10-QPeriod: Q2 FY2025

CELESTICA INC Quarterly Report for Q2 Ended Jun 30, 2025

Filed July 28, 2025For Securities:CLS

Summary

Celestica Inc. (CLS) reported a strong second quarter and first half of 2025, demonstrating significant year-over-year growth in both revenue and net earnings. Revenue increased by 21% in the second quarter and 20% for the first half, driven by robust performance in the Connectivity & Cloud Solutions (CCS) segment, particularly its Hardware Platform Solutions (HPS) networking business. The Advanced Technology Solutions (ATS) segment also showed growth, bolstered by the Capital Equipment and Industrial businesses. Profitability improved significantly, with gross profit up 46% in the quarter and gross margin expanding to 12.8% due to higher volumes and a more favorable mix. Net earnings more than doubled year-over-year in the second quarter, reaching $211.0 million, or $1.82 per diluted share. The company also maintained a strong liquidity position, with substantial cash and cash equivalents and available credit facilities, while continuing its share repurchase program.

Financial Highlights

41 data points
Beta

Revenue

$2.89B

12.8% Gross Margin

Net Income

$211.00M

7.3% Net Margin

EPS (Diluted)

$1.82

Total Assets

$6.24B

Cash & Equivalents

$313.80M

Free Cash Flow

$152.40M

Financial Statements
Beta
Revenue$2.89B
Cost of Revenue$2.52B
Gross Profit$371.00M
R&D Expenses$34.00M
SG&A Expenses$38.90M
Operating Income$272.50M
Net Income$211.00M
EPS (Basic)$1.83
EPS (Diluted)$1.82
Shares Outstanding (Basic)115.10M
Shares Outstanding (Diluted)115.90M

Key Highlights

  • 1Total revenue for Q2 2025 reached $2.89 billion, a 21% increase year-over-year.
  • 2Net earnings for Q2 2025 were $211.0 million, a 122% increase compared to Q2 2024.
  • 3Diluted earnings per share (EPS) for Q2 2025 was $1.82, up 128% from $0.80 in Q2 2024.
  • 4The CCS segment revenue grew by 28% year-over-year, driven by a 75% increase in the Communications end market.
  • 5Gross margin improved to 12.8% in Q2 2025, up from 10.6% in Q2 2024, due to higher volumes and a favorable business mix.
  • 6The company repurchased 0.6 million common shares for cancellation in Q2 2025 for $40.0 million.

Frequently Asked Questions

Revenue growth was primarily driven by strong performance in the Connectivity & Cloud Solutions (CCS) segment, with a significant increase in the Communications end market fueled by demand for networking products from hyperscalers and program ramps. The Advanced Technology Solutions (ATS) segment also contributed positively, with growth in the Capital Equipment and Industrial businesses.

Profitability has improved significantly. Gross profit increased by 46% year-over-year in Q2 2025, and gross margin expanded to 12.8% from 10.6% in the prior year period. This improvement is attributed to higher volumes, a more favorable business mix, and effective cost management. Net earnings more than doubled, and diluted EPS saw a substantial increase.

Celestica maintains a strong liquidity position with $313.8 million in cash and cash equivalents as of June 30, 2025. The company has access to a $750 million revolving credit facility, with $90.0 million drawn and $648.9 million available at the end of the quarter. Celestica continues to execute its share repurchase program, buying back 0.6 million shares for $40.0 million in Q2 2025.

Yes, Celestica relies on a few key customers for a substantial portion of its revenue. In Q2 2025, two customers accounted for 31% and 13% of total revenue, respectively. For the first half of 2025, three customers represented 30%, 13%, and 10% of total revenue. This concentration is primarily within the CCS segment.