Celestica Inc. (Celestica) delivers innovative supply chain solutions globally to customers.
The company is a corporation domiciled in the Province of Ontario, Canada, and operates under the Business Corporations Act (Ontario) (OBCA).
Segments
The company operates through two operating and reporting segments: Advanced Technology Solutions (ATS) and Connectivity and Cloud Solutions (CCS).
The company’s ATS segment consists of its ATS end market, and is consisted of its aerospace and defense (...
Celestica Inc. (Celestica) delivers innovative supply chain solutions globally to customers.
The company is a corporation domiciled in the Province of Ontario, Canada, and operates under the Business Corporations Act (Ontario) (OBCA).
Segments
The company operates through two operating and reporting segments: Advanced Technology Solutions (ATS) and Connectivity and Cloud Solutions (CCS).
The company’s ATS segment consists of its ATS end market, and is consisted of its aerospace and defense (A&D), Industrial, HealthTech, and Capital Equipment businesses. The company’s Capital Equipment business is consisted of its semiconductor and display businesses. The company’s CCS segment consists of its Communications and Enterprise end markets. The company’s Enterprise end market is consisted of its servers and storage businesses.
The company’s customers include original equipment manufacturers (OEMs), cloud-based and other service providers, including hyperscalers, and other companies in a wide range of industries. The company’s global headquarters is located in Toronto, Ontario, Canada. It operates a network of sites and centers of excellence, strategically located in North America, Europe, and Asia, with specialized end-to-end supply chain capabilities tailored to meet specific market and customer product lifecycle requirements.
The company offers a comprehensive range of product manufacturing and related supply chain services to customers in both of its segments, including design and development, new product introduction, engineering services, component sourcing, electronics manufacturing and assembly, testing, complex mechanical assembly, systems integration, precision machining, order fulfillment, logistics, product licensing, and after-market repair and return, and IT asset management and disposition (ITAM/ITAD) services. The company’s Hardware Platform Solutions (HPS) offering, within its CCS segment, includes the development of infrastructure platforms, hardware and software design solutions, including open-source software that complements its hardware offerings, and services that can be used as-is, or customized for specific applications in collaboration with its customers, and management of program design and aspects of the supply chain, manufacturing, and after-market support, including ITAM/ITAD.
The company depends on a small number of customers for a substantial portion of its revenue. In the aggregate, its top 10 customers represented 73% of total revenue for 2024. In 2024, two customers (each in the company’s CCS segment) individually represented 10% or more of total revenue in 2024 (28% and 11%, respectively).
Products and services in the company’s ATS segment are extensive and are often more regulated than in its CCS segment, and can include the following: government-certified and highly-specialized manufacturing, electronic and enclosure-related services for A&D customers; high-precision semiconductor and display equipment and integrated subsystems; a wide range of industrial automation, controls, test and measurement devices; engineering-focused engagements, including in the areas of telematics, human machine interface, Internet-of-Things, and embedded systems; advanced solutions for surgical instruments, diagnostic imaging, and patient monitoring; and efficiency products to help manage and monitor the energy and power industries. Products and services in the company’s CCS segment consist predominantly of enterprise-level data communications and information processing infrastructure products and systems, and can include routers, switches, data center interconnects, edge solutions, servers, and storage-related products used by a wide range of businesses and cloud-based and other service providers to manage digital connectivity, commerce, and social media applications.
The company’s ATS segment businesses typically have higher margin profiles and margin volatility, higher working capital requirements, lower volumes, and longer product lifecycles than the traditional businesses in its CCS segment. Within the company’s CCS segment, however, its HPS business (which includes firmware/software enablement across all primary IT infrastructure data center technologies, open-source software offerings that complement its hardware platforms, and after-market services, including ITAM/ITAD) typically has a higher margin profile than its traditional CCS businesses, but also requires specific investments (including research and development (R&D)) and higher working capital. The company’s CCS segment experiences a high degree of volatility in terms of revenue and product/service mix, and as a result, its CCS segment margin can fluctuate from period to period.
