NEW YORK, March 5, 2026, 11:53 EST
- Corning shares slipped after Broadcom’s CEO downplayed the immediate need for optical links within AI racks.
- Corning’s CFO this week acknowledged the “scale-up” process will take longer, though he also outlined a more ambitious plan for 2028.
- Analysts aren’t calling the shift to co-packaged optics dead—just pushed back further than they’d expected.
Corning Incorporated dropped roughly 4.4% to $138.43 around 11:40 a.m. ET Thursday. Broadcom gained 5.3%, while Ciena, another optical-networking player, tumbled about 15.2%. On Broadcom’s earnings call, CEO Hock Tan told analysts that customers still favor direct-attached copper for “scale-up” connections within AI racks, adding, “CPOs will come in its time. Not this year, maybe not next year.” The Motley Fool
The selloff is significant—Corning has turned into a favorite for investors betting on AI data-center expansion, where data transfer speeds can hit the limits of power efficiency. The prevailing market thesis is straightforward: ramped-up AI should drive demand for connectivity gear, and, ultimately, more fiber.
Just two days back, Corning CFO Ed Schlesinger told a Morgan Stanley event the company had revised its Springboard plan and now aims for about $24 billion in revenue by 2028. On the AI networking side, Schlesinger flagged that “I don’t think we’re gonna see scale up … for a couple years,” pointing to a possible bigger inflection point nearer to 2028, though “scale-out” demand is still gathering steam. Investing.com
“Scale-out” forms the backbone linking racks throughout the data hall. Inside each rack, “scale-up” comes into play, wiring accelerators together over short runs—where every watt, dollar, and nanosecond matters. Co-packaged optics, or CPO, moves optical links right up to the chip package, aiming for lower power draw and higher bandwidth.
Corning and Broadcom are teaming up on co-packaged optics in 2025, with Corning providing the optical parts for Broadcom’s Bailly CPO system. Corning’s design targets higher interconnection density and lower power use in large AI clusters, the company said.
The tug-of-war has become all about timing. Copper’s resilience could outlast investor forecasts, yet there’s still space for shifts in perception across the rest of the network.
Analysts pointed out the remarks aligned with a gradual adoption trend that’s been forming. “CPO adoption is still likely 2-3 years away from seeing a meaningful inflection,” William Blair’s Sebastien Naji wrote. Barron’s
Corning’s strategy lately has included locking in multi-year supply deals with major AI players. Back in January, Meta Platforms agreed to spend up to $6 billion on Corning’s fiber-optic cables and related equipment for its AI data centers. CEO Wendell Weeks described the agreement as a move to “strengthen domestic supply chains.” Reuters
The catch is timing. Should hyperscalers stick with copper in racks for longer, or pull back on fresh cluster spending, Corning might not see its optical growth kick in as soon—or as steadily—as hoped. Pricing that risk isn’t straightforward.
Corning sits at a crossroads. Yes, fiber demand between racks is climbing, but actually getting inside the rack could take more time. Thursday, the market made it clear which narrative gets the spotlight first.
