Corning Reports First-Quarter 2024 Financial Results
Management reaffirms expectation that first-quarter sales will mark the low point of the year, as improving market conditions support higher sales throughout 2024
Management expects core sales to grow sequentially to approximately
Weeks continued, “We are executing our plans to add more than
First-Quarter 2024 Financial Highlights:
-
GAAP sales were
$2.98 billion . Core sales were$3.26 billion . Year over year, GAAP and core sales declined by 6% and 3%, respectively. - Profitability improved despite the lower sales, reflecting the continued benefit of pricing and productivity improvement actions. Year over year, GAAP gross margin improved by 180 basis points and core gross margin improved by 160 basis points.
-
GAAP EPS was
$0.24 , and core EPS was$0.38 . The difference between GAAP and core EPS primarily reflected constant-currency adjustments, translated earnings contract gains, and translation gains on Japanese-yen-denominated debt. -
GAAP operating cash flow was
$96 million , and adjusted free cash flow was$(62) million – both significantly improved versus the first quarter of 2023.
Second-Quarter 2024 Outlook:
-
For the second quarter, management expects core sales to grow to approximately
$3.4 billion , with core EPS in the range of$0.42 to$0.46 .
Schlesinger continued, “Overall, we have established a significantly stronger profitability and cash flow base, and we expect to grow from first-quarter levels. In the second quarter, we expect core sales of approximately
Strategy in Action
Corning strives to be a catalyst for positive change and to help move the world forward. The company drives profitable multiyear growth by inventing, making, and selling life-changing products while cultivating deep, trust-based relationships with industry leaders, ultimately incorporating more content into customers’ offerings. Corning takes the long view, investing in a set of vital capabilities that are increasingly relevant to profound transformations that touch many facets of daily life. Today, Corning’s markets include optical communications, mobile consumer electronics, display, automotive, solar, semiconductor, and life sciences.
Recent highlights include:
-
Advancing “More Corning” content opportunities by helping automakers meet ever-tightening pollution standards to produce cleaner vehicles. The
U.S. Environmental Protection Agency’s final multipollutant tailpipe emissions standards for cars and trucks, announced in March, include a strong particulate emissions limit that will require the deployment of gasoline particulate filters in theU.S. for all gasoline vehicles, including hybrids, beginning in 2027. Corning is the inventor of and clear market leader in GPFs, and the new regulations add two to three times the opportunity for emissions-control content in gasoline vehicles, including hybrids.
-
Innovating to enable faster deployments and higher-density solutions needed for fiber-rich networks supporting growth in broadband, 5G, and generative AI. Corning introduced RocketRibbon® cable with Flow Ribbon Technology, featuring a 60% reduction in cable diameter. Smaller, denser cables are ideal for solving the AI-driven infrastructure challenges of carrier and data center customers. Corning also launched its latest connectivity advancement, Multifiber Pushlok™ Technology, with innovative features that make it faster, easier, and up to
$25 less expensive per home to deploy optical fiber and expand broadband access. In related media coverage, a recentCBS News “60 Minutes” segment featuringU.S. Secretary of CommerceGina Raimondo andCorning Chairman and CEOWendell P. Weeks spotlighted Corning’s collaboration with theWhite House to bring high-speed internet to underserved rural communities as part of the Broadband Equity Access and Deployment (BEAD) program. The industry expects funding approvals to begin late this year, leading to spending in 2025. Corning anticipates BEAD-related projects will add significantly to the company’s addressable market.