Within both of the company’s segments, it is focused on increased penetration in its end markets; diversifying its customer mix and product portfolios, including increasing design and development, engineering, and after-market services (higher value-added services); and diversifying its capabilities and supply chain. The company intends to continue to expand its business by growing its CCS segment, focusing on its HPS business, high-value EMS programs (including with hyperscalers), and services, and by continuing to pursue new customers and acquisition opportunities in both of its segments.
Celestica is increasingly engaged as an ODM by the company’s customers. As part of Celestica's ODM offerings, it designs and manufactures products, either as customized solutions, white box solutions, or under Joint Design and Manufacturing (JDM) engagements in collaboration with its customers. This business is primarily within its HPS business.
Strategy
The company’s strategies are to increase penetration in its end markets/offerings; selectively pursue acquisitions and strategic transactions; develop and grow trusted relationships with leading customers; expand the range of service offerings, and continue to invest in engineering and supply chain solutions and services; and enhance its capabilities in R&D, new technology development, quality products, and design to support its HPS business.
Celestica's Business
Innovative Supply Chain Solutions and Services
The company is a global provider of innovative supply chain solutions. It offers a range of services, including design and development, engineering services, supply chain management, new product introduction, component sourcing, electronics manufacturing, assembly, testing, complex mechanical assembly, systems integration, precision machining, order fulfillment, logistics, product licensing, and after-market repair and return, and ITAM/ITAD services. The company’s design and development services include its HPS offering, which consists of developing infrastructure platforms, hardware and software design solutions, including open-source software that complements its hardware offerings, and services in collaboration primarily with CCS segment customers, as well as managing aspects of the supply chain and manufacturing, including firmware/software enablement across all primary IT infrastructure data center technologies, and after-market support, including ITAM/ITAD. The company’s HPS offering helps to differentiate it from other EMS providers, by encompassing advanced technology design solutions that customers can tailor to their specific platform applications. It executes its business in its global network of sites, including its designated centers of excellence, strategically located in North America, Europe, and Asia. The company leverages these sites and centers of excellence, IT, and its supply chain expertise using collaborative processes and a team of highly skilled, customer-focused employees. The company’s ability to deliver a range of supply chain and hardware solutions to its customers provides them with a competitive lead time, and advantages in quality, flexibility, and total cost of ownership.
Quality, Lean, and Six Sigma Culture
The company’s key strengths, compared to its competitors, are its ability to consistently deliver high-quality services and products. It maintains a robust quality management system focusing on continuous process improvements and ensuring high levels of customer satisfaction. In order to be successful, the company employs advanced statistical engineering techniques and other tools designed to enhance production and service quality. The company’s principal sites are ISO 9001 and ISO 14001 certified, adhering to international quality management standards and equipped with necessary industry-specific certifications.
The company’s Celestica Operating System (COS) consists of the application of global standard processes to all critical aspects of its operations, including quality, supply and operations planning, new product introduction, daily visual performance management, and continuous operational improvement through a ‘Plan Do Check Adjust’ cycle. The COS is intended to improve cost productivity, create accountable teams, and assure consistent performance.
In addition to these standards, the company deploys Lean initiatives to help drive manufacturing efficiencies, cycle time velocities, and improved product quality, and uses Six Sigma extensively in an effort to reduce process variation and to drive root cause problem-solving. Lean and Six Sigma methods are also used in non-production areas to streamline its processes and eliminate waste. The company applies the knowledge it gains in its after-market services to help improve the quality and reliability of next-generation products.
Design and Engineering Services
The company’s global design teams are focused on delivering flexible solutions and expertise, intended to help customers reduce overall product costs, improve time-to-market, introduce competitively differentiated products, and drive hardware innovations. For customer-owned designs, the company augments their design teams, and utilizes its proprietary design analysis tools to minimize design revisions and to achieve improved manufacturing yields. The company’s HPS offering includes the development of infrastructure platforms and hardware and software design solutions in collaboration with customers, managing aspects of the supply chain, manufacturing their products, and providing ITAM/ITAD services. The company’s HPS offering is an engineering-led, IP-based offering that allows it to drive hardware innovation and solutions for its customers and further broaden its value proposition by leveraging its ecosystem partners and broad range of capabilities across the product lifecycle. The company continues to invest in leading-edge product roadmaps and design capabilities aligned with both market standards and emerging technologies in support of its HPS offering. It delivers both partially customized HPS products and complete hardware platform solutions to customers in the storage, servers, and communications markets. These products and solutions are intended to help the company’s customers reach their markets faster and enable their strategies, while reducing total costs, increasing supply chain resilience, and building valuable IP for their product portfolios and/or data centers. Through the company’s collective experience with common technologies across multiple industries and product groups, it provides quality and cost-focused solutions for a wide range of its customers' design needs and strategies.
