Corning Incorporated (NYSE: GLW) today announced results for the
second quarter ended June 30, 2021, and provided an outlook for the
third quarter of 2021.
- GAAP and core sales were $3.5 billion; core sales grew 35% year
over year and 17% versus second-quarter 2019.
- GAAP net income was $449 million and core net income was $459
million.
- GAAP EPS was ($0.42) and core EPS
was $0.53, up 112% year over year and 18% versus second-quarter
2019.
- The difference between GAAP and core
EPS was primarily due to a one-time accounting treatment resulting
from the Samsung Display Co., Ltd. preferred share transaction,
which reduced fully diluted share count by 35 million.
- Gross margin expanded 200 basis points sequentially to 37.8%,
and operating margin expanded 120 basis points sequentially to
18.3%.
- Free cash flow of $471 million grew $186 million year over
year; first-half free cash flow generation was $843 million.
- Looking ahead to the third quarter, the company expects core
sales to be in the range of $3.5 billion to $3.7 billion and core
EPS in the range of $0.54 to $0.59.
“Corning had an outstanding second quarter. We are growing
faster than our underlying markets and achieved a revenue milestone
of $3.5 billion, establishing a strong sales run rate. We are
performing well as we continue to build a stronger, more agile
company that’s consistently delivering meaningful and important
contributions,” said Wendell P. Weeks, chairman and chief executive
officer. “Corning’s deep commitment to life-changing innovation and
our people’s unwavering dedication continue to drive us
forward.”
Tony Tripeny, executive vice president and chief financial
officer, said, “Corning is on track to deliver an outstanding year.
In the second quarter we added almost $1 billion in sales year over
year and a half billion in sales over pre-pandemic levels; we
improved margins year over year and sequentially, contributing to
strong EPS; and we generated significant operating and free cash
flow. We are confident this momentum will continue.”
Tripeny continued, “Our value creation model is working. We
pursue opportunities that utilize capabilities from our focused and
cohesive portfolio to drive growth. By repurposing and reapplying
capabilities, we’re increasing our probability of success, lowering
our cost of innovation, and becoming more capital efficient.”
Market-Access Platform Highlights
Corning continues to advance important growth initiatives across
its Market-Access Platforms. Highlights include:
- Automotive –
Corning is addressing a combined $100-per-car content opportunity
across emissions, precision glass products, and auto-glass
solutions, driven by the company’s More Corning growth strategy.
During the quarter, the company entered a new product category with
its Corning® Curved Mirror Solutions. The innovation is being
adopted in Hyundai Mobis’ head-up display system, featured in the
Hyundai IONIQ 5, to deliver an enhanced digital user
experience.
- Mobile Consumer Electronics
– Corning advanced its More Corning strategy by entering
the mobile device camera optics category. Corning® Gorilla® Glass
with DX and Corning® Gorilla® Glass with DX+ composites enable
high-quality image capture through a unique combination of advanced
optical performance, superior scratch resistance, and durability.
Samsung is the first adopter. Also, during the quarter, Apple
awarded Corning an additional $45 million from its Advanced
Manufacturing Fund – recognizing the two companies’ strong history
of collaboration. Throughout the quarter, more than 20 devices –
including smartphones, wearables, and laptops – launched featuring
Corning® Gorilla® Glass.
- Optical Communications
– Optical Communications has returned to growth as 5G,
fiber-to-the-home, and cloud computing drive greater demand for
Corning’s content. Corning is outperforming the market and
addressing its customers’ toughest challenges. During the quarter,
the company introduced Corning® SMF-28® Contour fiber, which offers
an industry-first combination of superior bendability,
compatibility with other fibers, and low signal loss. Corning also
launched EDGETM Rapid Connect solutions that increase fiber density
and reduce customer installation time by up to 70%.
- Life Sciences –
Life Sciences saw strength across its underlying lab research,
bioprocessing, and diagnostics markets. Cell- and gene-based
therapies and advances in research are creating opportunities for
Corning to capture more value with its innovations. The company is
successfully building its Corning Valor® Glass franchise. During
the quarter, Corning collaborated with Thermo Fisher Scientific and
OPTIMA pharma to demonstrate how Valor Glass contributes to a 67%
increase in vaccine packaging filling speed.
