CLS · US
CLS.US: Q2'26 update — AI server ODM + liquid-cooling racks
Celestica Q2 2026 (ended 2026-06-30) revenue $4.70B (+62%), CCS $3.81B (+84%), adj EPS $2.54, adj op margin 8.2%. FY26 outlook raised to $20.5B revenue and $11.30 adj EPS. AI server ODM / liquid cooling / OpenAI rack thesis is clear, but competition vs SMCI is intensifying. See VRT, NVDA, AVGO, CRDO.
Cite a section with a deep link, e.g. /en/r/cls-us-research#thesis
Q2 2026 snapshot
- Q2 revenue (+62%)
- USD 4.7B
- CCS (+84%)
- USD 3.8B
- Adj EPS
- USD 2.54
- Adj op margin
- 0.1
Q3 / FY26 guidance
- Q3 revenue low
- USD 5.3B
- Q3 revenue high
- USD 5.5B
- FY26 revenue (raised)
- USD 20.5B
- FY26 adj EPS (raised)
- USD 11.3
Thesis
Celestica’s AI infrastructure role is AI server ODM + liquid-cooling rack systems — the “middle layer” from NVIDIA GPU to data-center delivery. Q2 2026 (ended 2026-06-30) validated that mix with $4.70B revenue (+62%) and CCS $3.81B (+84%). A full FY26 raise to $20.5B revenue and $11.30 adj EPS shows AI rack order visibility is still improving.
The premium holds only if:
- AI rack deployment scale keeps expanding — OpenAI Stargate and other mega-projects need turnkey ODM capability; Celestica is one of few tier-1 EMS players with GPU rack + liquid cooling + system integration;
- Liquid cooling goes from option to necessity — rising Blackwell-and-beyond GPU TDP makes air cooling inadequate; direct-to-chip / rack-level liquid cooling is CLS’s differentiator;
- Margin improvement path — adj op margin repaired from FY25 lows to Q2 8.2% and FY26 guide 8.4%, proving mix improvement and scale leverage.
But CLS is fundamentally manufacturing — adj op margin ~8% is not comparable to Broadcom’s 69% EBITDA or Credo’s 68% GM. ODM share battle vs Super Micro is the core competitive variable.
Business
Model: EMS/ODM; CCS hosts AI servers and liquid-cooled racks; ATS buffers non-AI end markets.
Flagships: AI server / liquid-cool rack ODM; cooling integration; ATS base.
Competitiveness: Scale/yield; long hyperscaler/Cisco manufacturing ties.
Strategy: Rising CCS AI mix; share fights vs SMCI on mega-projects.
Value chain
Mid/downstream ODM/EMS from GPU reference designs to deliverable racks.
Upstream: NVDA refs, components, cooling. Downstream: hyperscalers/enterprise. Risks: GPU allocation; manufacturing margin ceiling.
Valuation
AI ODM themes drove a significant 2026 re-rating. As of this note (2026-07-30), valuation already prices part of the FY26 $20.5B path. Manufacturing low-margin reality caps multiples below fabless semis, but AI order visibility provides re-rating room.
Valuation frame
| Metric | Status | Read |
|---|---|---|
| 盈利增长 | 强劲加速 | Q2 +62%；CCS +84% |
| 运营利润率 | 改善中 | Adj op margin 8.2% → FY26 8.4% |
| 估值 | 重估中 | AI ODM 叙事推动 re-rating |
| 相对 SMCI | 竞争加剧 | OpenAI rack 项目争夺 |
| 客户集中度 | 中等偏高 | hyperscaler + AI lab 项目驱动 |
| AI CapEx 周期 | 敏感 | 机柜订单与 GPU 出货高度相关 |
Versus SMCI: direct competition for AI server ODM share; OpenAI rack program allocation is the key variable. SMCI leans “white-box server”; CLS leans “turnkey rack + liquid cooling” — differentiation is integration depth. Versus Vertiv: VRT does data-center infrastructure (power / cooling); CLS does rack-level ODM — complementary in the chain.
Financial trend (~24 months)
Eight-quarter revenue and gross margin with YoY and QoQ. Semi/AI hardware seasonality is secondary to supply, ASP, and order timing.
Revenue · last 8 quarters
Interactive chart available in the reader.
Gross margin · last 8 quarters
Interactive chart available in the reader.
Operations
Q2 2026 operations
Q2 P&L and segments
| Item | Q2 2026 | Note |
|---|---|---|
| 营收 | $4.70B（+62%） | Q2 截至 2026-06-30 |
| CCS（通信与云） | $3.81B（+84%） | AI server ODM 主力 |
| ATS（先进科技） | $0.89B（+8%） | 航空 / 工业 / 健康 |
| Adj EPS | $2.54 | — |
| GAAP EPS | $3.17 | 含一次性收益 |
| Adj 运营利润率 | 8.2% | 较 FY25 改善 |
Segment mix
| Segment | Revenue mix | Watchpoint |
|---|---|---|
| CCS（通信与云） | ~81% | Q2 $3.81B；+84% YoY；AI ODM |
| ATS（先进科技） | ~19% | Q2 $0.89B；+8% YoY；航空 / 工业 |
| AI Server（CCS 内） | ~60%+ | GPU 机柜 / 液冷 / rack 系统 |
Takeaways:
- CCS ~81% of revenue, with AI Server ~60%+ of CCS — AI is no longer incremental; it is the CCS core.
