Apple supplier Corning beat profit estimates for the first quarter on Tuesday as the specialty glassmaker’s price hikes more than made up for higher raw material costs and a demand decline.
Shares of the company, whose Gorilla glass is used in Apple’s revolutionary iPhones, rose 2% in premarket trading.
Price increases meant that “profitability improved despite sequentially lower sales, which were impacted by recession-level demand in several key markets and overall weakness in China, as anticipated,” CEO and Chairman Wendell Weeks said.
Core gross margin increased by 160 basis points sequentially to 35.2% in the first three months of the year, helping Corning post an adjusted profit of 41 cents per share that was more than expectations of 39 cents, according to Refinitiv data.
The company said it expects the pricing action and a recovery in the display technologies business to drive an increase in second-quarter sales and profitability.
MacDailyNews Take: Corning gave a net sales guidance range of between $3.4 billion and $3.6 billion for the second quarter vs. analysts’ consensus estimate of $3.58 billion.
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