Can Corning's Fiber Optics Focus Strategy Drive Long-Term Growth?

Corning Incorporated GLW is increasingly focusing on the fiber optic solutions business to cater to the huge demand pool and generate a steady revenue stream. Multiple factors are likely to drive the company’s fiber-optic solutions business over the next several years, primarily the increasing use of mobile devices that require efficient data transfer and networking systems. Supporting this trend is the proliferation of clouds, which is resulting in increased storage and even computing on a virtual plane. 

Since both consumers and enterprises are using networks more extensively, and the data generated is increasingly being used to train AI models, there is tremendous demand for quality networking. Additionally, data consumption patterns are changing, with a growing propensity to consume video content, creating the need for faster data transfer. Since optical networks are more efficient and most existing networks are copper-based, the demand for optical solutions is strong. 

Corning offers several products focused on the data center, with a portfolio consisting of optical fiber, hardware, cables and connectors, enabling it to create optical solutions to meet evolving customer needs. This augurs well for its long-term growth. In addition, broadband and 5G create near-term momentum. The increasing adoption of innovative optical connectivity products for generative AI applications is expected to be a key growth driver in the Optical Communication segment.

Some Other Tech Firms Focusing on Fiber Optics

CommScope Holding Company, Inc. COMM has a significant presence in the fiber optics market with multi-fiber connectivity and cable solutions for use in telecommunications, cable television, residential broadband networks, data centers and business enterprises. The company’s SYSTIMAX 2.0 portfolio includes FiberREACH, which delivers fiber connectivity and power to edge devices, and CableGuide 360, which simplifies fiber and copper cable management in dense enterprise networks. Its Propel XFrame product is a high-density floor-mounted fiber frame that helps modern data centers efficiently manage scalable duplex and MPO fiber connections.

Amphenol Corporation APH offers high-speed fiber optic interconnect solutions for diverse businesses. Its optical components are a strategic fit to Fiber-to-the-Home (FTTH) networks, signal splitting, routing and fiber management and outside plant optical systems. These products support high-speed broadband deployment at residential and enterprise scales. Amphenol’s fiber-optic cable assemblies that combine fiber cables with connectors are ideal for telecommunication networks, high-speed data transport and industrial and harsh environments. These assemblies are critical for link integrity, low signal loss and long-distance optical communication.

GLW’s Price Performance, Valuation and Estimates

Corning shares have gained 87% over the past year compared with the industry’s growth of 110.4%.

Going by the price/earnings ratio, the company's shares currently trade at 29.42 forward earnings, lower than 34.55 for the industry. 

Earnings estimates for 2025 have increased 0.8% to $2.52 per share over the past 60 days, while the same for 2026 have moved up 1% to $3.02.

Corning currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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