Summary
Corning Incorporated (GLW) for the fiscal year ended December 30, 2018, reported a significant rebound in profitability, generating $1.1 billion in net income compared to a net loss of $0.5 billion in the prior year. This turnaround was largely attributed to the absence of substantial tax reform adjustments from 2017 and increased segment net income across several divisions, notably Optical Communications and Environmental Technologies. Revenue also saw a robust 12% increase to $11.3 billion, driven by strong performance in Optical Communications, Environmental Technologies, and Specialty Materials segments. The company continues to execute its Strategy and Capital Allocation Framework, emphasizing sustained investment in R&D and core technologies. A notable strategic move was the acquisition of 3M's Communication Markets Division, which bolstered the Optical Communications segment. Looking ahead, Corning anticipates continued growth across its segments, with specific focus on expanding Gen 10.5 manufacturing capacity for display glass and leveraging innovations in Gorilla Glass for automotive applications.
Financial Highlights
52 data points| Revenue | $11.29B |
| Cost of Revenue | $6.83B |
| Gross Profit | $4.46B |
| R&D Expenses | $807.00M |
| SG&A Expenses | $1.80B |
| Operating Income | $1.57B |
| Net Income | $1.07B |
| EPS (Basic) | $1.19 |
| EPS (Diluted) | $1.13 |
| Shares Outstanding (Basic) | 816.00M |
| Shares Outstanding (Diluted) | 941.00M |
Key Highlights
- 1Net income improved significantly to $1.1 billion in 2018 from a net loss of $0.5 billion in 2017, driven by the absence of 2017 tax reform charges and growth in key segments.
- 2Total net sales increased by 12% to $11.3 billion in 2018, with the Optical Communications segment being the largest contributor at 37% of total sales, up 18% year-over-year.
- 3The company acquired 3M's Communication Markets Division for $841 million, enhancing its Optical Communications segment's market access and product portfolio.
- 4Corning continues to invest heavily in research, development, and engineering, with these expenses increasing by 15% to $993 million in 2018, reflecting a commitment to innovation.
- 5Shareholder returns were prioritized, with $11.8 billion distributed through share repurchases and dividends since the introduction of the Capital Allocation Framework, including an 11.1% increase in the quarterly dividend in 2019.
- 6The Display Technologies segment, while facing pricing pressures, saw volume growth and a more favorable pricing environment in 2018, with expectations for continued improvement in price declines.
- 7Corning forecasts continued sales growth across most segments in 2019, with particular strength expected in Optical Communications and Environmental Technologies.