CORNING INC NY
For the period ended Jun 30, 2024. Filed Aug 2, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 2, 2024
GLW$106.13+2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-02.
0001437749-24-014319
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-02.
0001437749-24-024494
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 148 previous paragraphs and 159 current paragraphs.
95 unchanged; 36 reworded; 23 added; 15 removed; 2 previous and 5 current paragraphs rearranged.
Tables are not compared: 44 previous and 49 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
Corning is vital to progress. We are the world leaders in glass science, ceramic science and optical physics – along with four proprietary manufacturing and engineering platforms – and we apply our capabilities to invent and make category-defining, highly engineered products; drive profitable and durable growth; and create long-term value. Today, our markets include optical communications, mobile consumer electronics, display, automotive, solar, semiconductor and life sciences.
Current report
The Company has outlined a plan called “Springboard,” – to add more than $3 billion in annualized core sales with strong incremental profit and cash flow in the next three years as cyclical factors and secular trends converge.
Current report
Core Components of Springboard:
Current report
Corning expects a number of upward cyclical factors and secular trends to drive growth across our Market-Access Platforms. In Optical Communications, generative artificial intelligence is expected to create a significant amount of growth; additionally, our carrier customers are reaching the end of their inventory drawdowns and beginning to order closer to their current deployment levels; and government efforts to bring high-speed internet to rural communities through the Broadband Equity Access and Deployment program will contribute to growth beginning in 2025 and add significant sales over the next several years. In Display, we expect to capitalize on the trend of larger screens, with about 1 inch of screen-size growth per year to add low-to-mid-single-digit volume growth. In Automotive, we have a triple-digit automotive glass business today, and we expect sales in that business to almost triple by 2026; additionally, recently announced U.S. EPA regulations will require the adoption of gasoline particulate filters in the U.S. starting with model-year 2027 – this adoption offers hundreds of millions of dollars of growth for us in the U.S. alone, even in the face of BEV adoption, and we expect sales to start in 2026. Finally, we expect to leverage the Inflation Reduction Act to support the build out of a U.S. solar supply chain.
Current report
Overall, Corning is energized by the tremendous opportunity for value creation we have built for our shareholders.
Current report
For the three months ended June 30, 2024, net sales were up slightly when compared to the same period in 2023. This was primarily driven by increases in specialty glass product sales of $77 million and telecommunication product sales of $47 million, offset by decreases in polycrystalline silicon product sales of $59 million, environmental substrate and filter product sales of $29 million and display product sales of $21 million.
Current report
For the three months ended June 30, 2024, gross margin decreased $64 million, or 6%, and decreased as a percentage of sales by 2 percentage points when compared to the same period in 2023. This is primarily driven by a $62 million increase in restructuring and asset write-off charges, as discussed in Note 2 (Restructuring, Impairment and Other Charges and Credits) in the accompanying notes to the consolidated financial statements.
Current report
For the six months ended June 30, 2024, gross margin decreased $74 million, or 4%, and remained consistent as a percentage of sales when compared to the same period in 2023.
Current report
Translated earnings contract gain, net
Current report
For the three and six months ended June 30, 2024, the effective tax rate differed from the United States (“U.S.”) statutory rate of 21%, primarily due to certain pre-tax losses with no corresponding expected tax benefit. These losses were mostly driven by asset write-offs associated with the closure of a display manufacturing plant. Refer to Note 2 (Restructuring, Impairment and Other Charges and Credits) in the accompanying notes to the consolidated financial statements for additional information.
Current report
The effective tax rate for the three and six months ended June 30, 2024 increased when compared to the same periods in 2023 primarily due to certain pre-tax losses during the three and six months ended June 30, 2024 with no corresponding expected tax benefit and a reduction in the net benefit due to foreign derived intangible income.
Current report
The decrease in segment net sales for both the three and six month periods was primarily due to a decline in heavy-duty diesel, reflecting the impact of the Class 8 truck downcycle in North America.
Current report
The increase in segment net sales for the three month period was primarily due to increased demand as customers are completing their inventory drawdowns. Segment net sales for the six month period was relatively flat with the prior year.
Current report
The increase in segment net income for both the three and six month periods was primarily driven by the increase in sales, as outlined above.
Current report
The increase in segment net income for both the three and six month periods was primarily driven by the increase in sales, as outlined above, and manufacturing improvements.
Current report
The decrease in segment net income for the three month period was primarily driven by the decrease in sales, as outlined above. The increase in segment net income for the six month period was primarily driven by improved operating performance.
