Celestica Shares Dive 6.19% on Trade War Fears AI Sector Uncertainty

Celestica Inc. (CLS) shares plunged 6.19% intraday on October 10, 2025, hitting a trough unseen since October 2025, as renewed trade tensions and sector-wide pessimism weighed on investor sentiment. The selloff reflected broader market anxieties over President Trump’s proposed 25% vehicle import tariffs, which amplified fears of a global trade war and spurred risk-off behavior across tech-heavy assets.

The AI sector, a critical driver of Celestica’s Connectivity and Cloud Solutions segment, faced heightened scrutiny following Alibaba’s Joe Tsai warning of an industry “bubble.” This prompted investors to reassess long-term growth assumptions, disproportionately impacting AI-linked stocks. Despite robust Q2 2025 earnings—surpassing estimates with $1.39 per share and 21% annual revenue growth—Celestica’s stock remained vulnerable to macroeconomic headwinds and sector-specific doubts.

Analyst activity further fueled volatility. TD Securities downgraded the stock to “Hold” in late September, citing cautious near-term outlooks, while other firms maintained a “Moderate Buy” consensus. Institutional investors displayed divergent signals: some reduced exposure post-downgrade, while others increased holdings, signaling a split between short-term caution and long-term confidence in Celestica’s AI and connectivity positioning.

The company’s high beta of 1.88 amplified its sensitivity to market swings, with sharp declines outpacing broader index drops. However, Celestica’s raised FY 2025 guidance and institutional accumulation suggest underlying resilience. Analysts like BNP Paribas and Barclays highlighted its strategic alignment with AI infrastructure growth, though near-term risks—such as tariff-driven cost pressures—remain unresolved.