Celestica Inc. (TSX: CLS) is establishing itself as a leading contender in the Canadian stock market. By 2026, it is poised to capitalize on the booming demand for data centers and artificial intelligence (AI) infrastructure solutions.
Strong Demand for AI Infrastructure
As a global provider of design, manufacturing, and supply chain solutions, Celestica has focused on hardware for data centers, networking, and storage. The company serves various sectors, including hyperscalers and enterprises, which are heavily investing in technologies to support AI workloads.
Impressive Financial Performance
Celestica’s stock has experienced significant growth, increasing nearly 142% in the past year and an astonishing 2,300% over three years. Currently, the share price is approximately $422, with a market capitalization of around $48.6 billion. This performance is driven by:
- Increased demand from hyperscalers for AI-compatible solutions.
- Improving profitability due to scaling programs across Celestica’s global manufacturing.
Third Quarter 2025 Results
In the third quarter of 2025, Celestica reported a 28% year-over-year revenue increase to US$3.2 billion, surpassing management’s projections. Key achievements include:
- Adjusted earnings rising 52% year-over-year to US$1.58 per share.
- Adjusted operating margin improving to 7.6%, one of the highest in company history.
- A 43% revenue increase in the connectivity and cloud solutions segment, boosted by demand for AI-related hardware.
Future Growth Prospects
Celestica’s management is optimistic and has raised guidance for the full year of 2025 while also introducing a positive forecast for 2026. The company is heavily investing in next-gen AI data center platforms. Its new SD6300 ultra-dense storage platform is engineered to help clients manage growing data volumes efficiently and cost-effectively.
To meet the increasing complexities of AI deployments, Celestica is also expanding its engineering talent, manufacturing capacity, and cooling and networking capabilities. Such advancements further position the company to capture the rising demand for data ingest, storage, and archiving solutions.
Share Buyback and Confidence in Future
The recently initiated share buyback program underscores management’s confidence in Celestica’s robust cash flow generation and its potential for long-term value creation.
Conclusion
With expectations of continued growth in AI infrastructure spending through 2026, Celestica is likely to become one of the most attractive stocks on the TSX. Investors looking for growth opportunities should keep a close eye on this company as it navigates this exciting market landscape.
