Table of Contents

Market Context
What Happened
Why It Matters
Sector Breakdown
Risks to Watch
What to Watch Next
Final Outlook

Market Context

Canadian growth and technology stocks delivered one of their strongest sessions of the summer Monday, led by a dramatic surge in Shopify tied to renewed analyst confidence in the company’s resilience against AI-driven disruption, alongside a standout earnings report from Celestica that landed right on schedule after the closing bell.

What Happened

Shopify surged 11.64% Monday to close at $179.14, the best-performing stock on the TSX Composite that day, after RBC published commentary noting the company’s software shows “great defensibility” against AI-driven disruption, a concern that has weighed on software valuations broadly in recent weeks. Constellation Software also rallied strongly, gaining 6.4% the same session. Celestica reported second-quarter 2026 results after Monday’s close, posting revenue of $4.70 billion, up 62% from $2.89 billion in the same period last year, alongside GAAP earnings per share of $3.17, up from $1.82, and adjusted earnings per share of $2.54, up from $1.39. GAAP operating margin improved to 9.8% from 9.4%, while adjusted operating margin rose to 8.2% from 7.4%. The stock had already gained 4.5% during Monday’s regular session ahead of the release, with management scheduled to host a conference call this morning to discuss the results in detail.

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Why It Matters

Shopify’s surge represents a meaningful shift in how analysts are framing AI’s impact on software companies. Rather than treating AI as a uniform disruptive threat to enterprise and commerce software broadly, RBC’s specific commentary on Shopify’s defensibility suggests a more nuanced view is emerging, one that could support renewed investor confidence in select software names that had faced pressure from broader AI competitive concerns.

Celestica’s results confirm that AI infrastructure demand remains a powerful growth driver for the company’s data centre and hardware business. A 62% year-over-year revenue increase, alongside meaningfully improved margins, suggests the AI-driven re-rating the stock has undergone in recent months continues to be supported by genuine operational execution rather than sentiment alone.

Sector Breakdown

Within e-commerce and commerce technology, Shopify’s dramatic single-day gain reflects both the RBC commentary and broader relief across technology stocks following the weekend’s easing of oil-driven inflation concerns. Within enterprise software, Constellation Software’s strong advance suggests some of the same renewed confidence extended beyond Shopify specifically, benefiting the acquisition-focused software conglomerate broadly. Within AI-linked hardware manufacturing, Celestica’s results reinforce the company’s position as one of the clearest Canadian beneficiaries of continued global AI infrastructure spending, with both revenue growth and margin expansion supporting the stock’s premium valuation.

Risks to Watch

For Shopify, the scale of Monday’s single-day gain means the stock now carries an even steeper valuation heading into its own upcoming earnings, raising the stakes for that report to confirm the growth trajectory analysts are now pricing in. For Celestica, continued reliance on a small number of large hyperscaler customers for its data centre business remains a structural risk, even as Monday’s results demonstrate strong current execution. Broader technology sector sentiment remains sensitive to shifts in the underlying ceasefire situation, given how directly Monday’s rally was tied to falling bond yields following the weekend’s oil price decline.

What to Watch Next

Investors should watch Celestica’s earnings conference call this morning closely for management commentary on forward guidance and continued AI infrastructure demand trends. Shopify’s next earnings report will be an important test of whether the company can deliver results that justify Monday’s dramatic re-rating. Continued developments in the U.S.-Iran ceasefire situation will remain relevant for broader technology sector sentiment, given how closely Monday’s rally tracked the easing of oil-driven market pressure.

Final Outlook

Monday’s session delivered genuinely strong news for Canadian growth and technology investors, with Shopify’s AI defensibility re-rating and Celestica’s solid earnings beat both reinforcing distinct, positive narratives within the sector. Investors should watch today’s Celestica earnings call and Shopify’s continued momentum closely, given how much both stocks have moved in a short period.

Verdict: Watchlist candidates, not a broad buy signal, given how much both names have already re-rated following Monday’s news.