GT Advanced Technologies to Supply Sapphire Glass for Apple
Sapphire glass is harder than the current favorite among mobile device makers and the bulk of that comes from Corning Inc. (NYSE: GLW), makers of the branded Gorilla Glass. The Moto X smartphone from Google Inc. (NASDAQ: GOOG) uses sapphire glass for its front cover and many other makers use the material for camera lens covers and Apple already uses sapphire glass for its fingerprint sensor on the iPhone 5S.
Apple will provide $578 million in financing for GT, which will own and operate the required furnaces and related equipment in a facility owned by Apple. The deal marks another move by Apple to repatriate some of its manufacturing to the U.S. The GT plant expects to employ 700 workers
Demand for sapphire glass is expected to rise by 50% by 2016, and GT expects the contract with Apple to have a positive impact on earnings starting next year. GT, long a supplier to the crystalline solar makers, has suffered a sharp downturn in its business since the price of solar modules collapsed. The stock’s price peaked at nearly $20 in July of 2008 before starting a decline that only bottomed out early this year.
Shares of GT are up about 19% in mid-afternoon trading Tuesday at $10.00 after posting a new 52-week high of $10.60 earlier. The stock’s 52-week low is $2.61.
Corning’s shares are down about 3.6% at $16.64 in a 52-week range of $10.71 to $18.07.