The company collaborates with some of its core customers' product designers in the early stages of product development, using advanced tools to enable new product ideas to progress from electrical and application-specific integrated circuit design, to simulation, physical layout, and design review, all intended to ensure readiness for manufacturing. The company uses its design expertise to create innovative technologies and hardware product solutions, and leverages key ecosystem partners to drive both innovation and supply chain leverage. The company’s HPS offering encompasses advanced technology infrastructure platforms, and hardware and software design solutions that customers can tailor to their specific applications.
The company’s engineering services team works with its customers throughout the product lifecycle. Its engineering expertise and experience in product and process design, design review, product test solutions, assembly technology, automation, and quality and reliability position it to deliver the services required to address the challenges facing its customers. The company maintains ties with key industry associations and engineering firms to help it stay apprised of advances in technical knowledge.
Prototyping and New Product Introduction
Prototyping is a critical early-stage process in the development of new products. The company’s engineers collaborate with its customers' engineers to provide quick responses in the early stages of the product development lifecycle.
Supply Chain Management and Services
The company uses advanced planning, analytics, enterprise resource planning, and supply chain management systems to optimize materials management from suppliers to its customers' customers.
Through the company’s global supply chain management processes and integrated IT tools, it endeavors to provide its customers with enhanced visibility to balance their global demand and supply requirements, including inventory and order management.
Manufacturing Services
Printed Circuit Board Assembly
Printed circuit board (PCB) assembly includes the attachment of electronic components, such as capacitors, microprocessors, resistors, and memory modules, to PCBs. The company’s global network of engineers helps it to provide its customers with full PCB assembly technology capabilities. These capabilities include design for manufacturing, PCB layout, packaging, assembly (circuit card assembly (CCA)), lead-free soldering, test development, and data analytics for complex flexible and rigid-flex circuits and hybrid PCBs.
Complex Mechanical Assembly
The company provides systems integration and precision machined components to its Capital Equipment customers. Complex mechanical systems integration consists of multiple interconnected subsystems that interact with various materials, such as fluids, solids, particles, and rigid bodies. Such systems are often used in advanced manufacturing applications, such as semiconductor manufacturing, display manufacturing (including LCD, OLED, QLED, and other displays), medical applications using robotics, and other applications where precise standards are required. The company also provides complex mechanical assembly primarily to its aerospace customers, including wire harness assembly, systems integration, sheet metal fabrication, welding, and machining.
Precision Machining
The company utilizes specialized computer-controlled machines to manufacture high-quality components to tight tolerance requirements. Such components are often used in applications similar to those for complex mechanical assembly.
Energy Services
The company provides integrated solutions and services to its renewable energy customers in the areas of power generation, conversion, and monitoring. The company’s energy portfolio includes power inverters, energy storage products, smart meters, and other electronic componentry, and encompasses complete product lifecycle solutions, including design, manufacturing, and reliability services.
Systems Assembly and Testing
The company uses sophisticated technologies in the assembly and testing of its products. It continues to make investments in the development of automated solutions, as well as new assembly and test process techniques intended to enhance product quality, reduce cost, and improve delivery time to customers. The company works independently and also collaborates with customers and suppliers to develop assembly and test technologies. Systems assembly and testing require sophisticated logistics capabilities to rapidly procure components, assemble products, perform complex testing, and distribute products to customers around the world. The company’s full systems assembly services involve combining and testing a wide range of sub-assemblies and components before shipping them to their final destination. Some customers require custom build-to-order system solutions (including data-center rack integration) with very short lead times, and the company is focused on using its advanced supply chain management capabilities to respond to its customers' needs.