Current report
For the three months ended June 30, 2024, we generated core net sales of $3.6 billion compared to core net sales of $3.5 billion for the same period in 2023. The increase in core net sales of $122 million was primarily driven by increased segment sales of $86 million in Display, $78 million in Specialty Materials and $47 million in Optical Communications, partially offset by decreased segment sales of $81 million in Hemlock and Emerging Growth Businesses. Net sales by reportable segment and Hemlock and Emerging Growth Businesses are discussed in detail in the “Segment Analysis” section of our MD&A.
Current report
For the three months ended June 30, 2024, we generated core net income of $407 million compared to core net income generated of $388 million for the same period in 2023. The increase of $19 million was primarily due to higher segment net income of $50 million in Display and $30 million in Specialty Materials, partially offset by lower segment net income of $49 million in Hemlock and Emerging Growth Businesses. Net income by reportable segment and Hemlock and Emerging Growth Businesses are discussed in detail in the “Segment Analysis” section of our MD&A.
Current report
On May 15, 2023, the Company issued €300 million 3.875% Notes due 2026 (“2026 Notes”) and €550 million 4.125% Notes due 2031 (“2031 Notes”). The proceeds from the 2026 Notes and 2031 Notes were received in euros and converted to U.S. dollars on the date of issuance. The net proceeds received were approximately $918 million and will be used for general corporate purposes. As of June 30, 2024, the U.S. dollar equivalent carrying value of the euro-denominated long-term debt was $903 million.
Current report
Share Repurchase Agreement
Current report
Pursuant to the Share Repurchase Agreement (“SRA”) with Samsung Display Co., Ltd. (“SDC”), SDC has the option to offer to sell 22 million common shares to Corning in specified tranches from time to time in calendar years 2024 through 2027. Corning may, at its sole discretion, elect to repurchase such common shares. If Corning elects not to repurchase the common shares and SDC sells the common shares on the open market, Corning will be required to pay SDC a make-whole payment, subject to a 5% cap of the repurchase proceeds that otherwise would have been paid by Corning. As of June 30, 2024 and December 31, 2023, the fair value of the liability associated with this option was not material.
Current report
During the three and six months ended June 30, 2024, the Company repurchased 3 million common shares for $105.4 million, pursuant to the terms of the SRA, as discussed above. No shares were repurchased under our 2019 Authorization during the three and six months ended June 30, 2023.
Current report
In conjunction with the Facility Lease, Corning entered into an equipment lease (“Equipment Lease”) on June 17, 2024, with an estimated purchase and installation cost of $365 million, for the equipment to be installed and operated within the Facility. The Company is the procurement and installation agent on behalf of the lessor.
Removed paragraphs (15)
Previous report
Corning is vital to progress – in the industries we help advance and in the world we share. For more than 170 years, Corning has combined its unparalleled expertise in glass science, ceramic science and optical physics with deep manufacturing and engineering capabilities to develop category-defining products that transform industries and enhance people’s lives. Our materials science and manufacturing expertise, boundless curiosity and commitment to purposeful invention place us at the center of the way the world works, learns and lives. In addition, our sustained investment in research, development and engineering capabilities means we are always ready to solve the toughest challenges – alongside our customers.
Previous report
Our capabilities are versatile and synergistic, allowing Corning to evolve to meet changing market needs, while also helping customers capture new opportunities in dynamic industries. Corning strives to be a catalyst for positive change and to help move the world forward. The Company drives profitable multiyear growth by inventing, making and selling life-changing products – all of which is based on a set of vital capabilities that are increasingly relevant to profound transformations that touch many facets of daily life. Today, Corning's markets include optical communications, mobile consumer electronics, display, automotive, solar, semiconductor and life sciences.
Previous report
In 2023, we introduced plans to improve profitability and cash flow and we took action to increase price and improve productivity ratios. Since then, our results demonstrated that we made solid progress advancing market leadership, strengthening our profitability and improving our cash flow generation even in the lower-demand environment. Further, we entered 2024 operationally strong and our first-quarter results show encouraging signs of improving market conditions.
Previous report
We remain confident that key industry growth drivers are intact: specifically, wireless, broadband, 5G, cloud computing and advanced artificial intelligence in Optical Communications, increased screen sizes in Display Technologies, tighter emission regulations that drive more and better filtration in Environmental Technologies and the need for advanced cover materials in Mobile Consumer Electronics. Additionally, we have built competitively-advantaged positions in the markets in which we participate and we believe we are the technology leader in these markets. We believe we are well-positioned with existing production capacity and technical capabilities necessary to capture this growth and deliver strong incremental profit and cash to our shareholders.
Previous report
Refer to the “Segment Analysis” section of our MD&A below for a discussion of net sales by segment.
