TLDR
- Corning beat Q1 estimates with adjusted EPS of $0.70 and core sales of $4.35B, up 18% year-over-year
- Q2 revenue guidance of $4.6B came in below Wall Street’s $4.63B–$4.65B expectation
- Optical communications sales surged 36% to $1.85B, beating estimates of $1.7B
- Corning signed two new hyperscaler deals similar in size to its $6B Meta agreement
- Consumer electronics weakness continues to drag, with glass innovations segment up just 1%
Corning beat first-quarter earnings and revenue estimates, but a soft second-quarter sales outlook sent the stock tumbling more than 10% in premarket trading on Tuesday.
The company posted adjusted earnings of 70 cents per share, just above the 69-cent analyst estimate. Core sales came in at $4.35 billion, up 18% from a year ago and ahead of the $4.26 billion Wall Street was expecting.
That should have been a good morning. It wasn’t.
Corning guided for Q2 core sales of around $4.6 billion. Analysts had penciled in $4.63 billion to $4.65 billion. That gap — not huge in dollar terms — was enough to spook investors who had pushed the stock up 92% this year heading into Tuesday’s print.
Optical Division Powers Ahead
The optical communications segment continued to be the engine of Corning’s growth. Net sales in that division hit $1.85 billion in Q1, a 36% jump from the same period last year and well above estimates of $1.7 billion.
Corning also announced it has finalized two new long-term agreements with hyperscalers, described as “similar in size” to the $6 billion Meta deal it announced in January. The company did not name the customers.
The fiber and cabling business has become Corning’s largest segment and a direct beneficiary of data center buildout tied to AI infrastructure.
Consumer Electronics Still a Drag
While the data center business booms, Corning’s consumer-facing operations are still struggling. The glass innovations segment, which covers display and specialty materials, grew just 1% in Q1 to $1.42 billion.
Slower smartphone replacement cycles and cautious consumer spending have weighed on demand for Corning’s specialty glass. The company is a key supplier to Apple, and softer global smartphone volumes have pressured that side of the business.
The weakness in consumer electronics is offsetting some of the strength coming from optical communications.
Tuesday’s selloff also had a broader market backdrop working against it. Tech stocks were under pressure after the Wall Street Journal reported that OpenAI missed its own revenue and growth targets — not a great day to be an AI-adjacent name.
Other optical networking stocks fell alongside Corning. Ciena dropped 4.8%, Coherent fell 5.6%, and Lumentum was also down 5.6% in premarket trading.
Corning stock was up 92% for the year as of Monday’s close.
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