- Display – Corning
continues to experience the most favorable pricing environment in
more than a decade and during the quarter announced its second
increase to display glass substrate prices this year. The company
also hosted an official opening of its Gen 10.5 facility in Wuhan,
China, co-located with a BOE Technology Group plant. Corning’s
Wuhan plant further positions the company to capture demand for
large-size TVs.
Second-Quarter 2021 Results and
Comparisons (In millions, except per-share
amounts)
|
|
Q2 2021 |
|
|
Q1 2021 |
|
|
% change |
|
|
Q2 2020 |
|
|
% change |
|
|
GAAP Net Sales |
|
$ |
3,501 |
|
|
$ |
3,290 |
|
|
|
6% |
|
|
$ |
2,561 |
|
|
|
37% |
|
|
GAAP Net Income (Loss) |
|
$ |
449 |
|
|
$ |
599 |
|
|
|
(25%) |
|
|
$ |
(71 |
) |
|
|
*** |
|
|
GAAP EPS** |
|
$ |
(0.42 |
) |
|
$ |
0.67 |
|
|
|
*** |
|
|
$ |
(0.13 |
) |
|
|
*** |
|
|
Core Sales* |
|
$ |
3,504 |
|
|
$ |
3,263 |
|
|
|
7% |
|
|
$ |
2,588 |
|
|
|
35% |
|
|
Core Net Income* |
|
$ |
459 |
|
|
$ |
402 |
|
|
|
14% |
|
|
$ |
218 |
|
|
|
111% |
|
|
Core
EPS* |
|
$ |
0.53 |
|
|
$ |
0.45 |
|
|
|
18% |
|
|
$ |
0.25 |
|
|
|
112% |
|
|
*Core performance measures are non-GAAP financial measures. The
reconciliation between GAAP and non-GAAP measures is provided in
the tables following this news release, as well as on the company’s
website.
**The difference between GAAP and core EPS was primarily due to
a one-time accounting treatment resulting from the Samsung Display
Co., Ltd. preferred share transaction, which reduced fully diluted
share count by 35 million.
***Not Meaningful
Second-Quarter 2021 Segment
Results
Display Technologies
|
|
Q2 2021 |
|
|
Q1 2021 |
|
|
% change |
|
|
Q2 2020 |
|
|
% change |
|
|
Net Sales |
|
$ |
939 |
|
|
$ |
863 |
|
|
|
9% |
|
|
$ |
753 |
|
|
|
25% |
|
|
Net Income Before Tax |
|
$ |
312 |
|
|
$ |
269 |
|
|
|
16% |
|
|
$ |
193 |
|
|
|
62% |
|
|
Net
Income |
|
$ |
248 |
|
|
$ |
213 |
|
|
|
16% |
|
|
$ |
152 |
|
|
|
63% |
|
|
In Display Technologies, second-quarter sales were $939 million,
up 9% sequentially and 25% year over year. Corning increased glass
substrate prices in the second quarter and implemented an
additional moderate price increase for the third quarter.
Optical Communications
|
|
Q2 2021 |
|
|
Q1 2021 |
|
|
% change |
|
|
Q2 2020 |
|
|
% change |
|
|
Net Sales |
|
$ |
1,075 |
|
|
$ |
937 |
|
|
|
15% |
|
|
$ |
887 |
|
|
|
21% |
|
|
Net Income Before Tax |
|
$ |
188 |
|
|
$ |
142 |
|
|
|
32% |
|
|
$ |
104 |
|
|
|
81% |
|
|
Net
Income |
|
$ |
148 |
|
|
$ |
111 |
|
|
|
33% |
|
|
$ |
81 |
|
|
|
83% |
|
|
In Optical Communications, second-quarter sales were $1.08
billion, up 21% year over year. Sales increased in both enterprise
and carrier networks. 5G, fiber-to-the-home, and cloud computing
continue to drive strong growth across this segment.
Specialty Materials
|
|
Q2 2021 |
|
|
Q1 2021 |
|
|
% change |
|
|
Q2 2020 |
|
|
% change |
|
|
Net Sales |
|
$ |
483 |
|
|
$ |
451 |
|
|
|
7% |
|
|
|
$ |
417 |
|
|
|
16% |
|
|
|
Net Income Before Tax |
|
$ |
103 |
|
|
$ |
115 |
|
|
|
(10%) |
|
|
|
$ |
114 |
|
|
|
(10%) |
|
|
|
Net
Income |
|
$ |
81 |
|
|
$ |
91 |
|
|
|
(11%) |
|
|
|
$ |
90 |
|
|
|
(10%) |
|
|
|
In Specialty Materials, second-quarter sales of $483 million
increased 16% year over year due to strong demand for premium cover
materials, strength in the IT market, and greater optical content
in semiconductor manufacturing. Net income declined
sequentially and year over year, driven by increased investments in
innovation programs that are moving toward commercialization.
