Celestica: The Under-the-Radar Powerhouse Fueling the 800G Data Center Revolution

In the shadow of tech giants like Jabil and Sanmina, Celestica (CLS) has quietly emerged as a linchpin in the global transition to 800G Ethernet infrastructure. While its market share in the broader technology sector remains modest—2.88% as of Q1 2025Celestica Inc Market share relative to its competitors, as of Q2 2025^[1]—the company's dominance in the 800G switching space is nothing short of extraordinary. According to a report by Dell'Oro Group, Celestica shipped over 1.6 million 800Gbps-based ports in Q1 2025, securing the highest share gain in the quarter and retaining leadership in this high-growth segmentCelestica Achieves Key Milestones in Market Share and Growth^[3]. This momentum has translated into an 82% year-over-year surge in 800G platform revenue in Q2 2025, a figure that now matches 400G in volume and is poised to outpace it in the second half of the yearCelestica Achieves Key Milestones in Market Share and Growth^[3].

A Strategic Edge in Open Networking and AI Optimization

Celestica's success stems from its dual focus on open networking standards and AI-optimized hardware. Its DS5000 800G switch, launched in 2023, exemplifies this approach. With 51.2 Tbps of switching capacity across 64 OSFP 800GbE ports in a compact 2U form factor, the DS5000 is tailored for hyperscale data centers and AI/ML workloadsCelestica Achieves Key Milestones in Market Share and Growth^[3]. By supporting open standards like ONIE and SONiC, Celestica offers customers flexibility in software deployment, a critical differentiator in an era where hyperscalers demand interoperability and cost efficiencyPowering the Next Wave: A Closer Look at the DS5000^[4].

This strategy has resonated with major cloud providers. Management confirmed in Q2 2025 that “every 400G customer has transitioned to 800G,” and hyperscalers are now eyeing next-gen 1.6Tbps platforms powered by silicon like Broadcom's Tomahawk 6Celestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2]. Celestica's design-in success with these clients has created a flywheel effect: as AI workloads intensify, demand for 800G infrastructure grows, further solidifying Celestica's position.

Competitive Positioning: Underestimated but Resilient

Despite its achievements, Celestica remains an underdog in the 800G space. Its 2.59% 12-month trailing market share in the segment lags behind Jabil's 9.26% and Sanmina's 2.55%Celestica Inc Market share relative to its competitors, as of Q2 2025^[1]. However, this apparent gap masks a critical advantage: Celestica's revenue concentration in high-margin, high-growth areas. For Q2 2025, its Communications and Cloud Solutions (CCS) segment—driven by 800G networking—accounted for 72% of total revenue, up 28% year-over-yearCelestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2]. By contrast, competitors like Jabil and Sanmina spread their efforts across more diversified but slower-growing markets.

Analysts highlight Celestica's capacity readiness as another key strength. The company has expanded manufacturing in Thailand, Mexico, and Texas to meet surging demandCelestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2], ensuring it can scale alongside hyperscalers without the bottlenecks that plagued rivals during the 400G transition. This operational discipline, combined with a disciplined capital allocation strategy, has enabled Celestica to raise its 2025 revenue guidance to $11.55 billion—a 21% year-over-year increaseCelestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2].

Financials and Future Outlook

Celestica's Q2 2025 results underscore its financial resilience. Revenue hit $2.89 billion, with HPS (Hardware Platform Solutions) networking revenue surging 82% year-over-yearCelestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2]. The company's adjusted operating margin reached 7.4%, up 110 basis points from the prior year, reflecting improved economies of scaleCelestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2]. These metrics have not gone unnoticed: Celestica's stock has outperformed peers in 2025, with Wall Street betting on its role in the AI infrastructure boom.

Looking ahead, Celestica's visibility into 1.6T platforms and silicon partnerships positions it to benefit from the next phase of the transition. Management expects 1.6T revenue to materialize in late 2026, with hyperscalers already testing prototypesCelestica (CLS) Q2 2025: 800G Networking Ramps 82%, Driving Growth^[2]. Given the structural shift toward AI-native data centers, this pipeline could drive another round of growth, particularly as Celestica's open networking model aligns with hyperscalers' cost-reduction goals.

Conclusion: A Hidden Gem in the AI Infrastructure Race

Celestica's under-the-radar positioning belies its outsized influence in the 800G transition. While it may lack the brand recognition of industry heavyweights, its focus on open, AI-optimized solutions and strategic manufacturing expansions have made it a critical enabler of the next-generation data center. For investors, Celestica represents a compelling case study: a company leveraging niche expertise to dominate a high-growth segment, with a clear path to capitalize on the AI revolution.