Corning is the display screen company that is very well known for their Gorilla Glass. It has been synonymous with smartphones and tablets and used for higher durability and resistance to the rigors of daily use. Corning has overestimated the market and is seeing a lack of demand for their technology.
According to the Wall Street Journal “Gorilla Glass has faced headwinds, with sales falling 17% last year as Corning worked through an inventory overhang after a bad bet on touch-screen laptops. ”
Overall, Corning reported a profit of $169 million, down from $638 million a year earlier. The worldwide tablet grew 11.0% year over year in the second quarter of 2014 with shipments reaching 49.3 million units according to preliminary data from the International Data Corporation . Apple is currently one of Corning’s largest customers and they have reported shipping 13.3 million iPads during the third fiscal quarter of 2014, compared to 14.6 million in the year-ago quarter.
When it comes down to public perception, Corning is basically known for their Gorilla Glass. What most people don’t know, is that this represents only 11% of their entire revenue stream and the majority from LCD televisions. That business jumped 62% year over year, while revenue from other specialty materials was merely flat.
There has been lots of buzz in the industry about Apple’s move into developing sapphire glass in conjunction with GT Advanced Technologies last November. Speculation is running rampant that their future devices will employ this ultra lightweight and scratch resistant technology into future products. Many experts cite shortages of the new material and that current plants cannot accommodate the demand of a massive launch. Apple alone plans for 80 million iPhone 6 models this year.
Corning will be a safe bet for the tablet industry for another few years. The market is maturing and less people are buying new devices or upgrading. We have seen similar trends plague the e-reader industry in recent years.