Summary
Corning Inc. reported strong revenue growth for the second quarter and first half of 2018, driven primarily by its Optical Communications and Environmental Technologies segments. Net sales increased by 10% in the second quarter to $2.75 billion and by 8% in the first half to $5.25 billion compared to the prior year. The company saw significant contributions from the acquisition of 3M's Communications Market Division, which bolstered the Optical Communications segment. Despite overall revenue growth, net income saw a substantial year-over-year decrease of 72% in the first half of 2018, largely impacted by a $172 million charge related to an IRS audit settlement and other legal and tax-related items. However, the second quarter showed a robust 68% increase in net income to $738 million, benefiting from a significant gain on translated earnings contracts and favorable tax adjustments. Management anticipates continued revenue growth for the full year, with increased outlooks for several segments, underscoring confidence in its strategy and investment in core technologies.
Financial Highlights
50 data points| Revenue | $2.75B |
| Cost of Revenue | $1.68B |
| Gross Profit | $1.07B |
| SG&A Expenses | $412.00M |
| Operating Income | $395.00M |
| Net Income | $738.00M |
| EPS (Basic) | $0.87 |
| EPS (Diluted) | $0.78 |
| Shares Outstanding (Basic) | 819.00M |
| Shares Outstanding (Diluted) | 943.00M |
Key Highlights
- 1Net sales increased by 10% year-over-year in Q2 2018 to $2.75 billion, and by 8% for the first half of 2018 to $5.25 billion, driven by strong performance in Optical Communications and Environmental Technologies.
- 2Acquisition of 3M's Communications Market Division in June 2018 significantly contributed to the Optical Communications segment, adding $794 million in assets and $242 million in goodwill.
- 3Net income saw a sharp decrease of 72% in the first six months of 2018 to $149 million, primarily due to a $172 million charge for an IRS audit settlement and other legal costs.
- 4Q2 2018 net income significantly improved by 68% to $738 million, boosted by a $267 million increase in translated earnings contracts gains and positive tax adjustments.
- 5The company raised its full-year 2018 segment net sales outlook to approximately $11.3 billion, reflecting optimism across various business segments.
- 6Corning repurchased $1.49 billion of common stock in the first half of 2018 as part of its ongoing share repurchase program.
- 7Capital expenditures increased significantly to $1.18 billion in the first half of 2018, driven by capacity expansions in Display Technologies, Optical Communications, and Environmental Technologies.