Quality and Product Assurance
The company offers comprehensive reliability testing, inspection, and qualification services to support its customers throughout the entire product lifecycle. The company’s quality and product assurance teams conduct rigorous testing to ensure designs meet or exceed required specifications. With expertise in testing to various industry standards, the company collaborates closely with its customers to implement customized test protocols. This proactive approach helps identify certification risks early in the product development process, ultimately reducing costs and accelerating time to market.
Failure Analysis and After-Market Services
The company’s extensive failure analysis capabilities concentrate on identifying the root cause of product failures and determining corrective actions. Products are subjected to various environmental extremes, including temperature, humidity, vibration, voltage, and contamination. Field conditions are simulated in failure analysis laboratories that employ electron microscopes, spectrometers, and other advanced equipment. The company’s engineers work proactively in partnership with suppliers and customers in an effort to discover product failures before products are shipped, and to develop and implement solutions if required.
The company also seeks to provide value to its customers through its after-market services offerings, which include repair, fulfillment, reverse logistics, ITAM/ITAD, reclamation, and returns processing and prevention. The company’s fulfillment offering includes the design and management of integrated supply chain and materials management for light manufacturing and final assembly and reclamation. The company’s reverse logistics offering includes the design and management of transportation networks, warehousing, and distribution of products, asset recovery services, and transportation and supply chain event monitoring. The company’s ITAM/ITAD offering is a single source solution to dispose of IT assets with optimal sustainability, including hardware buyback, remarketing/resale, data erasure and destruction, parts harvesting, redeployment, and donations. The company’s returns processing and prevention offering provides its customers with product screening and testing and product design and process analysis. The company’s reclamation offering includes product disassembly, reassembly, and re-use, as well as certified scrap disposition processing. The company offers these services individually or integrated through a 'Control Tower' model, which coordinates its people, systems, and processes with those of its customers to improve service levels by providing an increased level of visibility and analytics throughout the entire after-market value chain.
Product Licensing
With respect to the company’s partners that are seeking to rationalize their product lines, licensing to it provides them with an alternative to sale or discontinuation. Celestica manages the entire business process for the licensed product or product line, including order acceptance, customer service, engineering, supply chain, obsolescence management, manufacturing, logistics, service parts offering, and after-market services. This allows the company’s partners to continue to serve their customers while maintaining ownership of their IP, and to redeploy their resources for other uses.
Marketing and Customer Experience
The company structures its business development teams by end market, with a focus on offering market insight and expertise, and complete manufacturing, HPS (in the case of the company’s CCS segment), and supply chain solutions to its customers. The company has customer-focused teams, each headed by a group general manager who oversees the global relationship with its key customers. These teams work with its subject matter experts to meet the requirements of each customer's product or supply chain. The company’s global network consists of such customer-focused teams, as well as operational and project managers, supply chain management teams, and senior executives.
The company provides comprehensive support before, during, and after the delivery of its products and services. It seeks to deepen and grow its customer relationships by providing consistent, high-quality implementation and customer support services, which drives customer retention and additional opportunities within its existing customer base.
Customer Concentration and Relationship Management
The company targets industry-leading customers in each of its segments. Its current CCS segment customers include Amazon Fulfillment Services, Inc., Ciena Corporation, Dell Technologies, Google Inc., Hewlett-Packard Enterprise, IBM Corporation, Juniper Networks, Inc., and Meta Platforms, Inc. The company’s current ATS segment customers include Applied Materials, Inc., LAM Research, and Honeywell Inc. The company is focused on strengthening its relationships with strategic customers through the delivery of new and expanding end-to-end solutions.
Competition
The company’s competitors include Benchmark Electronics, Inc., Flex Ltd., Hon Hai Precision Industry Co., Ltd., Jabil Inc., Plexus Corp., and Sanmina Corporation, as well as smaller EMS companies that often have a regional, product, service, or industry-specific focus, and ODMs (including Quanta Computer Inc., Wiwynn Corporation, and Accton Technology Corp.) that provide internally designed products and manufacturing services.
History
Celestica Inc. was founded in 1994. The company was incorporated in 1994.
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