First-Quarter 2024 Results and Comparisons |
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(In millions, except per-share amounts) |
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Results (GAAP) |
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Q1 2024 |
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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Y/Y |
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|
|
|
|
|
|
|
|
|
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(1%) |
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(6%) |
|
Net Income (Loss) (1) |
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|
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* |
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19% |
|
Diluted EPS |
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* |
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20% |
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(1) Represents GAAP net income (loss) attributable to |
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* Not meaningful |
Core Results (Non-GAAP) |
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Q1 2024 |
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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Y/Y |
|
Core Sales (1) |
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|
|
|
|
|
|
|
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— |
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(3%) |
|
Core Net Income (1) |
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(3%) |
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(6%) |
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Core EPS (1) |
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(3%) |
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(7%) |
|
(1) 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. |
First-Quarter 2024 Segment Results |
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(In millions) |
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The first-quarter results below are prepared on a basis consistent with Corning’s segment reporting as presented in the company’s consolidated financial statements. |
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Q1 2024 |
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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Y/Y |
|
|
|
|
|
|
|
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3% |
|
|
(17%) |
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Net Income |
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|
|
|
14% |
|
|
(37%) |
|
In
Display Technologies |
|
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Q1 2024 |
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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Y/Y |
|
|
|
|
|
|
|
|
|
|
|
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— |
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|
14% |
|
Net Income |
|
|
|
|
|
|
|
|
|
|
(13%) |
|
|
26% |
|
In Display Technologies, first-quarter sales were
Specialty Materials |
|
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|
Q1 2024 |
|
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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Y/Y |
|
|
|
|
|
|
|
|
|
|
|
|
(4%) |
|
|
12% |
|
Net Income |
|
|
|
|
|
|
|
|
|
|
(24%) |
|
|
13% |
|
In Specialty Materials, first-quarter sales were
Environmental Technologies |
|
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|
|
Q1 2024 |
|
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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|
Y/Y |
|
|
|
|
|
|
|
|
|
|
|
|
6% |
|
|
6% |
|
Net Income |
|
|
|
|
|
|
|
|
|
|
7% |
|
|
28% |
|
In Environmental Technologies, first-quarter sales were
Life Sciences |
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Q1 2024 |
|
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Q4 2023 |
|
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Q1 2023 |
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Q/Q |
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Y/Y |
|
|
|
|
|
|
|
|
|
|
|
|
(2%) |
|
|
(8%) |
|
Net Income |
|
|
|
|
|
|
|
|
|
|
(24%) |
|
|
44% |
In Life Sciences, first-quarter sales were
Hemlock and Emerging Growth Businesses |
|
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Q1 2024 |
|
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Q4 2023 |
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Q1 2023 |
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Q/Q |
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Y/Y |
|
|
|
|
|
|
|
|
|
|
|
|
(13%) |
|
|
(19%) |
|
Net (Loss) Income |
|
|
|
|
|
|
|
|
|
|
47% |
|
|
* |
|
* Not meaningful |
In Hemlock and Emerging Growth Businesses, first-quarter sales were
Upcoming Investor Events
On
First-Quarter Conference Call Information
The company will host its first-quarter conference call on
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.
With respect to the outlook for future periods, it is not possible to provide reconciliations for these non-GAAP measures because management does not forecast the movement of foreign currencies against the
Caution Concerning Forward-Looking Statements
The statements contained in this release and related comments by management that are not historical facts or information and contain words such as “will,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “seek,” “see,” “would,” “target,” “estimate,” “forecast” or 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 forward-looking statements relate to, among other things, the company’s future operating performance, the company’s share of new and existing markets, the company’s revenue and earnings growth rates, the company’s ability to innovate and commercialize new products, the company’s expected capital expenditure and the company’s implementation of cost-reduction initiatives and measures to improve pricing, including the optimization of the company’s manufacturing capacity.
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, there can be no assurance that these forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change except as required by applicable securities laws.
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: global economic trends, competition and geopolitical risks, or an escalation of sanctions, tariffs or other trade tensions between the
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
About
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 its customers capture new opportunities in dynamic industries. Today, Corning’s markets include optical communications, mobile consumer electronics, display, automotive, solar, semiconductors, and life sciences.
