Key takeaways
- Meta will pay Corning up to $6B by 2030 for fiber-optic cable to fuel its AI data center expansion.
- In an interview at Corning’s Hickory, North Carolina, factory, CEO Wendell Weeks told CNBC that next year, the hyperscalers will be our biggest customers.
- Onyx’s stock has risen by more than 75% over the past year, driven by increased fiber demand from customers such as Meta, NVIDIA, OpenAI, Google, AWS, and Microsoft.
To support its fast expansion in artificial intelligence, Meta is building massive data centers and has turned to a historic glass manufacturer for key components.
Neta will pay Corning up to $6B through 2030 for fiber optic cable to power its AI-focused data centers. This major agreement was revealed by Corning CEO Wendell Weeks.
Corning’s stock rose 16% on the news. It’s the best day in over 20 years.
Corning is expanding its facility to meet increasing demand from Meta and other major clients, aiming to operate the world’s largest fiber optic cable plant.
Almost every call I receive from customers is about how we can supply them with a longer supply. Looking ahead, I believe hyperscalers will become our biggest customers next year.
Corning shares have increased by more than 75% over the past year, driven by growth in its optical communications segment. The company is among several providers experiencing unprecedented demand as data centers are upgraded for AI applications.
Meta’s AI strategy has raised questions with investors. The company’s stock underperformed in 2025 and posted its largest three-year decline after announcing significant AI investments without a clear monetization plan. In November, Meta committed to spending $600 billion in the US by 2028 on data centers and related infrastructure, including its partnership with Corning.
Neta plans to build 30 data centers, 26 of which will be located in the United States.
We want a domestic supply chain to support this, said Joel Kaplan, Meta’s chief global affairs officer.
Responding to concerns about China leading in AI, Kaplan said, “If we don’t make the right policy choices and investments, that’s a real risk.”
Meta is building two of its largest data centers:
- The Prometheus site in New Albany, Ohio
- The Hyperion site in Richland Parish, Louisiana
Both will use Corning fiber optic cable.
Having experienced a prior tech bubble, the current market skepticism about whether recent investments will yield sustainable businesses, with AI companies announcing over $1 trillion in compute deals for 2025, has some experts now predicting another bubble may be developing.
Building on this recognition, Corning recalls its considerable success during the dot-com boom when demand for communications equipment surged. The company’s stock rose 8-fold from early 1997 to its peak in September 2000, then lost over 90% of its value during the subsequent 2-year market downturn.
What we learned then was that it wasn’t enough to do great innovations, Wendell Weeks said.
Addressing parallels to the past week’s comments on the current data center build-out and the possibility of a slowdown. He noted that fiber optic demand has grown about 7% annually on average, so we will find a good use for it.
He is also unfazed by Meta’s prospects in this sector. “Ultimately, technical excellence and commitment to compute infrastructure win,” he said.
Built To Withstand Bad Weather
This confidence is reinforced by Corning’s diversified business, which includes some more stable, high-cash-flow businesses in our mix. We are built to withstand bad weather, Weeks said.
Meta Marshall, an analyst covering networking equipment at Morgan Stanley, said there is volatility on the fiber side, but that Corning can likely manage through it.
The market will still need TVs, phones, cars, auto glass, and vials for medications, said Marshall, who has the equivalent of a hold rating on the stock.
Such adaptability has enabled Corning to repeatedly reinvent itself and reach its current position.
Founded during the gold rush era, Corning produced glass for Edison’s light bulbs in the late 1870s and later expanded into Pyrex cookware, car filters, spacecraft windows, TV screens, and vials for COVID-19 vaccines.
Since the launch of the iPhone in 2007, Apple has been a key customer relying on Corning glass for its flagship device. Apple announced a $2.5 billion deal in August to manufacture all iPhone and Apple Watch cover glass at a Corning plant in Harrodsburg, Kentucky.
In 1970, Corning invented the first glass fiber that was useful for long-distance communication. Fiber-based broadband makes up the majority of the Internet’s backbone, with billions of miles of cable linking continents, data centers, businesses, and homes.
Fiber transmits data almost as fast as light, while copper phone lines use electricity to carry signals. Fiber-optic cables use light to send data, enabling much faster speeds and lower power consumption.
Using light instead of electricity uses much less power, between 5 and 20 times less. Weeks said that as power becomes a bigger concern. Fiber gets closer to where data is processed by computers.
You Need To Put In A Lot More Capacity
Fiber increased significantly, driven by AI data centers that require more fiber than traditional cloud infrastructure. In the third quarter, revenue in Corning’s optical communications business rose 33% to $1.65B, and total sales increased to $4.27B. According to Corning’s earnings release, enterprise sales for optical communications grew 58% in the quarter, driven by the continued strong adoption of Corning’s new-gen AI products.
Building on these developments, Weeks described it as a whole separate network designed to create connections similar to those between neurons in the brain.
To meet these connectivity demands, Corning developed a new fiber, Contour, specifically for AI applications, for which Weeks holds the patent. The cable accommodates twice as many fiber strands in a standard conduit and reduces 16 connectors to a single one.
Weeks told CNBC that development of the new AI products began over five years ago, well before the 2022 launch of ChatGPT, after a discussion with a leader in generative AI.
Weeks recalled being advised to significantly increase capacity, though he did not name the individual who made the recommendation. He was told, “This is what’s going to happen and how much compute is going to be needed. How the scaling principles are working.”
Mike O’Dea, Corning’s head of fiber optics, told CNBC the company has produced over 1.3 billion miles of optical fiber. Weeks estimates that Meta’s Louisiana data center alone will require 8 million miles. Meeting this demand is a key challenge for Corning.
It may get even harder as fiber eventually replaces copper inside server racks. This challenge may intensify as fiber is expected to replace copper within server racks, such as those used by N Media. While copper cables currently dominate chip connections within servers, Weeks states that the transition to fiber is inevitable as the number of graphics processors per rack increases into the hundreds. More economical and much more power efficient.
Corning and Meta both report fourth-quarter earnings on Wednesday.
