Most artificial intelligence (AI) development happens inside enormous, centralized data centers, which house thousands of specialized chips called graphics processing units (GPUs). Nvidia and Advanced Micro Devices are two of the world's top suppliers of GPUs, but Broadcom is also in the mix with customizable chips it calls AI accelerators.
But AI infrastructure is made up of more than chips alone. Corning (GLW 0.53%) has become a top supplier of fiber-optic cables, which transmit data at a much faster rate than copper cables. Speed is everything in the AI race, so data center operators are buying Corning's fiber hand over fist right now. That's driving a surge in the company's revenue.
Corning's stock price has rocketed higher by 170% over the last 12 months. It's crushing Nvidia, AMD, and Broadcom, which are up 61%, 94%, and 84% respectively over the same period. Here's why further gains might be ahead.
Image source: Getty Images.
AI data center operators are moving to fiber
Nvidia's flagship Blackwell GPUs are often configured using the company's NV-Link racks. Each rack typically includes 72 GPUs, along with 36 central processors (CPUs) and several networking components. Each rack is connected using two miles of copper cable, but data center operators are quickly transitioning to fiber, which is a huge opportunity for Corning.
Fiber is proven to transmit information at faster speeds, and over much longer distances, than copper, with minimal data loss. Many AI developers pay for cloud computing capacity by the minute, so faster processing speeds can result in substantial cost savings over time.
Plus, while 72-GPU data center racks are the standard right now, every rack will eventually house hundreds of GPUs in the future, so the efficient transmission of data will become an even greater priority. That's why Facebook parent company Meta Platforms just secured its future supply of fiber. It signed a deal with Corning in January to purchase a whopping $6 billion worth of cables over the next few years.
But this is only the beginning. Corning CEO Wendell Weeks predicts that the size of the market for data center optical fiber could triple in size over the long term, thanks to demand from AI developers.
Corning's AI-related revenue is soaring
Corning produced $16.4 billion in core revenue during 2025, which was a 13% increase from the previous year. Its optical communications business contributed $6.2 billion in revenue, and grew at a much faster pace of 35%.
The enterprise segment of the optical communications business, specifically, delivered $3 billion in revenue, which was up by a whopping 61%. The amount of revenue attributable to hyperscaler customers more than doubled, which truly highlights how much demand there is for data center optical fiber right now.
That demand grants Corning a significant amount of pricing power, which resulted in a record $1 billion profit for its optical communications business alone during 2025, up 71% from the prior year. This contributed to core (adjusted) earnings of $2.52 per share for the company overall.
Corning stock isn't cheap, but it might be a buy
Based on Corning's core 2025 earnings, its stock is trading at a price-to-earnings (P/E) ratio of 48.9, which is a hefty premium to the 31.8 P/E ratio of the Nasdaq-100 index. In other words, the stock looks quite expensive compared to a basket of other high-quality tech powerhouses.
NYSE: GLW
Key Data Points
Corning is also more expensive than Nvidia, which is trading at a P/E ratio of 37.3 as I write this. However, Corning trades much closer to the P/E ratios of AMD and Broadcom, which currently stand at 46.1 and 45.5, respectively.
While it's reasonable to argue that Corning stock is fully valued right now, there might still be some upside on the table for investors who are willing to hold on to it for the next couple of years. Wall Street's consensus estimates (provided by Yahoo! Finance) suggest that the company's earnings will grow to $3.11 per share in 2026, and then to $3.87 per share in 2027, placing its stock at forward P/E ratios of 39.6 and 31.8, respectively.
Plus, Weeks says that Corning is in the process of finalizing several other agreements of similar size and scope to its recent Meta deal, so analysts might have to raise their earnings forecasts when more information becomes available. In other words, Corning stock might actually be cheaper right now than it appears at face value.