Consolidated Statements of Income |
|
(Unaudited; in millions, except per share amounts) |
|
|
|
Three months ended |
|
|||||
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Net sales |
|
$ |
2,975 |
|
|
$ |
3,178 |
|
Cost of sales |
|
|
1,982 |
|
|
|
2,175 |
|
|
|
|
|
|
|
|
|
|
Gross margin |
|
|
993 |
|
|
|
1,003 |
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
|
451 |
|
|
|
421 |
|
Research, development and engineering expenses |
|
|
258 |
|
|
|
254 |
|
Amortization of purchased intangibles |
|
|
30 |
|
|
|
31 |
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
254 |
|
|
|
297 |
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
12 |
|
|
|
7 |
|
Interest expense |
|
|
(83 |
) |
|
|
(76 |
) |
Translated earnings contract gain (loss), net |
|
|
39 |
|
|
|
(8 |
) |
Other income, net |
|
|
74 |
|
|
|
8 |
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
296 |
|
|
|
228 |
|
Provision for income taxes |
|
|
(71 |
) |
|
|
(37 |
) |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
225 |
|
|
$ |
191 |
|
|
|
|
|
|
|
|
|
|
Net income attributable to non-controlling interest |
|
|
(16 |
) |
|
|
(15 |
) |
|
|
|
|
|
|
|
|
|
Net income attributable to |
|
$ |
209 |
|
|
$ |
176 |
|
|
|
|
|
|
|
|
|
|
Earnings per common share available to common shareholders: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.25 |
|
|
$ |
0.21 |
|
Diluted |
|
$ |
0.24 |
|
|
$ |
0.20 |
|
Consolidated Balance Sheets |
|
(Unaudited; in millions, except share and per share amounts) |
|
|
|
|
|
|
|
|
||
|
|
2024 |
|
|
2023 |
|
||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,365 |
|
|
$ |
1,779 |
|
Trade accounts receivable, net of doubtful accounts |
|
|
1,621 |
|
|
|
1,572 |
|
Inventories |
|
|
2,713 |
|
|
|
2,666 |
|
Other current assets |
|
|
1,272 |
|
|
|
1,195 |
|
Total current assets |
|
|
6,971 |
|
|
|
7,212 |
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net of accumulated depreciation |
|
|
14,199 |
|
|
|
14,630 |
|
|
|
|
2,370 |
|
|
|
2,380 |
|
Other intangible assets, net |
|
|
871 |
|
|
|
905 |
|
Deferred income taxes |
|
|
1,132 |
|
|
|
1,153 |
|
Other assets |
|
|
2,075 |
|
|
|
2,220 |
|
|
|
|
|
|
|
|
|
|
Total Assets |
|
$ |
27,618 |
|
|
$ |
28,500 |
|
|
|
|
|
|
|
|
|
|
Liabilities and Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Current portion of long-term debt and short-term borrowings |
|
$ |
318 |
|
|
$ |
320 |
|
Accounts payable |
|
|
1,476 |
|
|
|
1,466 |
|
Other accrued liabilities |
|
|
2,381 |
|
|
|
2,533 |
|
Total current liabilities |
|
|
4,175 |
|
|
|
4,319 |
|
|
|
|
|
|
|
|
|
|
Long-term debt |
|
|
7,050 |
|
|
|
7,206 |
|
Postretirement benefits other than pensions |
|
|
399 |
|
|
|
398 |
|
Other liabilities |
|
|
4,435 |
|
|
|
4,709 |
|
Total liabilities |
|
|
16,059 |
|
|
|
16,632 |
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
Shareholders’ equity: |
|
|
|
|
|
|
|
|
Common stock – Par value |
|
|
917 |
|
|
|
916 |
|
Additional paid-in capital – common stock |
|
|
16,998 |
|
|
|
16,929 |
|
Retained earnings |
|
|
16,358 |
|
|
|
16,391 |
|
|
|
|
(20,672 |
) |
|
|
(20,637 |
) |
Accumulated other comprehensive loss |
|
|
(2,375 |
) |
|
|
(2,048 |
) |
|
|
|
11,226 |
|
|
|
11,551 |
|
Non-controlling interest |
|
|
333 |
|
|
|
317 |
|
Total equity |
|
|
11,559 |
|
|
|
11,868 |
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Equity |
|
$ |
27,618 |
|
|
$ |
28,500 |
|
Consolidated Statements of Cash Flows |
|
(Unaudited; in millions) |
|
|
|
Three months ended |
|
|||||
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Cash Flows from Operating Activities: |
|
|
|
|
|
|
|
|
Net income |
|
$ |
225 |
|
|
$ |
191 |
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
|
Depreciation |
|
|
307 |
|
|
|
310 |
|
Amortization of purchased intangibles |
|
|
30 |
|
|
|
31 |
|
Severance payments |
|
|
(41 |
) |
|
|
(20 |
) |
Share-based compensation expense |
|
|
60 |
|
|
|
52 |
|
Translation gain on Japanese yen-denominated debt |
|
|
(81 |
) |
|
|
(18 |
) |
Deferred tax provision (benefit) |
|
|
10 |
|
|
|
(38 |
) |
Translated earnings contract (gain) loss, net |
|
|
(39 |
) |
|
|
8 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
Trade accounts receivable |
|
|
(161 |
) |
|
|
(28 |
) |
Inventories |
|
|
(86 |
) |
|
|
17 |
|
Other current assets |
|
|
2 |
|
|
|
(62 |
) |
Accounts payable and other current liabilities |