Environmental Technologies
|
|
Q2 2021 |
|
|
Q1 2021 |
|
|
% change |
|
|
Q2 2020 |
|
|
% change |
|
|
Net Sales |
|
$ |
407 |
|
|
$ |
441 |
|
|
|
(8%) |
|
|
$ |
226 |
|
|
|
80% |
|
|
Net Income Before Tax |
|
$ |
102 |
|
|
$ |
94 |
|
|
|
9% |
|
|
$ |
0 |
|
|
|
* |
|
|
Net
Income |
|
$ |
81 |
|
|
$ |
74 |
|
|
|
9% |
|
|
$ |
0 |
|
|
|
* |
|
|
*Not Meaningful
In Environmental Technologies, second-quarter sales of $407
million increased 80% year over year, driven by improving markets
and More Corning content. Automotive sales were up 68% year over
year as vehicle production improved from pandemic lows and gasoline
particulate filter adoption continued in Europe and China. Diesel
sales grew 101% year over year, driven by adoption of more advanced
exhaust aftertreatment systems in preparation for China VI
implementation as well as continued strength in the North America
heavy-duty truck market.
Life Sciences
|
|
Q2 2021 |
|
|
Q1 2021 |
|
|
% change |
|
|
Q2 2020 |
|
|
% change |
|
|
Net Sales |
|
$ |
312 |
|
|
$ |
300 |
|
|
|
4% |
|
|
$ |
243 |
|
|
|
28% |
|
|
Net Income Before Tax |
|
$ |
66 |
|
|
$ |
61 |
|
|
|
8% |
|
|
$ |
39 |
|
|
|
69% |
|
|
Net
Income |
|
$ |
52 |
|
|
$ |
48 |
|
|
|
8% |
|
|
$ |
31 |
|
|
|
68% |
|
|
In Life Sciences, second-quarter sales were $312 million, up 28%
year over year. Performance was driven by ongoing recovery in
academic and pharmaceutical research labs and continued strong
demand for bioproduction products and diagnostic-related
consumables.
Upcoming Investor Events
On Sept. 1, Corning will attend the Jefferies Semiconductor, IT
Hardware & Communications Infrastructure Summit. And, on Sept.
14, Corning will attend the Citi 2021 Global Technology Virtual
Conference.
Second-Quarter Conference Call Information
The company will host its second-quarter conference call on
Tuesday, July 27, at 8:30 a.m. EDT. To participate, please call
toll-free (877) 710-0209 or for international access, call (315)
625-3068 approximately 10 to 15 minutes prior to the start of the
call. The access code is 133 0605. To listen to a live audio
webcast of the call, go to Corning’s website at
http://www.corning.com/investor_relations, click “Events,” and
follow the instructions.
Presentation of Information in this News
Release
This news release includes non-GAAP financial measures. Non-GAAP
financial measures are not in accordance with, or an alternative
to, GAAP. Corning’s non-GAAP financial measures exclude the impact
of items that are driven by general economic conditions and events
that do not reflect the underlying fundamentals and trends in the
company’s operations. The company believes presenting non-GAAP
financial measures assists in analyzing financial performance
without the impact of items that may obscure trends in the
company’s underlying performance. Definitions of these non-GAAP
financial measures and reconciliations of these non-GAAP financial
measures to the most directly comparable GAAP financial measures
can be found on the company’s website by going to the Investor
Relations page and clicking “Quarterly Results” under the
“Financials and Filings” tab. These reconciliations also accompany
this news release.
Caution Concerning Forward-Looking
Statements
The statements contained in this release that are not historical
facts or information and contain words such as “will,” “believe,”
“anticipate,” “expect,” “intend,” “plan,” “seek,” “see,” “would,”
and “target” and similar expressions are forward-looking
statements. These forward-looking statements are made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995 and include estimates and assumptions related to
economic, competitive, and legislative developments. Such
statements relate to future events that by their nature address
matters that are, to different degrees, uncertain. These
estimates are subject to change and uncertainty which are, in many
instances, beyond our control. There can be no assurance that
future developments will be in accordance with management’s
expectations. Actual results could differ materially from those
expected by us, depending on the outcome of various factors. We do
not undertake to update forward-looking statements.
