Corning Inc. (NYSE:GLW), a key supplier of glass used in Apple Inc.'s iPhone and Apple Watch, shares are sinking on Tuesday. The company reported first-quarter results and issued second-quarter sales guidance below estimates.

Earnings Snapshot

The Corning, N.Y.-based company posted adjusted earnings of 70 cents per share, beating analyst estimates of 69 cents.

Core sales rose 18% year over year (Y/Y) to $4.35 billion, exceeding the $4.26 billion consensus.

On a GAAP basis, Corning reported $4.14 billion in revenue (+20% Y/Y) in the quarter.

Core EPS grew 30% Y/Y, while core operating margin expanded 220 basis points Y/Y to 20.2%.

Operating cash flow was $362 million, and adjusted free cash flow stood at $188 million in the quarter.

Segments Performance

Optical Communications revenue rose 36% Y/Y to $1.85 billion, while Glass Innovations sales rose 1% Y/Y to $1.42 billion.

Automotive sales declined 1% Y/Y to $437 million, and Life Sciences and Emerging Growth Businesses segment sales remained flat Y/Y at $272 million.

Meanwhile, Solar segment sales escalated 80% Y/Y to $370 million in the quarter.

Outlook

For the second quarter, Corning expects core sales to grow about 14% Y/Y to $4.600 billion, versus the estimate of $4.631 billion. Also, it expects and adjusted EPS of 73 to 77 cents, ahead of the 75-cent consensus.

The quarterly outlook accounts for a prolonged maintenance shutdown at Corning's solar wafer facility. This includes shifting to a permanent power system and upgrading production equipment to enhance future output. It is expected to increase expenses by around $30 million in the quarter compared to the first quarter.

CEO Wendell P. Weeks added, “Based on strong demand for our innovations, we plan to upgrade and extend our Springboard plan through 2030 at our May 6 investor event. We will introduce our new Photonics Market-Access Platform and explain the underlying technical and demand trends driving our Gen AI product development.”

Corning, Meta Begin Facility Construction

This month, Corning and Meta Platforms (NASDAQ:META) have begun construction on an expanded optical cable manufacturing facility in Hickory, North Carolina.

The deal, announced recently on March 31, is to support the growing demand for AI data center infrastructure.

The project is part of a multiyear agreement worth up to $6 billion, under which Corning will supply advanced optical fiber and connectivity solutions, with Meta as the anchor customer.

The expansion is expected to strengthen the U.S. supply chain for AI infrastructure and could increase Corning's North Carolina workforce by 15% to 20%, reinforcing the state's role as a key manufacturing hub.

GLW Price Action: Corning shares were down 8.80% at $153.22 at the time of publication on Tuesday, according to Benzinga Pro data.

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