|
|
(73 |
) |
|
|
(369 |
) |
Customer deposits and government incentives |
|
|
(25 |
) |
|
|
(17 |
) |
Deferred income |
|
|
(34 |
) |
|
|
(6 |
) |
Other, net |
|
|
2 |
|
|
|
(100 |
) |
Net cash provided by (used in) operating activities |
|
|
96 |
|
|
|
(49 |
) |
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities: |
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
(252 |
) |
|
|
(382 |
) |
Proceeds from sale of equipment to related party |
|
|
|
|
|
|
67 |
|
Realized gains on translated earnings contracts and other |
|
|
94 |
|
|
|
81 |
|
Other, net |
|
|
(26 |
) |
|
|
6 |
|
Net cash used in investing activities |
|
|
(184 |
) |
|
|
(228 |
) |
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities: |
|
|
|
|
|
|
|
|
Repayments of debt |
|
|
(37 |
) |
|
|
(69 |
) |
Proceeds from other financing arrangements |
|
|
|
|
|
|
54 |
|
Payments of employee withholding tax on stock awards |
|
|
(34 |
) |
|
|
(16 |
) |
Proceeds from exercise of stock options |
|
|
13 |
|
|
|
16 |
|
Dividends paid |
|
|
(243 |
) |
|
|
(239 |
) |
Other, net |
|
|
(7 |
) |
|
|
6 |
|
Net cash used in financing activities |
|
|
(308 |
) |
|
|
(248 |
) |
Effect of exchange rates on cash |
|
|
(18 |
) |
|
|
|
|
Net decrease in cash and cash equivalents |
|
|
(414 |
) |
|
|
(525 |
) |
Cash and cash equivalents at beginning of period |
|
|
1,779 |
|
|
|
1,671 |
|
Cash and cash equivalents at end of period |
|
$ |
1,365 |
|
|
$ |
1,146 |
|
|
|
GAAP Earnings per Common Share |
||||||||
(Unaudited; in millions, except per share amounts) |
||||||||
The following table sets forth the computation of basic and diluted earnings per common share: |
||||||||
|
|
Three months ended |
|
|||||
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Net income attributable to |
|
$ |
209 |
|
|
$ |
176 |
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding - basic |
|
|
852 |
|
|
|
844 |
|
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
Stock options and other awards |
|
|
10 |
|
|
|
15 |
|
Weighted-average common shares outstanding - diluted |
|
|
862 |
|
|
|
859 |
|
Basic earnings per common share |
|
$ |
0.25 |
|
|
$ |
0.21 |
|
Diluted earnings per common share |
|
$ |
0.24 |
|
|
$ |
0.20 |
|
Core Earnings per Share |
||||||||
(Unaudited; in millions, except per share amounts) |
||||||||
The following table sets forth the computation of core earnings per share: |
||||||||
|
|
Three months ended |
|
|||||
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Core net income |
|
$ |
330 |
|
|
$ |
350 |
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding - basic |
|
|
852 |
|
|
|
844 |
|
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
Stock options and other awards |
|
|
10 |
|
|
|
15 |
|
Weighted-average common shares outstanding - diluted |
|
|
862 |
|
|
|
859 |
|
Core earnings per share |
|
$ |
0.38 |
|
|
$ |
0.41 |
|
CORE PERFORMANCE MEASURES
In managing the Company and assessing our financial performance, we adjust certain measures included in our consolidated financial statements to exclude specific items to arrive at our core performance measures. These items include the impact of translating the Japanese yen-denominated debt, the impact of the translated earnings contracts, acquisition-related costs, certain discrete tax items and other tax-related adjustments, restructuring, impairment and other charges and credits, certain litigation, regulatory and other legal matters, pension mark-to-market adjustments and other items which do not reflect the ongoing operating results of the Company.
In addition, because a significant portion of our revenues and expenses are denominated in currencies other than the
The constant-currency rates established for our core performance measures are internally derived long-term management estimates, which are closely aligned with our hedging instrument rates. These hedging instruments may include, but are not limited to, foreign exchange forward or option contracts and foreign-denominated debt. For details of the rates used, please see the footnotes to the “Reconciliation of Non-GAAP Measures” section. We believe that the use of constant-currency reporting allows management to understand our results without the volatility of currency fluctuations, analyze underlying trends in the businesses and establish operational goals and forecasts.
