01—Abstract
Summary
Summary of the 10-Q filed July 28, 2025. Cited figures are marked; the original filing is the authoritative source.
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%a 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 millionb, 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.
02—Key points
Key Highlights
- Total revenue for Q2 2025 reached $2.89 billion, a 21% increase year-over-year.
- Net earnings for Q2 2025 were $211.0 million, a 122% increase compared to Q2 2024.
- Diluted earnings per share (EPS) for Q2 2025 was $1.82, up 128% from $0.80 in Q2 2024.
- The CCS segment revenue grew by 28% year-over-year, driven by a 75% increase in the Communications end market.
- Gross margin improved to 12.8% in Q2 2025, up from 10.6% in Q2 2024, due to higher volumes and a favorable business mix.
- The company repurchased 0.6 million common shares for cancellation in Q2 2025 for $40.0 million.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2025, Celestica Inc kept $0.07.
- Revenue$2.89B100.0%
- Cost of revenue−$2.52B87.2%
- Gross profit$371.0M12.8%
- Operating costs−$98.5M3.4%
- Operating income$272.5M9.4%
- Interest, other & tax−$61.5M2.1%
- Net income$211.0M7.3%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2025filed July 28, 2025Financial Statements
Q2 FY2025 against Q2 FY2024
| Line item | Q2 FY2025Q2 FY2024 | Change |
|---|---|---|
| Revenue | $2.89B$2.39B | +21.0% |
| Cost of Revenue | $2.52B$2.14B | +18.0% |
| Gross Profit | $371.00M$253.80M | +46.2% |
| R&D Expenses | $34.00M$19.40M | +75.3% |
| SG&A Expenses | $38.90M$79.30M | −50.9% |
| Operating Income | $272.50M$132.90M | +105.0% |
| Net Income | $211.00M$95.00M | +122.1% |
| EPS (Basic) | $1.83$0.80 | +128.8% |
| EPS (Diluted) | $1.82$0.80 | +127.5% |
| Shares Outstanding (Basic) | 115.10M118.80M | −3.1% |
| Shares Outstanding (Diluted) | 115.90M119.40M | −2.9% |
05—Questions
Frequently Asked Questions
What were the main drivers of revenue growth in Q2 2025?
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.
How has the company's profitability changed compared to the previous year?
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.
What is the company's current liquidity position and how is it managing its capital?
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.
Are there any significant customer concentrations that investors should be aware of?
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.
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