Previous report
For the three months ended March 31, 2024, gross margin decreased $10 million, or 1%, and improved as a percentage of sales by 1 percentage point when compared to the same period in 2023. Despite the decline in sales, the improvement in gross margin as a percentage of sales is primarily driven by the actions taken throughout 2023 to improve profitability, including raising prices, restoring our productivity levels and normalizing inventory levels.
Previous report
Translated earnings contract gain (loss), net
Previous report
The effective tax rate for the three months ended March 31, 2024 increased when compared to the same period in 2023 primarily due to differences arising from foreign earnings and changes in tax reserves.
Previous report
The increase in segment net sales was primarily due to increased gasoline particulate filter adoption in China, partially offset by a decline in heavy-duty diesel.
Previous report
The decrease in segment net sales was primarily due to customers in North America and Europe continuing their inventory drawdowns.
Previous report
The increase in segment net income was primarily driven by the increase in sales volume, as outlined above, and improved profitability from pricing actions taken.
Previous report
The increase in segment net income was primarily driven by the increase in sales, as outlined above, and improved operating performance.
Previous report
Fixed Rate Cumulative Convertible Preferred Stock, Series A
Previous report
We had 2,300 outstanding shares of Fixed Rate Cumulative Convertible Preferred Stock, Series A (the “Preferred Stock”) as of December 31, 2020. On January 16, 2021, the Preferred Stock became convertible into 115 million common shares. On April 5, 2021 we executed the Share Repurchase Agreement (“SRA”) with Samsung Display Co., Ltd. (“SDC”) and the Preferred Stock was fully converted as of April 8, 2021. Immediately following the conversion, we repurchased and retired 35 million of the common shares held by SDC for an aggregate purchase price of approximately $1.5 billion, of which approximately $507 million was paid in April in each of 2023, 2022 and 2021.
Previous report
Pursuant to the SRA, with respect to the remaining 80 million common shares outstanding held by SDC:
Reworded paragraphs (36)
Previous wording
We expect core net sales of approximately $3.4 billion for the second quarter of 2024.
Current wording
We expect core net sales of approximately $3.7 billion for the third quarter of 2024.
Previous wording
For the three months ended March 31, 2024, net sales decreased $203 million, or 6%, when compared to the same period in 2023. The decrease was primarily driven by decreased segment sales of $195 million in Optical Communications.
Current wording
For the six months ended June 30, 2024, net sales decreased $195 million, or 3%, when compared to the same period in 2023. This was primarily driven by decreases in telecommunication product sales of $148 and polycrystalline silicon product sales of $120 million, partially offset by increases in specialty glass product sales of $123 million.
Previous wording
For the three months ended March 31, 2024, selling, general and administrative expenses increased $30 million and increased as a percentage of sales when compared to the same period in 2023 due to lower sales in the current period as compared to the same period in 2023.
Current wording
For the three months ended June 30, 2024, selling, general and administrative expenses increased $31 million, or 7%, and remained consistent as a percentage of sales when compared to the same period in 2023. For the six months ended June 30, 2024, selling, general and administrative expense increased $61 million, or 7%, and increased as a percentage of sales due to the lower sales in the current period as compared to the same period in 2023.
Previous wording
For the three months ended March 31, 2024, research, development and engineering expenses increased $4 million and increased as a percentage of sales when compared to the same period in 2023 due to lower sales in the current period as compared to the same period in 2023.
Current wording
For the three and six months ended June 30, 2024, research, development and engineering expenses remained relatively flat and consistent as a percentage of sales when compared to the same periods in 2023.
Previous wording
Included in translated earnings contract gain (loss), net, is the impact of foreign currency contracts which economically hedge the translation exposure arising from movements in the Japanese yen, South Korean won, new Taiwan dollar, euro and Chinese yuan and its impact on net income.
Current wording
Included in translated earnings contract gain, net, is the impact of foreign currency contracts which economically hedge the translation exposure arising from movements in the Japanese yen, South Korean won, new Taiwan dollar, euro, Chinese yuan and Mexican peso and its impact on net income.
Previous wording
The following table provides detailed information on the impact of translated earnings contract gain (loss), net (in millions):
Current wording
The following table provides detailed information on the impact of translated earnings contract gain, net (in millions):
Previous wording
For the three months ended March 31, 2024, income before income taxes increased $68 million when compared to the same period in 2023, which is primarily driven by a $47 million improvement in translated earnings contract gains.
Current wording
For the three and six months ended June 30, 2024, income before income taxes decreased $237 million and $169 million, respectively, when compared to the same periods in 2023, which is primarily driven by less gains on our translated earnings contracts and a decline in our gross margin, as discussed above, when compared to the same periods in 2023.