Core performance measures are not prepared in accordance with accounting principles generally accepted in
For a reconciliation of non-GAAP performance measures to their most directly comparable GAAP financial measure, please see “Reconciliation of Non-GAAP Measures.”
Reconciliation of Non-GAAP Measures |
|
(Unaudited; in millions, except per share amounts) |
|
|
|
Three months ended |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
attributable |
|
|
|
|
|
|
|
|
|
|
|
|
Net |
|
|
Income before |
|
|
to Corning |
|
|
Effective tax |
|
|
Per |
|
|||||
|
|
sales |
|
|
income taxes |
|
|
Incorporated |
|
|
rate (a)(b) |
|
|
share |
|
|||||
As reported – GAAP |
|
$ |
2,975 |
|
|
$ |
296 |
|
|
$ |
209 |
|
|
|
24.0 |
% |
|
$ |
0.24 |
|
Constant-currency adjustment (1) |
|
|
283 |
|
|
|
226 |
|
|
|
172 |
|
|
|
|
|
|
|
0.20 |
|
Translation gain on Japanese yen-denominated debt (2) |
|
|
|
|
|
|
(81 |
) |
|
|
(62 |
) |
|
|
|
|
|
|
(0.07 |
) |
Translated earnings contract gain (3) |
|
|
|
|
|
|
(39 |
) |
|
|
(30 |
) |
|
|
|
|
|
|
(0.03 |
) |
Acquisition-related costs (4) |
|
|
|
|
|
|
32 |
|
|
|
24 |
|
|
|
|
|
|
|
0.03 |
|
Discrete tax items and other tax-related adjustments (5) |
|
|
|
|
|
|
|
|
|
|
15 |
|
|
|
|
|
|
|
0.02 |
|
Restructuring, impairment and other charges and credits (6) |
|
|
|
|
|
|
(9 |
) |
|
|
(7 |
) |
|
|
|
|
|
|
(0.01 |
) |
Litigation, regulatory and other legal matters (7) |
|
|
|
|
|
|
(5 |
) |
|
|
(4 |
) |
|
|
|
|
|
|
(0.00 |
) |
Pension mark-to-market adjustment (8) |
|
|
|
|
|
|
11 |
|
|
|
8 |
|
|
|
|
|
|
|
0.01 |
|
Loss on investments (9) |
|
|
|
|
|
|
5 |
|
|
|
5 |
|
|
|
|
|
|
|
0.01 |
|
Core performance measures |
|
$ |
3,258 |
|
|
$ |
436 |
|
|
$ |
330 |
|
|
|
20.2 |
% |
|
$ |
0.38 |
|
(a) |
Based upon statutory tax rates in the specific jurisdiction for each event. |
(b) |
The calculation of the effective tax rate (“ETR”) for GAAP and Core excludes net income attributable to non-controlling interest (“NCI”) of approximately |
|
|
Three months ended |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
attributable |
|
|
|
|
|
|
|
|
|
|
|
|
Net |
|
|
Income before |
|
|
to Corning |
|
|
Effective tax |
|
|
Per |
|
|||||
|
|
sales |
|
|
income taxes |
|
|
Incorporated |
|
|
rate (a)(b) |
|
|
share |
|
|||||
As reported - GAAP |
|
$ |
3,178 |
|
|
$ |
228 |
|
|
$ |
176 |
|
|
|
16.2 |
% |
|
$ |
0.20 |
|
Constant-currency adjustment (1) |
|
|
189 |
|
|
|
149 |
|
|
|
114 |
|
|
|
|
|
|
|
0.13 |
|
Translation gain on Japanese yen-denominated debt (2) |
|
|
|
|
|
|
(18 |
) |
|
|
(14 |
) |
|
|
|
|
|
|
(0.02 |
) |
Translated earnings contract loss (3) |
|
|
|
|
|
|
8 |
|
|
|
6 |
|
|
|
|
|
|
|
0.01 |
|
Acquisition-related costs (4) |
|
|
|
|
|
|
34 |
|
|
|
20 |
|
|
|
|
|
|
|
0.02 |
|
Discrete tax items and other tax-related adjustments (5) |
|
|
|
|
|
|
|
|
|
|
(2 |
) |
|
|
|
|
|
|
(0.00 |
) |
Restructuring, impairment and other charges and credits (6) |
|
|
|
|
|
|
66 |
|
|
|
53 |
|
|
|
|
|
|
|
0.06 |
|
Pension mark-to-market adjustment (8) |
|
|
|
|
|
|
10 |
|
|
|
8 |
|
|
|
|
|
|
|
0.01 |
|
Loss on investments (9) |
|
|
|
|
|
|
4 |
|
|
|
4 |
|
|
|
|
|
|
|
0.00 |
|
Gain on sale of assets (10) |
|
|
|
|
|
|
(20 |
) |
|
|
(15 |
) |
|
|
|
|
|
|
(0.02 |
) |
Core performance measures |
|
$ |
3,367 |
|
|
$ |
461 |
|
|
$ |
350 |
|
|
|
19.4 |
% |
|
$ |
0.41 |
|
(a) |
Based upon statutory tax rates in the specific jurisdiction for each event. |
(b) |
