Corning (GLW 3.19%) has manufactured glass right here in America since 1851. By 1880, it was the sole supplier of glass for Thomas Edison’s original lightbulb, and today, it makes the glass for all of Apple‘s iPhones.

However, Corning stock has soared by 230% over the past 12 months because of red-hot demand for the company’s fiber-optic cables for data centers, which help accelerate processing speeds in artificial intelligence (AI) workloads.

On Monday, June 8, Amazon announced a multiyear deal to purchase billions of dollars’ worth of Corning’s optical connectivity solutions, joining Meta Platforms and Nvidia, which have recently made large commitments of their own. These deals could fuel explosive growth in Corning’s revenue and earnings, so should investors buy its stock right now?

Fiber is the future of AI connectivity

Nvidia’s flagship NVLink 72 data center rack includes 72 graphics processing units (GPUs), 36 central processing units (CPUs), and a series of networking components. It’s all connected using two miles of copper cables, but there is an ongoing shift toward fiber-optic cables instead, because they can transmit data faster and farther, while consuming far less energy.

Corning recently launched a new product called Multicore Fiber (MCF), which packs four cores into a single 125-micron strand of optical fiber. By increasing the density fourfold compared to a single-core solution, data center operators can achieve the same performance with 75% fewer cables. This could be a game changer in the AI era.

Amazon hasn’t disclosed the exact value of its recent deal, but we can piece together a few clues. In a conference call with investors on April 28, Corning CEO Wendell Weeks highlighted two new, recently signed deals of similar size and scope to its Meta agreement, and we already know Meta plans to buy around $6 billion worth of optical connectivity solutions over the next few years. In my opinion, we can now safely assume one of those other two customers is Amazon.

Plus, in May, Nvidia signed a deal to help Corning expand its U.S.-based optical connectivity manufacturing capacity tenfold, which is an indication of how much supply will be required to fulfill the orders from its hyperscale customers.

Corning’s optical communications business could generate explosive growth

Corning’s optical communications segment generated $1.8 billion in revenue during the first quarter of 2026, which was a 36% increase from the year-ago period. It grew at twice the pace of the company’s total core revenue, which increased by 18% to come in at $4.3 billion during the quarter.

Since demand for optical connectivity solutions is so high, Corning has the ability to dictate prices, which is lifting its profit margins. That’s why its optical communications segment was able to deliver $387 million in net income during the first quarter, which was up by 93%. It accounted for more than half of the company’s total core net income of $612 million.

If we assume the Amazon purchase agreement is worth around $6 billion just like the Meta deal, then Corning’s optical communications business has an order pipeline of at least $12 billion. However, keep in mind the company has signed at least one more hyperscale deal that is yet to be announced, based on comments by Weeks I highlighted earlier. Therefore, investors can expect significant growth in the optical communications business at both the top and bottom lines in the coming years.

Beware of Corning’s valuation

Based on Corning’s trailing-12-month adjusted (non-GAAP) earnings of $2.69 per share, its stock is trading at a price-to-earnings (P/E) ratio of 61.7, making it twice as expensive as Nvidia, which has a P/E of 30.7.

Corning

Today’s Change

(-3.19%) $-5.55

Current Price

$168.38

Wall Street expects Corning to grow its earnings to $4.19 per share in 2027 (according to Yahoo! Finance), placing its stock at a more reasonable forward P/E ratio of 39.6, but that’s still higher than Nvidia’s P/E today. In other words, investors are pricing in a ton of future growth based on the company’s deal pipeline, which might not come until 2028 and beyond.

Buying a stock today in the hope it grows into its valuation in two years (or more) is a risky strategy. Investors have to assume Corning executes flawlessly to turn its deal pipeline into revenue and earnings, and they also have to assume the demand for AI hardware will be as strong as it is today — except it’s already showing cracks.

As a result, investors might want to avoid Corning stock unless they feel confident they can hold it for at least five years, which will smooth out some of the volatility that could be ahead.