Mark Zuckerberg's Meta has formed a strategic partnership with Corning in a multi-year deal valued at up to $6 billion. This agreement aims to bolster the supply of fiber-optic cables for Meta’s AI data centers.
As part of this collaboration, Corning will enhance its manufacturing capabilities in North Carolina while increasing its workforce. The partnership will also contribute to Meta's data centers, supporting thousands of construction and operational positions across the U.S.
Meta's Chief Global Affairs Officer emphasized the importance of collaborating with leading partners in American manufacturing to enhance U.S. advancements in the global AI race. The increasing demand for fiber-optic cables is driven by the rapid expansion of AI data centers and hyperscale computing, which require more facilitation than traditional cloud setups.
Corning has reported remarkable growth in its optical communications segment, marked by a 58% surge in enterprise sales recently. The company has introduced innovative products, including a new high-density cable called Contour, specifically designed to meet the extensive connectivity needs arising from AI infrastructure.
Major tech players such as Meta, NVIDIA, OpenAI, Google, Amazon, and Microsoft are significantly growing their data center networks, which drastically increases the demand for fiber.
Corning's stock has shown a robust performance, gaining 75% over the past year, indicating investor confidence. Following the announcement of Meta's partnership, Corning shares experienced an almost 8% increase in premarket trading.
This partnership plays a crucial role in Meta’s strategy involving the construction of 30 U.S. data centers, particularly significant projects in Ohio and Louisiana that will utilize Corning fiber.
Corning's CEO highlighted that this investment not only expands manufacturing in North Carolina but is expected to elevate employment levels in the state by 15 to 20%. This will help maintain a skilled workforce of over 5,000, comprising scientists, engineers, and production teams at two of the world’s largest optical fiber and cable manufacturing sites.
In addition to this partnership, Meta is undergoing a strategic shift. Once focused heavily on its metaverse initiatives, Meta is reallocating resources towards AI, wearable technology, and mobile gaming. This shift reflects their aim to enhance AI development while simplifying their browser-based Horizon Worlds into a more appealing, user-friendly platform for younger audiences, inspired by popular games like Roblox.