Celestica Shares Drop 8% as Google Shifts TPU Assembly to Other Suppliers
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 22 2026
0mins
Source: seekingalpha
- Stock Decline: Celestica shares fell nearly 8% on Thursday following Digitimes' report that Google is shifting its L10-L11 TPU server assembly orders to other suppliers, raising concerns about future orders and revenue.
- Order Shift Impact: Google has expanded assembly orders to Inventec and other Taiwanese manufacturers, previously handled by Celestica, which could directly affect Celestica's revenue and market share in the competitive AI server market.
- Earnings Outlook: Celestica anticipates $16 billion in revenue and $8.20 EPS by 2026, despite the risk of reduced orders, as it continues to expand its AI data center offerings to meet growing market demand.
- Market Reaction: Celestica reported a non-GAAP EPS of $1.58, beating estimates by $0.09, with revenue of $3.19 billion exceeding expectations by $150 million; however, the shift in orders has dampened market confidence in its growth prospects.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy CLS?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on CLS
Wall Street analysts forecast CLS stock price to rise
8 Analyst Rating
7 Buy
1 Hold
0 Sell
Strong Buy
Current: 385.390
Low
330.00
Averages
387.38
High
440.00
Current: 385.390
Low
330.00
Averages
387.38
High
440.00
About CLS
Celestica Inc. is a Canada-based company. It is engaged in designing, manufacturing and providing hardware platform and supply chain solutions. It delivers supply chain solutions globally to customers in two operating segments: Advanced Technology Solutions (ATS) and Connectivity & Cloud Solutions (CCS). The ATS segment consists of its ATS end market and comprises its Aerospace & Defense (A&D), Industrial, HealthTech, and Capital Equipment businesses. Its Capital Equipment business comprises semiconductor and display businesses. The CCS segment consists of its communications and enterprise end markets. The enterprise end market consists of Celestica’s servers and storage businesses. It offers a range of product manufacturing and related supply chain services to customers in both of its segments, including design and development, new product introduction, engineering services, component sourcing, electronics manufacturing and assembly, testing, systems integration, among others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Celestica Capitalizes on Strong AI Data Center Demand
- Strong Demand Driving Growth: Celestica is benefiting from robust demand in AI data centers, which is expected to drive revenue growth in the coming quarters, particularly as the company shifts towards higher-value networking and rack-level systems.
- Enhanced Guidance: The company has provided stronger performance guidance, indicating its competitive position and growth potential in the market, which may attract more investor interest in its long-term development.
- Stock Price Volatility Impact: Despite the optimistic growth outlook, the stock price experienced significant volatility on May 2, 2026, prompting investors to pay close attention to valuation levels and their implications for future earnings.
- Customer Concentration Risk: With increasing customer concentration, Celestica faces execution risks that could impact its flexibility and adaptability in a rapidly changing market environment.
See More
Celestica Stock Soars 345% Driven by AI Investments
- Significant Revenue Growth: Celestica's connectivity and cloud solutions segment accounted for 80% of total revenue in Q1, with a 76% year-over-year increase, driving an overall revenue growth of 53% to $4.05 billion, showcasing the company's strong performance in AI data center infrastructure development.
- New Client Partnerships: In Q1, Celestica secured two new programs, including designing and manufacturing networking switches for AMD's Helios architecture, with initial deliveries expected by year-end, which will further enhance the company's revenue and profitability.
- Upward Earnings Guidance: The company raised its full-year revenue guidance from $17 billion to $19 billion, reflecting a 53% increase, while also adjusting its adjusted EPS forecast from $8.75 to $10.15, indicating strong confidence in future profitability.
- Robust Market Demand: With global data center spending projected to reach $7 trillion by 2030, demand for Celestica's electronics manufacturing services is expected to continue growing, potentially driving further stock price increases and attracting investor interest.