The calculation of the ETR for GAAP and Core excludes net income attributable to NCI of approximately |
See “Items Adjusted from GAAP Measures” for the descriptions of the footnoted reconciling items. |
|
Reconciliation of Non-GAAP Measures |
|
(Unaudited; in millions) |
|
|
|
Three months ended |
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Selling, |
|
|
Research, |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
general |
|
|
development |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
Gross |
|
|
and |
|
|
and |
|
|
|
|
|
|
Operating |
|
||||
|
|
Gross |
|
|
margin |
|
|
administrative |
|
|
engineering |
|
|
Operating |
|
|
margin |
|
||||||
|
|
margin |
|
|
% |
|
|
expenses |
|
|
expenses |
|
|
income |
|
|
% |
|
||||||
As reported - GAAP |
|
$ |
993 |
|
|
|
33.4 |
% |
|
$ |
451 |
|
|
$ |
258 |
|
|
$ |
254 |
|
|
|
8.5 |
% |
Constant-currency adjustment (1) |
|
|
227 |
|
|
|
|
|
|
|
4 |
|
|
|
|
|
|
|
223 |
|
|
|
|
|
Acquisition-related costs (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30 |
|
|
|
|
|
Restructuring, impairment and other charges and credits (6) |
|
|
(20 |
) |
|
|
|
|
|
|
(11 |
) |
|
|
|
|
|
|
(9 |
) |
|
|
|
|
Litigation, regulatory and other legal matters (7) |
|
|
|
|
|
|
|
|
|
|
5 |
|
|
|
|
|
|
|
(5 |
) |
|
|
|
|
Pension mark-to-market adjustment (8) |
|
|
|
|
|
|
|
|
|
|
(8 |
) |
|
|
(3 |
) |
|
|
11 |
|
|
|
|
|
Core performance measures |
|
$ |
1,200 |
|
|
|
36.8 |
% |
|
$ |
441 |
|
|
$ |
255 |
|
|
$ |
504 |
|
|
|
15.5 |
% |
|
|
Three months ended |
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Selling, |
|
|
Research, |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
general |
|
|
development |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
Gross |
|
|
and |
|
|
and |
|
|
|
|
|
|
Operating |
|
||||
|
|
Gross |
|
|
margin |
|
|
administrative |
|
|
engineering |
|
|
Operating |
|
|
margin |
|
||||||
|
|
margin |
|
|
% |
|
|
expenses |
|
|
expenses |
|
|
income |
|
|
% |
|
||||||
As reported - GAAP |
|
$ |
1,003 |
|
|
|
31.6 |
% |
|
$ |
421 |
|
|
$ |
254 |
|
|
$ |
297 |
|
|
|
9.3 |
% |
Constant-currency adjustment (1) |
|
|
149 |
|
|
|
|
|
|
|
2 |
|
|
|
|
|
|
|
147 |
|
|
|
|
|
Acquisition-related costs (4) |
|
|
|
|
|
|
|
|
|
|
1 |
|
|
|
|
|
|
|
30 |
|
|
|
|
|
Restructuring, impairment and other charges and credits (6) |
|
|
54 |
|
|
|
|
|
|
|
(5 |
) |
|
|
|
|
|
|
59 |
|
|
|
|
|
Pension mark-to-market adjustment (8) |
|
|
|
|
|
|
|
|
|
|
(8 |
) |
|
|
(2 |
) |
|
|
10 |
|
|
|
|
|
Gain on sale of assets (10) |
|
|
(20 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(20 |
) |
|
|
|
|
Core performance measures |
|
$ |
1,186 |
|
|
|
35.2 |
% |
|
$ |
411 |
|
|
$ |
252 |
|
|
$ |
523 |
|
|
|
15.5 |
% |
See “Items Adjusted from GAAP Measures” for the descriptions of the footnoted reconciling items. |
||||||||||||||||||||||||
Reconciliation of Non-GAAP Measures |
|
(Unaudited; in millions) |
|
|
Three months ended |
|
|||||
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Cash flows from operating activities |
|
$ |
96 |
|
|
$ |
(49 |
) |
Realized gains on translated earnings contracts and other |
|
|
94 |
|
|
|
81 |
|
Translation losses on cash balances |
|
|
|
|
|
|
(33 |
) |
Adjusted cash flows from operating activities |
|
$ |
190 |
|
|
$ |
(1 |
) |
Less: Capital expenditures |
|
$ |
252 |
|
|
$ |
382 |
|
Adjusted free cash flow |
|
$ |
(62 |
) |
|
$ |
(383 |
) |
Items Adjusted from GAAP Measures |
|
Items adjusted from GAAP measures to arrive at core performance measures are as follows: |
