NEW YORK (TheStreet) -- GT Advanced Technologies (GTAT) rocketed 22.2% to $10.24 as investors celebrate news of its $578 million deal with Apple (AAPL). Current Apple supplier Corning (GLW) fell on back of the deal, while GT competitor Rubicon Technology (RBCN) soared in response.
The multi-year contract requires GT to supply Apple with significant volumes of sapphire, the material used to protect delicate features of Apple's hardware such as the iPhone 5s' TouchID and camera lens. The inking of this agreement suggests Apple will begin to use the material on a larger scale across its hardware line, potentially replacing Gorilla Glass in its iDevices, and even in the oft-rumored iWatch.
"We believe that it is in the long-term best interests of our company, employees and shareholders to build a robust sapphire materials business with recurring revenues," said GT CEO Tom Gutierrez in a statement.
As part of the deal, GT will produce sapphire material out of Apple's Mesa, Arizona facility, using the latter's $578 million capital injection. GT is expected to reimburse the amount over five years ending 2020.
The news weighed on Corning, the supplier of Gorilla Glass which currently outfits iPad and iPhone models with its Gorilla Glass product. Investment firm Cantor Fitzgerald defended the stock, rationalizing it would be too expensive for Apple to replace the displays in each of its models over the coming quarters. Shares tumbled 2.9% to $16.76.
GT competitor Rubicon Technology, a sapphire substrate manufacturer, shot up on the news, gaining 27.3% to $11.23.