Although the company believes that these forward-looking
statements are based upon reasonable assumptions regarding, among
other things, current estimates and forecasts, general economic
conditions, its knowledge of its business, and key performance
indicators that impact the company, actual results could differ
materially. The company does not undertake to update
forward-looking statements. Some of the risks, uncertainties
and other factors that could cause actual results to differ
materially from those expressed in or implied by the
forward-looking statements include, but are not limited to: the
duration and severity of the COVID-19 pandemic, and its impact
across our businesses on demand, operations and our global supply
chains; the effects of acquisitions, dispositions and other similar
transactions; global business, financial, economic and political
conditions; tariffs and import duties; currency fluctuations
between the U.S. dollar and other currencies, primarily the
Japanese yen, new Taiwan dollar, euro, Chinese yuan and South
Korean won; product demand and industry capacity; competitive
products and pricing; availability and costs of critical components
and materials; new product development and commercialization; order
activity and demand from major customers; the amount and timing of
our cash flows and earnings and other conditions, which may affect
our ability to pay our quarterly dividend at the planned level or
to repurchase shares at planned levels; possible disruption in
commercial activities due to terrorist activity, cyber-attack,
armed conflict, political or financial instability, natural
disasters, or major health concerns; loss of intellectual property
due to theft, cyber-attack, or disruption to our information
technology infrastructure; unanticipated disruption to our supply
chain, equipment, facilities, IT systems or operations; effect of
regulatory and legal developments; ability to pace capital spending
to anticipated levels of customer demand; rate of technology
change; ability to enforce patents and protect intellectual
property and trade secrets; adverse litigation; product and
components performance issues; retention of key personnel; customer
ability, to maintain profitable operations and obtain financing to
fund ongoing operations and manufacturing expansions and pay
receivables when due; loss of significant customers; changes in tax
laws and regulations; the impacts of audits by taxing authorities;
the potential impact of legislation, government regulations, and
other government action and investigations; and other risks
detailed in Corning’s SEC filings.
For a complete listing of risks and other factors, please
reference the risk factors and forward-looking statements described
in our annual reports on Form 10-K and quarterly reports on Form
10-Q.
Web Disclosure
In accordance with guidance provided by the SEC regarding the
use of company websites and social media channels to disclose
material information, Corning Incorporated (“Corning”) wishes to
notify investors, media, and other interested parties that it uses
its website
(https://www.corning.com/worldwide/en/about-us/news-events.html) to
publish important information about the company, including
information that may be deemed material to investors, or
supplemental to information contained in this or other press
releases. The list of websites and social media channels that the
company uses may be updated on Corning’s media and website from
time to time. Corning encourages investors, media, and other
interested parties to review the information Corning may publish
through its website and social media channels as described above,
in addition to the company’s SEC filings, press releases,
conference calls, and webcasts.
About Corning Incorporated
Corning (www.corning.com) is one of the world's leading
innovators in materials science, with a 170-year track record of
life-changing inventions. Corning applies its unparalleled
expertise in glass science, ceramic science, and optical physics
along with its deep manufacturing and engineering capabilities to
develop category-defining products that transform industries and
enhance people's lives. Corning succeeds through sustained
investment in RD&E, a unique combination of material and
process innovation, and deep, trust-based relationships with
customers who are global leaders in their industries. Corning's
capabilities are versatile and synergistic, which allows the
company to evolve to meet changing market needs, while also helping
our customers capture new opportunities in dynamic industries.
Today, Corning's markets include optical communications, mobile
consumer electronics, display, automotive, and life sciences.
Media Relations
Contact: Megan
Whittemore (202)
661-4171 whittemom@corning.com
Investor
Relations Contact:Ann H.S. Nicholson (607) 974-6716
nicholsoas@corning.com
- Q2 2021 Earnings Release Financials
- Q2 2021 Earnings Infographic
- Second-Quarter 2021 Earnings Release
Corning (NYSE:GLW)
Historical Stock Chart
From Mar 2024 to Apr 2024
Corning (NYSE:GLW)
Historical Stock Chart
From Apr 2023 to Apr 2024