|
(1) |
Constant-currency adjustment: As a significant portion of revenues and expenses are denominated in currencies other than the
The constant-currency rates established for our core performance measures are internally derived long-term management estimates, which are closely aligned with our hedging instrument rates. These hedging instruments may include, but are not limited to, foreign exchange forward or option contracts and foreign-denominated debt. For the three months ended
We believe that the use of constant-currency reporting allows management to understand our results without the volatility of currency fluctuation, analyze underlying trends in the businesses and establish operational goals and forecasts.
Constant-currency rates used are as follows and are applied to all periods presented and to all foreign exchange exposures during the period, even though we may be less than 100% hedged: |
Currency |
|
Japanese yen |
|
Korean won |
|
Chinese yuan |
|
New |
|
Euro |
|
Mexican peso |
Rate |
|
¥107 |
|
₩1,175 |
|
¥6.7 |
|
|
|
€.81 |
|
MX$20 |
(2) |
Translation of Japanese yen-denominated debt: Amount reflects the gain or loss on the translation of our yen-denominated debt to |
(3) |
Translated earnings contract: Amount reflects the impact of the realized and unrealized gains and losses from the Japanese yen, South Korean won, Chinese yuan, euro and New Taiwan dollar-denominated foreign currency hedges related to translated earnings, as well as the unrealized gains and losses of our British pound-denominated foreign currency hedges related to translated earnings. |
(4) |
Acquisition-related costs: Amount reflects intangible amortization, inventory valuation adjustments and external acquisition-related deal costs, as well as other transaction related costs. |
(5) |
Discrete tax items and other tax-related adjustments: Amount reflects certain discrete period tax items such as changes in tax law, the impact of tax audits, changes in tax reserves and changes in deferred tax asset valuation allowances, as well as other tax-related adjustments. |
(6) |
Restructuring, impairment and other charges and credits: Amount reflects certain restructuring, impairment losses and other charges and credits, as well as other expenses, including severance, accelerated depreciation, asset write-offs and facility repairs resulting from power outages, which are not related to ongoing operations. |
(7) |
Litigation, regulatory and other legal matters: Amount reflects developments in commercial litigation, intellectual property disputes, adjustments to our estimated liability for environmental-related items and other legal matters. |
(8) |
Pension mark-to-market adjustment: Amount primarily reflects defined benefit pension mark-to-market gains and losses, which arise from changes in actuarial assumptions and the difference between actual and expected returns on plan assets and discount rates. |
(9) |
Loss on investments: Amount reflects the gain or loss recognized on investments due to mark-to-market adjustments for the change in fair value or the disposition of an investment. |
(10) |
Gain on sale of assets: Amount represents the gain recognized for the sale of assets. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240429418479/en/
Media Relations Contact:
(607) 684-1167
westm4@corning.com
Investor Relations Contact:
(607) 974-6716
nicholsoas@corning.com
Source: