Celestica (CLS) investor relations material

Executive summary

• Q1 2026 revenue reached $4.05 billion, up 53% year-over-year, driven by strong demand in the Connectivity & Cloud Solutions (CCS) segment, particularly from hyperscaler and data center customers, and exceeding guidance.

• Adjusted EPS was $2.16, up 80% year-over-year and above guidance; GAAP EPS was $1.83, up 147%.

• Adjusted operating margin hit a record 8.0%, with GAAP operating margin at 6.7%, both up year-over-year.

• The annual outlook for 2026 was raised to $19.0 billion in revenue and $10.15 adjusted EPS, reflecting robust demand and new program wins.

• The company amended and upsized its credit facility, increasing revolving commitments to $1.75 billion and extending maturities to April 2031.

Financial highlights

• Adjusted gross margin was 11.3%, up 30 basis points year-over-year; GAAP gross margin was 10.8%, up 0.5 percentage points.

• Free cash flow for Q1 2026 was $137.9 million, up from $93.6 million in Q1 2025.

• Adjusted ROIC reached 49.8%, up from 31.5% a year ago; GAAP ROIC was 41.7%.

• Cash balance at quarter-end was $378 million; net debt stood at $341 million; total liquidity was ~$2 billion.

• Repurchased 0.1 million shares for $20 million in Q1 2026.

Outlook and guidance

• Q2 2026 revenue guidance: $4.15–$4.45 billion; adjusted EPS: $2.14–$2.34; adjusted operating margin expected at 8.0%.

• 2026 annual outlook raised to $19.0 billion revenue and $10.15 adjusted EPS, with adjusted operating margin of 8.1%.

• Free cash flow guidance for 2026 reaffirmed at $500 million, with capital expenditures expected at $1 billion.

• 2027 revenue expected to exceed $25.5 billion, with strong growth in CCS and ATS segments and improved demand visibility.

• End market Q2 2026 outlook: ATS up mid-single digits, Communications up ~50%, Enterprise up ~130% year-over-year.