CORNING INCORPORATED Corning Incorporated
www.corning.com
News Release
FOR RELEASE - July 27, 2021
Corning Reports Outstanding Second-Quarter 2021 Results,
Expects Continued Growth in Third Quarter
Second-quarter core sales of $3.5 billion grew 35% from Q2 2020 and 17% from Q2 2019
Core EPS grew 112% year over year to $0.53 on higher sales and expanded margins
Free cash flow of $471 million grew $186 million, or 65%, year over year
CORNING, N.Y. - 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.
o 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."
© 2021 Corning Incorporated. All Rights Reserved.
Corning Reports Outstanding Second-Quarter 2021 Results, Expects Continued
Growth in Third Quarter
Page 2
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
© 2021 Corning Incorporated. All Rights Reserved.
Corning Reports Outstanding Second-Quarter 2021 Results, Expects Continued
Growth in Third Quarter
Page 3
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.
© 2021 Corning Incorporated. All Rights Reserved.
Corning Reports Outstanding Second-Quarter 2021 Results, Expects Continued
Growth in Third Quarter
Page 4
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.
© 2021 Corning Incorporated. All Rights Reserved.
Corning Reports Outstanding Second-Quarter 2021 Results, Expects Continued
Growth in Third Quarter
Page 5
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 (Virtual)
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 a 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
© 2021 Corning Incorporated. All Rights Reserved.
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Corning Inc. published this content on 27 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 July 2021 11:39:05 UTC.
