(Reuters) – Specialty glass maker Corning forecast current-quarter profit largely below Wall Street estimates on Tuesday, blaming a slowdown in demand for its clean-air technologies, even as it saw robust sales for its optical fiber products.
Shares slipped more than 8% in early trading as the report failed to rally investors, who were betting on the growing adoption of generative artificial intelligence technologies to drive the company’s profits higher.
Corning’s optical communications segment, its largest unit, has benefited from higher demand for fiber optic cables driven by improved spending from wireless carriers as well as companies building AI operations that require high-capacity optic cables.
The business saw a 4% increase in sales in the quarter ended June 30.
It was not enough to offset a 6% slump in sales at its Environmental Technologies unit, which makes filter products for emissions control in automobiles, due to slowing demand for heavy-duty Class 8 trucks amid a freight slowdown in North America.
The segment’s net income fell 9% to $97 million.
Known for the Gorilla Glass used in smartphones made by companies including Apple and Samsung, Corning projected core earnings between 50 cents and 54 cents for the third quarter, the midpoint of which is below analysts’ average estimate of 54 cents, according to LSEG data.
New York-based Corning forecast core sales of about $3.7 billion, a touch below analysts’ estimate of $3.75 billion.
The company reported core sales of $3.60 billion in the second quarter, edging past market expectations of $3.55 billion. Its adjusted per-share profit of 47 cents topped estimates by 1 cent.
(Reporting by Deborah Sophia in Bengaluru)
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