- ATS +8% YoY provides base business (aerospace, industrial, health), dampening full-company AI-cycle volatility.
- Adj op margin 8.2% improved materially vs FY25, but absolute level remains manufacturing-band — do not price CLS like fabless semis.
AI server ODM
Celestica’s AI business spans:
- GPU rack design and manufacturing — custom rack systems based on NVIDIA GPU reference designs; direct competition with SMCI.
- Liquid-cooling systems — direct-to-chip and rack-level liquid cooling is the key Blackwell-era differentiator; complements Vertiv facility-level cooling.
- Turnkey delivery — one-stop ODM from component sourcing to rack assembly, test, and delivery.
AI rack deployment chain: NVDA GPU → CLS ODM rack → CRDO AEC connectivity → AVGO network switching → Vertiv data-center infrastructure. CLS is the critical middle layer from GPU to data center.
Watch CCS quarterly revenue and QoQ slope, OpenAI / hyperscaler rack announcements, liquid-cooling penetration, adj op margin improvement slope, and share shifts vs SMCI.
Competition
Strategy / product / risk map
| Category | Detail | Implication |
|---|---|---|
| AI Server ODM | GPU 机柜设计 / 制造 / 交付 | CCS +84% 核心驱动 |
| 液冷系统 | direct-to-chip / rack-level liquid cooling | 高功率 GPU 必需；vs Vertiv |
| OpenAI rack 项目 | Stargate / 大规模 AI 基础设施 | 订单能见度关键 |
| 竞争 | Super Micro ODM 直接竞争 | 份额争夺 + margin 压力 |
| 产业链 | NVDA GPU → CLS 机柜 → CRDO 互联 | AI 基础设施一环 |
| 估值 | AI ODM re-rating | margin 改善 vs 低 margin 制造业折价 |
Three axes:
| Axis | Celestica | SMCI | Vertiv |
|---|---|---|---|
| Role | Turnkey rack ODM + liquid cooling | White-box AI server | Data-center power / cooling |
| Q2 growth | CCS +84% | AI systems hyper-growth | Data center ~+20% band |
| Margin | Adj op ~8% | Op ~8–10% | Op ~15% |
| Edge | Liquid cooling + system integration | Speed + cost | Infrastructure scale |
CLS vs SMCI competition will intensify on OpenAI Stargate and other mega-projects — whoever wins more share gets scale leverage and margin improvement. But ODM is inherently low-margin; accept that reality.
Peer comparison
| Company | Share / role | GM | Strength | Weakness |
|---|---|---|---|---|
| Celestica (self) | AI rack ODM | Adj OM ~8% | Scale + liquid cooling | Manufacturing margins |
| Super Micro | Custom AI servers | ~15% | Speed / DLC narrative | Governance discount |
| Vertiv | DC power / cooling | Adj OM ~23% | Facility infra scale | Not full rack ODM |
Management
CEO Rob Mionis and CFO Mandeep Chawla long-tenured. No material 24m change. Stability: steady.
Key management (24m)
| Role | Name | Since | 24m change |
|---|---|---|---|
| CEO | Rob Mionis | 2015 | No change |
| CFO | Mandeep Chawla | 2017 | No change |
| Chair | Tawfiq Popatia / board | — | No material disclosed C-suite turnover |
Outlook
Company guide · Q3 / FY2026
| Item | Guide | Note |
|---|---|---|
| Q3 营收 | $5.25–5.55B | 延续加速 |
| Q3 Adj EPS | $2.88–3.08 | — |
| FY26 营收（上修） | $20.5B | 较此前指引上调 |
| FY26 Adj EPS（上修） | $11.30 | — |
| FY26 FCF | $600M | capex 投入期 |
| FY26 Adj op margin | 8.4% | 较 FY25 改善 |
Framework:
- Q3 revenue $5.25–5.55B vs Q2 $4.70B implies ~+12–18% QoQ — AI rack pipeline remains full.
- FY26 $20.5B raise implies H2 acceleration; $11.30 adj EPS maps to ~8.4% op margin with a clear improvement path.
- FCF $600M reflects capex investment phase — ODM capacity expansion requires upfront spend; FCF lags earnings growth.
- OpenAI / hyperscaler rack program progress is the H2 key catalyst.
Scenarios
| Scenario | Conditions | Implication |
|---|---|---|
| Bull | Q3 >$5.55B; OpenAI rack mega-wins; margin >8.4%; liquid-cooling penetration accelerates | AI ODM re-rating extends |
| Base | Q3 roughly delivers; FY26 $20.5B path; margin ~8.4% | Hold; watch SMCI competition |
| Bear | Q3 miss; OpenAI project delay; SMCI takes share; margin compresses | 15–25% drawdown possible |
Positioning frame (research only): AI infrastructure ODM theme; accept manufacturing margin reality. Track CCS QoQ slope, OpenAI rack progress, liquid-cooling penetration, share vs SMCI.