10-QPeriod: Q1 FY2022

CORNING INC /NY Quarterly Report for Q1 Ended Mar 31, 2022

Filed April 29, 2022For Securities:GLW

Summary

Corning Inc. reported solid financial results for the first quarter of 2022, with net sales increasing 12% year-over-year to $3.68 billion. This growth was primarily driven by strong performance in the Optical Communications and Display Technologies segments. Net income, however, saw a slight decrease of 3% to $581 million, impacted by lower translated earnings contract gains compared to the prior year. The company demonstrated resilience and financial health, highlighting continued innovation and effective portfolio management. While facing some headwinds like foreign currency fluctuations and automotive component shortages impacting Environmental Technologies, Corning's core performance measures showed positive trends, with core net income up 16%. The company reiterated its commitment to its growth framework, investing in core technologies and manufacturing platforms to capture high-return opportunities.

Financial Highlights

50 data points
Beta

Revenue

$3.68B

34.9% Gross Margin

Net Income

$581.00M

15.8% Net Margin

EPS (Diluted)

$0.68

Total Assets

$30.26B

Cash & Equivalents

$2.02B

Free Cash Flow

$534.00M

Financial Statements
Beta
Revenue$3.68B
Cost of Revenue$2.40B
Gross Profit$1.28B
SG&A Expenses$434.00M
Operating Income$570.00M
Net Income$581.00M
EPS (Basic)$0.69
EPS (Diluted)$0.68
Shares Outstanding (Basic)843.00M
Shares Outstanding (Diluted)859.00M

Key Highlights

  • 1Net sales increased by 12% to $3.68 billion, driven by strong demand in Optical Communications and Display Technologies.
  • 2Optical Communications segment sales grew 28%, fueled by increased carrier capital spending for 5G and broadband.
  • 3Display Technologies segment sales increased 11% due to volume growth and slightly higher pricing.
  • 4Net income decreased by 3% to $581 million, primarily due to a significant reduction in translated earnings contract gains compared to the prior year.
  • 5Core net sales increased by 15% to $3.74 billion, demonstrating underlying operational strength.
  • 6Core net income increased by 16% to $465 million, reflecting improved operational performance excluding certain non-recurring items.
  • 7The company repurchased approximately $151 million of its common stock during the quarter.

Frequently Asked Questions

The primary drivers of the 12% year-over-year net sales increase were strong performance in the Optical Communications segment, which grew 28% due to increased network operator capital spending, and the Display Technologies segment, which saw an 11% increase driven by volume and pricing.

Net income decreased by 3% to $581 million primarily because of a significant decrease in the 'translated earnings contract gain, net' of $143 million compared to the same period in the prior year. This was partially offset by higher net income from the company's reportable segments and a gain on the sale of a business.

Corning actively uses hedging strategies, including foreign exchange forward contracts and option contracts, to mitigate the impact of currency fluctuations on its translated earnings and net cash flows. The filing notes that while foreign exchange movements adversely impacted consolidated net sales and income, the company's hedging activities are designed to reduce this volatility.

Corning expects core net sales for the second quarter of 2022 to be in the range of approximately $3.7 to $3.9 billion.