Apple iPhone glass maker Corning says smartphone sales are plummeting

Corning

In an earnings call, the company reported lower-than-expected results for the current quarter and blamed it on low smartphone glass sales. The company blames it all on a 14% year-over-year decrease in smartphone sales volume and a 17% drop in orders for tablets and laptops glass.

Corning CEO Wendell Weeks doesn't expect improvement through the end of the 2022.

"We now expect smartphones to be down about 12% for the year, and we expect notebook and tablet demand to decline 15%," Weeks said. "We expect the year-over-year decline in smartphones, notebooks, and tablets to be greater in the second half than in the first half."

Corning reported third-quarter sales of $3.49 billion, below the consensus of $3.66 billion. However, adjusted earnings-per-share was 51 cents, in line with expectations. Its stock dropped 4% on Tuesday when it said its expectation for the fourth fiscal quarter of 2022 was $3.55 billion in core sales, lower than a FactSet analyst consensus of $3.75 billion.

Corning produces a large percentage of smartphone displays for companies - including Apple - but its report isn't a direct reflection of Apple sales. Analysts from JP Morgan, Cowen, and Morgan Stanley all agree that premium smartphones, like the iPhone 14 Pro and iPhone 14 Pro Max, are doing great.

As of October 2, the iPhone 14, Pro, and Pro Max delivery times averaged across all regions were two days, 33 days, and 40 days respectively. Since its launch on October 7, the iPhone 14 Plus lead times have been six days in the US.

Erik Woodring from Morgan Stanley forecasts $90.1 billion in revenue for Apple's September quarter, which does not suggest poor iPhone sales. The estimate is 2% higher than Wall Street's forecast of $88.4 billion, and if accurate, would be record-breaking for the quarter.

But, time will tell what the actual numbers are. Apple will report its financial results in an earnings call on October 27 at 2:00 PM Pacific, 5:00 PM Eastern.