Summary
Corning Incorporated's (GLW) 2015 10-K filing highlights a year of mixed results, with net sales decreasing by 6% to $9.11 billion, primarily due to significant declines in the Display Technologies segment. This segment's performance was impacted by a 20% drop in sales, driven by yen depreciation and price declines, although volume saw a mid-single-digit increase. Conversely, the Optical Communications segment demonstrated strong growth, with sales up 12% driven by increased demand for carrier and enterprise network products and strategic acquisitions. Net income saw a substantial decrease to $1.34 billion from $2.47 billion in the prior year, largely attributable to foreign currency hedge impacts, lower earnings in the Display Technologies segment, and increased pension plan costs. The company also announced a new strategy focused on concentrating R&D and capital spending on core technologies and platforms, alongside a commitment to return over $10 billion to shareholders through share repurchases and dividends by 2019. Significant events include the planned exchange of its Dow Corning interest for cash and Hemlock Semiconductor ownership, and investments in new glass manufacturing facilities, particularly for Gen 10.5 LCD substrates in China.
Financial Highlights
52 data points| Revenue | $9.11B |
| Cost of Revenue | $5.46B |
| Gross Profit | $3.65B |
| R&D Expenses | $638.00M |
| SG&A Expenses | $1.51B |
| Operating Income | $1.32B |
| Net Income | $1.34B |
| EPS (Basic) | $1.02 |
| EPS (Diluted) | $1.00 |
| Shares Outstanding (Basic) | 1.22B |
| Shares Outstanding (Diluted) | 1.34B |
Key Highlights
- 1Net sales declined 6% year-over-year to $9.11 billion, impacted by foreign currency headwinds and price pressures, particularly in Display Technologies.
- 2The Display Technologies segment experienced a 20% sales decrease, primarily due to yen depreciation ($446 million impact) and low-teen percentage price declines, partially offset by mid-single-digit volume growth.
- 3Optical Communications segment sales grew 12% to $2.98 billion, driven by strong performance in carrier and enterprise network products and the impact of acquisitions.
- 4Net income attributable to Corning fell significantly to $1.34 billion ($1.00/share) in 2015 from $2.47 billion ($1.73/share) in 2014, impacted by foreign currency hedges, lower Display Tech earnings, and pension expenses.
- 5Corning announced a new strategy to focus 80% of R&D and capital spending on core technologies and platforms over the next four years, aiming to return over $10 billion to shareholders by 2019.
- 6The company plans to exchange its 50% interest in Dow Corning for 100% of a new entity holding approximately 40% of Hemlock Semiconductor and $4.8 billion in cash, expected to close in H1 2016.
- 7Significant investments were made in Display Technologies, including plans for a Gen 10.5 glass manufacturing facility in Hefei, China, supporting large-size TV panel production.