Summary
Corning Inc. (GLW) reported mixed results for the second quarter and first half of 2011, with net sales increasing year-over-year but net income declining. The increase in net sales was driven by strong performance in the Specialty Materials, Telecommunications, and Environmental Technologies segments, notably fueled by demand for Corning® Gorilla® glass. However, a significant decrease in net income was primarily attributed to higher income taxes due to the absence of a favorable tax impact from earnings repatriation in 2010 and expiring tax holidays, as well as a decline in equity earnings from its Display Technologies segment. The company maintained a strong balance sheet with $6.4 billion in cash, cash equivalents, and short-term investments. Despite increased capital expenditures, particularly for expanding manufacturing capacity in China and Japan, Corning generated $1.1 billion in operating cash flow for the first half of the year. Management expects continued sales growth in 2011, though at a slower pace than initially anticipated for the LCD glass market, and remains focused on innovation and financial stability.
Financial Highlights
51 data points| Revenue | $2.00B |
| Cost of Revenue | $1.12B |
| Gross Profit | $889.00M |
| SG&A Expenses | $284.00M |
| Operating Income | $424.00M |
| Net Income | $755.00M |
| EPS (Basic) | $0.48 |
| EPS (Diluted) | $0.47 |
| Shares Outstanding (Basic) | 2K |
| Shares Outstanding (Diluted) | 2K |
Key Highlights
- 1Net sales increased by 17% to $2.0 billion for Q2 2011 and by 20% to $3.9 billion for the first six months of 2011, year-over-year.
- 2Net income attributable to Corning Incorporated decreased by 17% to $755 million for Q2 2011 and by 13% to $1.5 billion for the first six months of 2011.
- 3The Specialty Materials segment, driven by Corning® Gorilla® glass, saw a significant sales increase of 125% in Q2 and 142% in the first half of 2011.
- 4Telecommunications and Environmental Technologies segments also experienced substantial sales growth, up 24% and 40% respectively for Q2 2011.
- 5Display Technologies segment sales decreased by 9% in Q2 2011 and 4% in the first half, primarily due to price declines and lower volumes.
- 6The effective income tax rate increased significantly from 3.3% to 14.0% for Q2 2011, impacting profitability.
- 7Corning generated $1.1 billion in net cash from operating activities for the first six months of 2011, while capital expenditures increased significantly to $1.0 billion for the same period.