Celestica’s Communications and Cloud Solutions (CCS) segment recorded a 22% year-over-year increase in order intake during the first three quarters of fiscal 2025, driven primarily by hyperscale data center operators ramping AI compute deployments. Management highlighted that three major cloud customers each increased their committed volume by more than 30% sequentially in Q3. New packaging and cooling rack designs for high-performance GPUs have contributed 12% of incremental CCS revenues, with shipments to two North American AI pioneers commencing in November.

In December, Celestica introduced its third-generation 400-gigabit Ethernet switch platform, co-designed with a leading network silicon vendor. Initial production orders for this platform total 18,000 units over the next 12 months, representing approximately US$120 million in contracted hardware value. The company’s CCS backlog expanded by US$85 million during Q4, reflecting both new switch awards and renewal of existing design wins across four telecom equipment manufacturers.

For fiscal Q4, Celestica reiterated guidance for consolidated revenues of US$2.2 billion to US$2.3 billion, with the CCS segment expected to contribute roughly 35%, up from 31% in Q3. Management forecasts segment gross margin will improve by 120 basis points sequentially, supported by higher factory utilization and pricing adjustments on select AI compute modules. Analysts’ consensus for non-GAAP operating margin of 4.8% could be beaten if CCS growth sustains current momentum, a dynamic that may prompt several firms to raise their targets following the January 28 earnings release.