Celestica slips despite $300M Texas expansion

Toronto-based Celestica saw its share price fall from a June peak of $655 to about $524 in recent trading, despite announcing a $300 million investment in Texas and raising its 2026 outlook.

The company plans to extend leases at existing Texas facilities and add a new 343,000-square-foot program. The $300 million will be deployed over the next two years to support production of servers, storage and networking equipment for large customers.

Celestica reported first-quarter revenue of $4.05 billion, an increase of 53% year over year and near the top of its prior guidance range. Revenue growth was led by the Connectivity & Cloud Solutions unit, which includes server and storage products.

Management raised its 2026 guidance to $19.0 billion in revenue and $10.15 in adjusted earnings per share. Rob Mionis, chief executive, stated: “We continue to see accelerating growth from our CCS customer base, alongside increasing profitability in both our CCS and ATS segments. Driven by this momentum, we are raising our 2026 annual outlook to $19.0 billion in revenue and $10.15 in adjusted EPS.”

Analysts expect 2026 revenue near $19.19 billion and have projected revenue could reach roughly $26 billion in 2027. Forecasts also call for adjusted EPS to rise from about $6.05 last year to around $10 in 2026 and near $15 in 2027.

Major cloud and hyperscale customers, including Alphabet, Meta Platforms, Microsoft, Amazon and Cisco, have increased infrastructure spending. Alphabet has signaled a substantial rise in AI-related capital expenditures, which supports demand for TPUs, racks and high-speed networking gear supplied by Celestica.

Technical indicators show the stock’s retreat accelerated after a large chipmaker’s earnings report weighed on AI-related names. Chart patterns point to a head-and-shoulders formation with a neckline near $473. The share price is trading just above its 50-day exponential moving average at about $517; a sustained move below that average would be seen by technicians as confirming the pattern and could expose a $400 support area. A move above roughly $580 would negate the pattern.

The company continues to cite hyperscaler spending as the driver of multi-year growth for its CCS business, while market volatility has affected near-term share-price action.