A screen displays the logo for Corning Inc. at the New York Stock Exchange (NYSE) in New York, U.S., November 18, 2019. REUTERS/Brendan McDermid/File Photo Acquire Licensing Rights
Oct 24 (Reuters) – Corning (GLW.N) forecast fourth-quarter core sales below market expectations on Tuesday, as the specialty glass maker grapples with slowing demand for its optical fibre cables from the telecom sector.
Shares of Corning, whose Gorilla Glass is used by the likes of Samsung (005930.KS) and Apple (AAPL.O), fell nearly 4% before the bell.
The company expects core sales of about $3.25 billion in the three months through December, compared with analysts’ estimate of $3.56 billion, according to LSEG data.
In the third quarter, its core sales fell by about 6% to $3.46 billion, missing estimates of $3.50 billion.
The optical communications unit, one of Corning’s main revenue generators, saw its net sales decline by more than 30%.
“Our markets continue to reflect demand below trend lines,” CEO Wendell Weeks said.
But revenue from the specialty materials business, which includes the widely used Gorilla Glass, rose about 8% thanks to the launch of Apple’s new iPhone 15 lineup.
Data from Counterpoint Research shows that the global smartphone market shrunk by 8% to its lowest third-quarter level in a decade, showing only a marginal improvement from the prior quarter.
The company forecast fourth-quarter core earnings of between 37 cents and 42 cents per share, below estimates of 50 cents per share.
It posted quarterly adjusted profit of 45 cents per share, missing analysts’ estimate of 47 cents per share.
Corning has aggressively cut costs and hiked prices by about 20% over the past quarters to cope with bleak demand and tough economic conditions. Its core gross margin improved by 90 basis points year-on-year to 37% in the third quarter.
Reporting by Arsheeya Bajwa in Bengaluru; editing by Milla Nissi
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