See More
Latest Wall Street Rating Updates
- Apple's Positive Outlook: Bank of America reiterates a buy rating on Apple, forecasting that iPhone revenues will exceed expectations in 2026 due to record upgraders and strong gross margins despite commodity pressures, indicating sustained competitiveness in the smartphone market.
- Roblox Demand Slowdown: Bank of America downgrades Roblox to neutral, citing a significant decline in platform demand; while acknowledging its ability to compress development costs, the uncertainty around the timeline for demand recovery may impact its market performance.
- CoreWeave Growth Potential: Citi reiterates CoreWeave as a buy, raising its price target from $126 to $155, estimating a quarterly growth of 35-40% in AI infrastructure, showcasing strong performance across a diversified customer base.
- Hershey's Positive Outlook: TD Cowen upgrades Hershey to buy, expressing confidence that the company will raise its 2026 guidance and return to volume growth in 2027, reflecting strong recovery potential in the confectionery market.
See More
Celestica Reports Strong Q1 2026 Earnings Exceeding Expectations
- Significant Revenue Growth: Celestica reported Q1 2026 revenue of $4.05 billion, a 53% year-over-year increase, demonstrating the company's strong performance in the electronic manufacturing services sector and solidifying its market leadership.
- Adjusted EPS Exceeds Expectations: The company achieved an adjusted EPS of $2.16, surpassing guidance and reflecting an 80% year-over-year growth, which not only indicates improved profitability but also boosts investor confidence in future performance.
- Upward Revision of Full-Year Outlook: Celestica raised its full-year 2026 revenue outlook from $17 billion to $19 billion, reflecting a 53% growth, while also increasing its adjusted EPS forecast from $8.75 to $10.15, showcasing optimism regarding future market demand.
- Supply Chain Challenges: Despite strong performance, Celestica faces component shortages in custom silicon and memory, which could impact its ability to meet demand, necessitating careful management to align production with market needs.
See More
CELESTICA INC: JP MORGAN INCREASES TARGET PRICE FROM $410 TO $425
- Target Price Increase: JP Morgan has raised the target price for Celestica to $425 from $410.
- Market Implications: This adjustment reflects JP Morgan's positive outlook on Celestica's performance in the market.
See More
Stock Market Declines on OpenAI Fears and Rising Oil Prices
- Market Volatility Drivers: The stock market experienced a decline at the open due to fears surrounding OpenAI and rising oil prices, reflecting investor caution towards tech stocks, which could impact overall market sentiment and investment decisions.
- AI Stocks Performance: Despite the overall market downturn, AI stocks like Seagate and Bloom Energy showed strong performance following earnings reports, indicating robust growth potential driven by technological innovation and market demand.
- Oil Price Impact: The rise in oil prices not only exacerbates market uncertainty but may also lead to increased inflationary pressures, potentially affecting consumer spending and corporate profits, further influencing stock market performance.
- Investor Sentiment Shifts: Although the market faced significant losses at the open, it managed to pare losses later, suggesting that investors are still seeking opportunities amid uncertainty, which could lead to short-term market fluctuations.
See More
Celestica Capitalizes on Strong AI Data Center Demand
- Strong Demand Driving Growth: Celestica is benefiting from robust demand in AI data centers, which is expected to drive revenue growth in the coming quarters, particularly as the company shifts towards higher-value networking and rack-level systems.
- Enhanced Guidance: The company has provided stronger performance guidance, indicating its competitive position and growth potential in the market, which may attract more investor interest in its long-term development.
- Stock Price Volatility Impact: Despite the optimistic growth outlook, the stock price experienced significant volatility on May 2, 2026, prompting investors to pay close attention to valuation levels and their implications for future earnings.
- Customer Concentration Risk: With increasing customer concentration, Celestica faces execution risks that could impact its flexibility and adaptability in a rapidly changing market environment.
