Shares of Toronto electronics manufacturing giant Celestica Inc. rocketed more than 12% to a session-closing high of 389.08 Canadian dollars in Toronto on the Toronto Stock Exchange today, as demand for artificial intelligence surged and the company’s stock topped out at new all-time records.
The meteoric rise came on the heels of blockbuster third-quarter 2025 numbers, with revenue coming in hot on the heels of expectations due to hyperscaler orders in the connectivity and cloud computing segments, leaving Wall Street in pursuit. The company has a front-row view of the artificial intelligence revolution, and both institutional heavyweights and retail punters have bet big with 2.8 million shares, three times the norm, pouring money into the front-row seat.
The book recorded a story of unmitigated momentum. Celestica reported Q3 revenue of $2.65 billion, a whopping 28 per cent increase from the previous year and easily beating the 2.45 billion consensus whisper. The Connectivity & Cloud Solutions division, powering data centres for the likes of Nvidia and Amazon, rocketed 45% to 1.8 billion dollars, fueled by AI server builds and optical module ramps.
Aerospace & Defence rose 8% to 450 million from a surge in defence spending, and Industrial & Healthcare increased a steady 12% to 400 million, driven by the outsourcing of medical devices. Thanks to the high price of AI and supply chain optimisations that also kept it out of tariff landmines, gross margins jumped to 9.8% from 8.2% a year ago.
Bottom-line fireworks were also impressive: adjusted operating earnings came in at 142 million dollars, up 35%, with EPS jumping to 2.14 dollars, as expected, against 1.72 dollars. Cash flow came in hot at 180 million dollars, adding to a war chest that is now at more than 600 million dollars in liquidity, with net debt reduced by 20%.
Management was optimistic about the “AI tailwind”, saying that, CEO Rob Falconer, during the call, that hyperscaler capex – projected at 200 billion dollars globally in 2025 – is putting Celestica in a position that allows the company to experience multi-year compounding.
Speaking of AI’s power, Falconer said that an order book is already up by 50% for AI-related kit, the message of which was that we’re not just hitching a ride on the wave; we’re building the board.
With the annual revenue forecast being revised to $10.2 billion, an increase of 5% from initial expectations, and rumours that 2026 could see $12 billion, the fire that was lit under the bulls shows no sign of subsiding in the near future, given the continued enthusiasm for AI.
RBC raised its target to 420 dollars on 25% EPS growth through 2027, while TD increased to 410 dollars on an 11% margin expansion. Trading at 18 times forward earnings, a bargain compared to U.S. peers such as 22 times forward earnings for Jabil, highlighting Celestica’s Canadian cost advantage and diversified Asian and Mexican presence.
The rally in tech on the TSX helped buoy names like BlackBerry and Ballard Power as the Composite gained 0.22% to 30,216 points. The market discounted sticky inflation prints and Fed hawkishness to focus on Celestica’s 15% North American market share in electronic manufacturing services and its shift from legacy automobiles to high-margin AI. Crude energy dropped off, but Celestica’s star turn added $1.2 billion to its cap lift, moving it past 45 billion in market value.
This spurt comes at the end of a stellar year for Celestica, which has quadrupled since the pandemic troughs on a foundation of supply chain acumen and smart bets on electrification. Precision machining acquisitions, such as Siebe, have added 10% organic, and nearshoring will protect against U.S.-China trade frictions.
Q4 sneak previews blockbuster AI rack integrations, 5G edge computing with partners and chip titans getting closer. As for the holiday season, data centre builds are a continual 24/7 reality, whereas e-commerce logistics is just a supporting act.
Celestica has the profile of a Canadian portfolio’s dream: 0.36 dollars quarterly dividend yield, 2.1% after-tax payout, and aggressive buybacks that gobble 5% of float every year. Short squeeze risks lurk as bears cover 25% of positions following today’s baselining. Deal talk is rampant as private equity nurses its 20 billion dollar backlog, but insiders say organic firepower is more than enough.
As Diwali lights flicker and Black Friday approaches, Celestica is Canada’s tech renaissance – brainpower from the Waterloo corridors to feed the computing hunger of the globe.
With AI capex cycles just now revving up, shares could rise to 400 bucks by December, which would reward the early adopters in this silicon gold rush. In a world of uncertainty, Celestica’s earnings outlook is striking a bullish note, striking a harmonious note between innovation and ironclad execution for the investors north of the border.