Corning (NYSE:GLW) reported second-quarter 2026 results that exceeded its guidance, led by continued growth in Optical Communications and demand for products supporting generative AI data centers. The company also reiterated its long-term Springboard growth plan, which calls for an annualized sales run rate of $20 billion by the end of 2026, $30 billion by the end of 2028 and $40 billion by the end of 2030.
On a core, non-GAAP basis, second-quarter sales rose 17% year over year to $4.74 billion, while earnings per share increased 30% to $0.78. Gross margin expanded 120 basis points to 39.6%, operating margin increased 190 basis points to 20.9%, and return on invested capital rose 180 basis points to 14.9%. The company generated $1.42 billion in free cash flow.
Optical Communications Drives Results
Optical Communications remained the company’s largest growth driver. Segment sales increased 32% from a year earlier to $2.07 billion, while net income climbed 77% to $438 million. The segment posted record profitability, with net profit after tax equal to 21% of sales.
Enterprise sales rose 65% year over year, supported by demand for Corning’s generative AI-related connectivity products. Sales related to AI data centers nearly doubled during the quarter, according to Chief Financial Officer Ed Schlesinger. Carrier sales increased 1% year over year in the quarter, though Weeks said first-half carrier revenue was up about 17% from the first half of 2025, reflecting customer project timing.
Management said it expects longer-term carrier sales to grow at a mid-single-digit rate, driven by fiber-to-the-home deployment and data-center interconnect demand. Weeks also said long-term customer agreements are expected to become the “lion’s share” of the company’s optical business, as major capacity expansions are supported by agreements intended to share investment risks and returns with customers.
Corning recently announced major customer arrangements with Meta, NVIDIA and Amazon. The agreements cover optical fiber, cable and connectivity solutions for AI and data-center infrastructure. Weeks said the company continues to see demand exceeding its ability to produce more of its most innovative, high-density optical products.
AI Network Architecture Creates Additional Opportunity
Weeks outlined several factors that Corning believes could increase optical content per graphics processing unit in AI data centers. These include larger AI clusters requiring an additional optical network layer, bandwidth growth and the eventual adoption of optical connections in “scale-up” networks, which currently use copper.
Corning estimates that optical content per GPU in its enterprise business could increase by 1.3 times to 1.5 times by 2028. Its internal planning assumption treats the impact of bandwidth changes on fiber count per GPU as neutral, while potential scale-up adoption represents a larger and less predictable opportunity.
The company is also building a new photonics market-access platform focused on passive optical components inside equipment, including applications associated with co-packaged optics and near-package optics. Corning expects the photonics platform to represent a $10 billion revenue opportunity by 2030, although management stressed that the timing and degree of optical scale-up adoption remain uncertain.
During the question-and-answer session, Weeks said Corning had not provided a specific photonics revenue outlook for next year. He said the company’s longer-term plan incorporates different possible timing and content scenarios for optical scale-up adoption.
Other Businesses and Solar Outlook
In Glass Innovations, sales were $1.46 billion, up 1% from a year earlier, while net income increased 9% to $354 million. Higher display glass sales supported the segment. Corning expects memory prices to reduce handheld-market unit volumes by a mid-teens percentage for the full year, but said Gorilla Glass should outperform the broader market due to premium-device demand and higher content per device, including glass ceramics and foldable-display products.
Automotive segment sales rose 2% to $471 million, and net income increased 4% to $82 million. Corning said its automotive sales outperformed the global vehicle market, which declined 2%, due to increased content per vehicle. Diesel sales rose 3% year over year and 13% sequentially, supported by improving North American Class 8 orders.
Solar sales surged 90% year over year to $438 million, though the segment recorded a $7 million net loss. The company incurred an additional $30 million of expense compared with the first quarter as its solar wafer facility underwent an extended maintenance shutdown, including a transition to a permanent power system and equipment repairs and upgrades.
Schlesinger said customer demand remains strong and that solar sales and profitability should improve beginning in the third quarter. Corning remains on track to build the solar business into a $3 billion revenue stream with profitability above the corporate average, he said.
Third-Quarter Guidance and Financial Plan
For the third quarter, Corning forecast sales of $4.9 billion to $5 billion, representing approximately 16% year-over-year growth. Core EPS is expected to be $0.85 to $0.89, up approximately 28% from a year earlier. Schlesinger said the guidance was not intended to indicate a deceleration in growth, and enterprise optical demand is expected to remain a significant contributor.
The company expects to invest about $2 billion in capital expenditures during 2026, with investment increasing in the third and fourth quarters to support Optical Communications growth. Corning also expects to generate significantly more free cash flow year over year despite those investments.
Corning’s risk-adjusted, high-confidence plan calls for annualized sales of $27 billion by the end of 2028 and $35 billion by the end of 2030. Management expects operating margin to remain at or above 20%, return on invested capital to improve into the high teens through the planning cycle, and free cash flow to grow as customer agreements help support expansion investments.
About Corning (NYSE:GLW)
Corning Incorporated is a global manufacturer specializing in specialty glass, ceramics and related materials and technologies. Headquartered in Corning, New York, the company supplies engineered materials and components used across multiple industries, including consumer electronics, telecommunications, automotive emissions control, pharmaceutical and life sciences, and industrial and scientific applications. Corning emphasizes materials science and precision manufacturing to develop durable, high-performance glass and ceramic products.
Key product lines include specialty display glass used by television and mobile-device manufacturers, cover glass marketed under well-known trade names for smartphones and tablets, and optical fiber and cable and related hardware for telecommunications networks.
