GT Advanced Technologies (NASDAQOTH:GTATQ) announced financial results in what is another in a string of transitional quarters for the company, as possible Apple-related revenue remains on the horizon. Corning (NYSE:GLW), GT's chief competitor, recently announced its sixth-consecutive quarter of earnings growth, as its Gorilla Glass maintains the lead for now. GT's sapphire glass may be the wave of the future, but can its promise maintain GT's stock price today?

Revenue of $22.5 million was down $35 million from the $57.8 million in the year-ago quarter. These numbers look ugly, but it's important to remember that the company is transitioning from being a provider of polysilicon manufacturing equipment to building the market for sapphire furnaces and products. The loss per share of $0.22 was in line with expectations.

Not just sapphire
The company booked $29 million of equipment orders during the quarter, which included $15 million in photovoltaics and $14 million in sapphire. Even though investors are focused almost entirely on the sapphire business, the opportunities in solar continue to support the business.

Light sapphire revs
Sapphire revenue was only $5.6 million in the quarter, which is down substantially from the $15.4 million in the prior year and $18.8 million in the December quarter. This may be a sore point with investors but can be explained by the increased focus on the Apple relationship.

Profits not likely in 2014
GT is likely to be posting losses for some time, since the sapphire business has a negative gross margin, let alone operating margin. But the stock price has been more influenced by the market opportunity than the profits generated from the business. The cash burn in the sapphire business is supported by stable margins in the polysilicon and photovoltaic business, which continue to be in line with historical levels.

Third check received
The biggest issue for the company is the status of the deal with Apple. While the company has been tight lipped about it, it did say that it received the third of the four prepayments that it is expecting. The payment was received after the quarter closed, however, so its effect wasn't visible in the financials.

G

Proton Induced Exfoliation

Sapphire fracking is part of the secret sauce
While it is possible for other vendors to produce sapphire, GT has developed a technology that creates thin laminates from larger wafers, dramatically reducing the cost for the customer. GT found a way to inject hydrogen gas into a thick wafer. After the gas penetrates the surface, the entire wafer -- including the gas -- is heated. The gas expands, slicing off a uniformly thin layer that can be laminated onto another substance. This provides the scratch-resistance benefits of sapphire in a cost-effective manner. This process is called proton-induced exfoliation, which is a mouthful, but you can think of it like sapphire fracking. The process is similar.

Promise vs. results
Corning is the vendor likely to be displaced as sapphire gains acceptance, but the stock is up 17% year to date, and it has held its ground since reporting earnings in April. In the future, it's possible that sapphire glass will eat into Corning's $2.4 billion in core sales, but today the company is holding firm.

Profits vs. opportunity
GT's geeky chic technology has earned it quite a bit of attention, but until we have confirmation that sapphire will be used in the iPhone 6, the stock seems to be at risk. Even though the share price has pulled back $4 from its high of $19.44, the stock could have further to go if investors begin to focus on profits instead of opportunity.

David Eller has no position in any stocks mentioned. The Motley Fool recommends Corning. The Motley Fool owns shares of Corning. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.