Corning (GLW -0.40%) stock has been a disappointment at times over the past decade, but the company just delivered a blowout earnings report, featuring strong growth in areas like fiber optics and glass vials for vaccines. In this episode of "Beat and Raise," recorded on Jan. 28, Fool contributors John Bromels and Brian Withers discuss Corning's recent quarter and what to expect from the company going forward.

Brian Withers: Can you tell us how Corning's quarter went?

John Bromels: Corning absolutely knocked it out of the park this quarter. Being a glass company, I really hope that when they knocked it out of the park, it did [laughs] not go through the neighbor's window. But let me show you this. Just the first thing you're going to see.

Withers: You highlighted with some explanation points.

Bromels: Right. They knocked it out of the park. Boy, are you going to see how the market reacted. Look at that jump. [laughs] That is just the last two days since they reported earnings, got an immediate bump in their share price. Then the next day, Goldman Sachs analysts said, "We are changing our outlook on this." It went up some more, which is good because Corning has been one of those stocks. I'll show you the little inset. The purple line is Corning's share price. I did this without total returns for a reason, although they do pay a dividend. The orange line is the S&P. I always have felt like Corning is one of those stocks that they got no respect from the market and you can see it's been up, it's been down, it's tracked the S&P. But if you look right there at the end of the line, there's the S&P going almost straight down and there's Corning going almost straight up to roughly, this is the last 10-year performance, roughly equal the S&P's performance again, that is without total returns.

Withers: They're like Kansas City Chiefs [laughs] when we're seeing it with the last 13 seconds.

Bromels: Oh, man, or the Cincinnati Bengals, for that matter. Yes. There's been a lot of that this year, but goodness, what did I do? There we go. Let's take a look at the results of the quarter. Revenue, $3.67 billion, right up at the top end of their guidance of 3.7 billion and 10 percent up, year over year. We'll call that a beat because it beat analysts projections. Q4 core EPS, 54 cents, again, almost at the top of their guidance, which was for, I think 52 to 55 cents, also beat projections, up 4 percent.

For the full-year 2021, $14.1 billion in revenue, so up 25 percent now, of course, coming off of a fairly easy comp year of 2020. But estimating another big jump in revenue in FY 2022 to $15 billion. They are calling, basically reiterating the same guidance they had this quarter for next quarter, $3.5 billion to $3.7 billion. Estimating a slight drop in EPS, that's more seasonal than anything, 48 to 53 cents a share. This was very impressive guidance that they offered for the full year that they were going to see almost a billion dollars more in revenue. That is what has everybody really excited.

Highlights from the quarter. Things are actually starting to all go right for Corning. For years they weren't going so well because their display technologies segment, which is essentially screens mostly for televisions, because they are the largest screens and so require the most glass, pricing was not so great in display technologies, but it has strengthened and it remains strong. That was one reason they did well this quarter. Optical sciences, which is basically fiber optic cable essentially, it's some other things, too. But primarily it's fiber optic cable, which is made up glass fibers. Really benefiting from build-outs in broadband, build-outs in 5G, build-outs in that telecommunications infrastructure. They are seeing a benefit from that. Life sciences also benefiting because their life sciences segment makes glass vaccine vials, and those have also been in demand worldwide around the winter October through December quarter.

Basically all of their areas doing really well except for one. That pops us down into the concerns for the quarter. Of course, that's automotive. They do a lot of automotive work, not just auto glass, but also coatings for the cars and various components within the cars. Here's the thing. They ran into freight problems. They ran into material shortages, they ran into logistics concerns, they ran into lower auto sales, and they ran into chip shortages, which caused lower auto sales. All of this combined really hurt the gross margins for the company. Gross margin of 36.5 percent down 180 basis points sequentially. That was probably the big topic in the earnings call.

CEO Wendell Weeks, really focusing on the gross margin, saying that these gross margins are not acceptable. They really need to do better. However, he thinks that they are about to turn the corner because the reason gross margins have been suffering is in part because of all these increased costs they're seeing in terms of freight, in terms of materials cost, in terms of logistics cost. He believes that they have been able to now adjust enough of their long-term contracts to account for the higher materials costs, basically passing them on, passing those higher costs onto the manufacturers of the cars, TVs, whatever it is. They think they've been able to do that. He says that he thinks that Q1 is going to be the low point in terms of gross margin. But after that, starting in Q2, we should see it going up, up, up, and that is part of the reason why he and his management team are projecting such a strong performance for fiscal year '22. That is the story.

Withers: That's really cool to see Corning knock one out of the park after getting no respect. I was looking at their infographic for the full year, and I didn't realize how big of a business their optical communications was. For the full year, optical communications sales grew 22 percent to 4.3 billion. Making teeny little glass tubes where data can go over is a highly profitable business.

Bromels: Yeah, it's really interesting because if you don't know the company, you probably heard of Corning from CorningWare, your grandma had, like, a casserole dish. But they've sold that, that business has gone. It is sold a long time ago. The things that they are doing now -- they're not all super high-tech applications -- but a lot of high-tech applications. Devices, your phone screen, TV screen, cars and related automotive technology, and fiber optics. It's really one of these industrial companies that has strayed far enough into tech that it is almost a quasi industrial tech company.