger than anticipated operating leverage in our Communications end market. Our GAAP effective tax rate for Q3 2025 was 14%. Our adjusted effective tax rate (non-GAAP) for Q3 2025 was 20%, higher than our anticipated estimate of approximately 19%, primarily due to jurisdiction profit mix.
Intention to launch New Normal Course Issuer Bid (NCIB)
We intend to file a notice of intention with the Toronto Stock Exchange (TSX) to commence a new NCIB in Q4 2025, after our current NCIB expires on October 31, 2025. If this notice is accepted by the TSX, we expect to be permitted to repurchase for cancellation, at our discretion during the twelve (12) months following such acceptance, up to 5% of the “public float” (calculated in accordance with TSX rules) of our issued and outstanding common shares. Purchases under the new NCIB, if accepted by the TSX, will be conducted in the open market or as otherwise permitted, subject to applicable terms and limitations, and will be made through the facilities of the TSX and the New York Stock Exchange. We believe that a new NCIB is in the best interests of Celestica and our shareholders.
Q3 2025 Financial Results Conference Call and 2025 Investor and Analyst Day
Management will host its Q3 2025 financial results conference call and 2025 Investor and Analyst Day on October 28, 2025. The conference call start time is 8:00 a.m. Eastern Daylight Time (EDT). The webcast can be accessed at www.celestica.com.
