iPhone 5 Will Likely Have Corning’s Gorilla Glass

Apple (NYSE:AAPL) may use Corning’s (NYSE:GLW) Gorilla Glass as the cover glass for its next iPhone. If this occurs, it will be a very positive development for Corning which is struggling to maintain its margins in a market that has an oversupply of glass. Corning’s Gorilla Glass has adopted extremely well in the market and has become a $700M business within 2 years of its launch. This product has almost tripled in 2011 driven by an industry wide adoption of this glass by the mobile industry. However, it still fell short of the $1B mark predicted by Corning due to weak state of the HDTV (High Definition Television) industry and lower adoption by the players of this industry.

Apple and Corning’s relationship has always been a mystery. The phone manufacturer, in fact, did not even list Corning among its suppliers. But its latest U.S. Jobs report indicates that Apple has indeed used Corning’s Gorilla Glass for its phones.

This official confirmation is good news for Corning which has indicated that it expects a decline in the sales of Gorilla Glass this year. The company has attributed it mainly due to pressure by mobile manufacturers for cheaper components and the continuing weak state of the HDTV industry. This is, in spite of the company coming up with a better version of Gorilla Glass, called Gorilla Glass 2. Gorilla Glass 2 promises to deliver the same durability and scratch surface resistance as its predecessor while being 20% thinner.

Samsung has already announced that it will be using this glass for the Samsung Galaxy S3 which will be launched in the summer of 2012.

See our full analysis of the Corning stock here

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