- Celestica is a technology leader in design, manufacturing, hardware and supply chain solutions with a global presence spanning North America, Europe and Asia, and a client roster featuring some of the world’s biggest brands
- The company’s growing role as a data centre service provider has propelled revenue and profits higher since ChatGPT hit the scene in 2022
- Celestica stock has soared in response, adding more than 1,700 per cent
When OpenAI launched ChatGPT in 2022, it unleashed a global wave of interest and capital into artificial intelligence (AI), with companies across the industry spectrum scrambling to increase computing power and develop AI models to reach newfound levels of operational efficiency.
This content has been prepared as part of a partnership with Celestica Inc., and is intended for informational purposes only.
This frenzy has attracted some of the largest companies in the world, including Amazon, Alphabet and Meta, propelling each of them to multi-trillion-dollar market capitalizations, with Alphabet estimating that it will spend US$85 billion in 2025 on computing and AI to compete on the leading edge of data processing power.
AI demand has also been favorable to picks-and-shovels players that have proven themselves to be reliable suppliers for the data centers developers need to test and deploy their projects. As a result, investors have candidates for due diligence for days, with US Money News and Yahoo! Finance hosting the most-viewed lists of prospective stocks on Google as of July 29.
One supplier both fail to mention, Celestica (TSX:CLS), market capitalization C$32.16 billion, Canada’s third-largest technology company, is a model for how strategic industry alignment can translate into shareholder value, with the stock having added more than 100 per cent year-to-date, more than 300 per cent year-over-year and more than 1,700 per cent since ChatGPT’s debut, thanks to:
- Pre-ChatGPT data centre servicing contracts with Amazon, Alphabet and Meta.
- Margin expansion thanks to a shift towards proprietary products, following the arrival of chief executive officer Rob Mionis in 2015, with 43 per cent of its current line designed in house.
- A diversified client base across aerospace and defense, communications, enterprise, health technology, industrial and capital equipment.
- A turnkey service offering, from design to manufacturing to hardware platforms to supply chain solutions and full-scale production.
- The fact that AI, nascent as it may be, is delivering tangible value to companies across the board, saving time and resources, differentiating value propositions and pushing stock prices higher.
Celestica has parlayed its prime position into impressive financials over the period, generating US$7.96 billion in revenue in 2023 and US$9.64 billion in 2024, backed up by net income of US$244.4 million and US$428 million, respectively, driven by rapidly accelerating demand.
Q1 and Q2 2025 have been similarly value-accretive, delivering US$2.65 billion and US$2.89 billion in revenue, coupled with net income of US$86.2 million and US$211 million, respectively, with a robust demand outlook prompting the company to increase 2025 guidance twice over the period. The company expects to generate US$11.55 billion in revenue for the year, up from US$10.85 billion, and non-GAAP adjusted earnings per share of US$5.50, up from US$5.
Celestica is further differentiated by pricing power. As confirmed in the Q2 news release, the company is positioned to recover almost all tariffs paid under US President Trump’s regime from its customers, with no expected material impact to non-GAAP adjusted operating earnings or non-GAAP adjusted net earnings, demonstrating the insatiable demand for AI functionality running its way through every imaginable market.
As Mionis put it in the Q2 earnings call, “we continue to anticipate another year of solid financial performance for Celestica in 2025,” remaining “confident in our ability to continue our strong momentum, even with the uncertainty in the current macro environment,” adding that “we believe we are positioned to continue to excel and to sustain this positive momentum into 2026 and over the long term.”
Given the multi-year upside potential at play with Celestica, investors have a chance to buy into what may prove to be a value price, despite what the company’s C$277.95 share price and price-to-earnings ratio of 46.5 may suggest at first glance.
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