See More
Celestica Stock Soars 345% Driven by AI Investments
- Significant Revenue Growth: Celestica's connectivity and cloud solutions segment accounted for 80% of total revenue in Q1, with a 76% year-over-year increase, driving an overall revenue growth of 53% to $4.05 billion, showcasing the company's strong performance in AI data center infrastructure development.
- New Client Partnerships: In Q1, Celestica secured two new programs, including designing and manufacturing networking switches for AMD's Helios architecture, with initial deliveries expected by year-end, which will further enhance the company's revenue and profitability.
- Upward Earnings Guidance: The company raised its full-year revenue guidance from $17 billion to $19 billion, reflecting a 53% increase, while also adjusting its adjusted EPS forecast from $8.75 to $10.15, indicating strong confidence in future profitability.
- Robust Market Demand: With global data center spending projected to reach $7 trillion by 2030, demand for Celestica's electronics manufacturing services is expected to continue growing, potentially driving further stock price increases and attracting investor interest.
See More
Latest Wall Street Rating Updates
- Apple's Positive Outlook: Bank of America reiterates a buy rating on Apple, forecasting that iPhone revenues will exceed expectations in 2026 due to record upgraders and strong gross margins despite commodity pressures, indicating sustained competitiveness in the smartphone market.
- Roblox Demand Slowdown: Bank of America downgrades Roblox to neutral, citing a significant decline in platform demand; while acknowledging its ability to compress development costs, the uncertainty around the timeline for demand recovery may impact its market performance.
- CoreWeave Growth Potential: Citi reiterates CoreWeave as a buy, raising its price target from $126 to $155, estimating a quarterly growth of 35-40% in AI infrastructure, showcasing strong performance across a diversified customer base.
- Hershey's Positive Outlook: TD Cowen upgrades Hershey to buy, expressing confidence that the company will raise its 2026 guidance and return to volume growth in 2027, reflecting strong recovery potential in the confectionery market.
See More
Celestica Reports Strong Q1 2026 Earnings Exceeding Expectations
- Significant Revenue Growth: Celestica reported Q1 2026 revenue of $4.05 billion, a 53% year-over-year increase, demonstrating the company's strong performance in the electronic manufacturing services sector and solidifying its market leadership.
- Adjusted EPS Exceeds Expectations: The company achieved an adjusted EPS of $2.16, surpassing guidance and reflecting an 80% year-over-year growth, which not only indicates improved profitability but also boosts investor confidence in future performance.
- Upward Revision of Full-Year Outlook: Celestica raised its full-year 2026 revenue outlook from $17 billion to $19 billion, reflecting a 53% growth, while also increasing its adjusted EPS forecast from $8.75 to $10.15, showcasing optimism regarding future market demand.
- Supply Chain Challenges: Despite strong performance, Celestica faces component shortages in custom silicon and memory, which could impact its ability to meet demand, necessitating careful management to align production with market needs.
See More
CELESTICA INC: JP MORGAN INCREASES TARGET PRICE FROM $410 TO $425
- Target Price Increase: JP Morgan has raised the target price for Celestica to $425 from $410.
- Market Implications: This adjustment reflects JP Morgan's positive outlook on Celestica's performance in the market.
See More
Stock Market Declines on OpenAI Fears and Rising Oil Prices
- Market Volatility Drivers: The stock market experienced a decline at the open due to fears surrounding OpenAI and rising oil prices, reflecting investor caution towards tech stocks, which could impact overall market sentiment and investment decisions.
- AI Stocks Performance: Despite the overall market downturn, AI stocks like Seagate and Bloom Energy showed strong performance following earnings reports, indicating robust growth potential driven by technological innovation and market demand.
- Oil Price Impact: The rise in oil prices not only exacerbates market uncertainty but may also lead to increased inflationary pressures, potentially affecting consumer spending and corporate profits, further influencing stock market performance.
- Investor Sentiment Shifts: Although the market faced significant losses at the open, it managed to pare losses later, suggesting that investors are still seeking opportunities amid uncertainty, which could lead to short-term market fluctuations.
See More
