Celestica reported third-quarter 2026 revenue of $5.83 billion, up 83% year over year, as demand for hyperscale AI networking and compute hardware accelerated. The company raised its 2026 revenue outlook to $21.0 billion and introduced a 2027 revenue forecast of $40.0 billion, approximately 90% above the 2026 outlook.

Connectivity & Cloud Solutions (CCS) revenue reached $4.87 billion, up 102%, while Hardware Platform Solutions generated approximately $2.3 billion, up 70%. Non-GAAP adjusted operating margin reached a record 8.5%, with adjusted EPS of $3.30. The company identified 800G and 1.6T networking and AI compute programs as growth drivers.

For 2027, Celestica expects adjusted EPS of $21.50, adjusted operating margin of 9.0%, and capital expenditures of $1.5 billion to $2.0 billion. Management said customer demand forecasts for 2028 are meaningfully higher than the 2027 outlook, without providing formal 2028 revenue guidance. Its 2026 free cash flow outlook was reduced to $460 million from $600 million amid working-capital investment.

Analysis: AI Infrastructure Spending Is Translating into Hardware Revenue

Celestica’s results provide a measurable indicator of how hyperscaler and AI infrastructure investment is translating into demand for networking equipment, compute platforms, and advanced manufacturing capacity. The company’s Connectivity & Cloud Solutions business now accounts for approximately 84% of quarterly revenue, reflecting rapid expansion in cloud and data center infrastructure. Demand for 800G and emerging 1.6T networking platforms is supporting this growth as hyperscalers deploy larger GPU clusters requiring higher bandwidth, greater port density, and more sophisticated network fabrics. Celestica’s planned $1.5 billion to $2.0 billion in 2027 capital expenditures underscores the manufacturing investments required to support these deployments.

The company’s $40 billion revenue forecast for 2027, nearly double its updated 2026 outlook, points to continued expansion in AI infrastructure spending beyond the current year. Management also reports that customer demand forecasts for 2028 are meaningfully higher, although these projections are not firm revenue commitments. The financial implications of this expansion are already visible: Celestica reduced its 2026 free cash flow outlook by $140 million to accommodate additional working capital requirements. For the broader AI infrastructure ecosystem, the results highlight how accelerating demand for networking and compute hardware is driving substantial investment across the manufacturing supply chain, with execution, capacity expansion, and component availability becoming increasingly important to meeting hyperscaler deployment schedules.