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 ranges.

• GAAP EPS was $3.17, up 74% year-over-year; net earnings for Q2 2026 were $368.8 million, a 75% increase.

• 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 driven by hyperscaler and data center demand.

• The 2026 annual outlook was raised for revenue ($20.5 billion), adjusted EPS ($11.30), and free cash flow ($600 million), with accelerated growth expected in 2027.

Financial highlights

• Adjusted EPS rose 83% year-over-year to $2.54; GAAP EPS was $3.17, up from $1.82 in Q2 2025.

• Adjusted operating margin expanded to 8.2%; adjusted gross margin was 11.5%, while GAAP gross margin was 12.3%.

• Adjusted ROIC reached 55.5%, up 20 percentage points year-over-year; GAAP ROIC was 65.8%.

• Free cash flow for Q2 2026 was $147.1 million; year-to-date was $285 million; 2026 outlook is $600 million.

• Cash and cash equivalents at June 30, 2026 were $535.7 million; net debt was $204 million; available liquidity was ~$2.3 billion.

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 outlook raised to $11.30 (from $10.15); free cash flow outlook increased to $600 million.

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

• Capital expenditures for 2026 are expected to be approximately $1 billion, funded from operations.

• Liquidity remains strong, with $535.7 million in cash and $1.74 billion available under the revolving credit facility at June 30, 2026.