Previous wording
For the three months ended March 31, 2023, the effective tax rate differed from the U.S. statutory rate of 21%, primarily due to differences arising from foreign earnings and a net benefit due to foreign derived intangible income.
Current wording
For the three and six months ended June 30, 2023, the effective tax rate differed from the U.S. statutory rate of 21%, primarily due to changes in valuation allowance assessments, partially offset by differences arising from foreign earnings, adjustments to share-based compensation, and a net benefit due to foreign derived intangible income.
Previous wording
Comprehensive loss attributable to Corning Incorporated for the three months ended March 31, 2024 was $118 million compared to comprehensive income of $109 million for the three months ended March 31, 2023. This movement is driven by the increase in net losses on foreign currency translation adjustments of $246 million, primarily driven by the Japanese yen, Chinese yuan and euro.
Current wording
Comprehensive loss attributable to Corning Incorporated for the six months ended June 30, 2024 was $231 million compared to comprehensive income of $88 million for the three months ended June 30, 2023. This movement is driven by the increase in net losses on foreign currency translation adjustments of $150 million, primarily driven by losses in the Japanese yen, euro and Korean won, partially offset by gains in the Chinese yuan.
Previous wording
The decrease in segment net sales was primarily driven by a decline in sales volume due to lower carrier demand as carrier customers continue to draw down inventory.
Current wording
The increase in segment net sales for the three month period was primarily driven by an increase in sales volume due to higher demand driven by AI-related connectivity solutions, partially offset by lower carrier demand as customers continue to draw down their inventory. The decrease in segment net sales for the six month period was primarily driven by the decline in sales volume due to lower carrier demand as customers continued to drawdown their inventory, partially offset by the increase in sales driven by AI-related connectivity solutions.
Previous wording
The increase in segment net sales was primarily due to higher sales volume, attributable to increased panel maker utilization driven by growth in retail demand, as well as pricing actions taken in the second half of 2023.
Current wording
The increase in segment net sales for both the three and six month periods was due to higher sales volume, attributable to increased panel maker utilization driven by growth in retail demand, as well as pricing actions taken in the second half of 2023.
Previous wording
The increase in segment net sales was due to continued strong demand for premium smartphone cover materials as well as semiconductor-related products.
Current wording
The increase in segment net sales for both the three and six month periods was due to continued strong demand for premium glass for mobile devices as well as semiconductor-related products.
Previous wording
The decrease in segment net sales was primarily due to a decrease in our HSG business driven by lower pricing for solar-grade polysilicon and lower sales in our Pharmaceutical Technologies business from the completion of volume commitments for COVID-related products.
Current wording
The decrease in segment net sales for both the three and six month periods was primarily due to a decrease in our HSG business driven by lower pricing for solar-grade polysilicon and lower sales in our Pharmaceutical Technologies business due to the completion of volume commitments for COVID-related products.
Previous wording
The decrease in segment net income was primarily driven by a decline in sales volume, as outlined above.
Current wording
The increase in segment net income for the three month period was primarily driven by the increase in sales volume, as outlined above. The decrease in segment net income for the six month period was primarily driven by a decline in sales volume, as outlined above.
Previous wording
The increase in segment net income was primarily driven by profitability improvements from productivity actions taken.
Current wording
The increase in segment net income for the three month period was primarily driven by the increase in sales, as outlined above. The increase in segment net income for the six month period was primarily driven by profitability improvements from productivity actions taken.
Previous wording
The decrease in segment net income was primarily driven by our HSG and Pharmaceutical Technologies business due to lower sales, as outlined above.
Current wording
The decrease in segment net income was primarily driven by our HSG and Pharmaceutical Technologies businesses due to lower sales, as outlined above.
Previous wording
In addition, because a significant portion of our revenues and expenses are denominated in currencies other than the U.S. dollar, management believes it is important to understand the impact on sales and net income of translating these currencies into U.S. dollars. Therefore, management utilizes constant-currency reporting for the Display Technologies, Specialty Materials, Environmental Technologies and Life Sciences segments to exclude the impact from the Japanese yen, South Korean won, Chinese yuan, New Taiwan dollar and euro, as applicable to the segment. In addition, effective January 1, 2024, the Company began utilizing constant-currency reporting for the Optical Communications segment to exclude the impact from the Mexican peso on segment results. Prior periods were not recasted as the impact was not material. The most significant constant-currency adjustment relates to the Japanese yen exposure within the Display Technologies segment.
Current wording
In addition, because a significant portion of our revenues and expenses are denominated in currencies other than the U.S. dollar, management believes it is important to understand the impact on sales and net income of translating these currencies into U.S. dollars. Therefore, management utilizes constant-currency reporting for the Display Technologies, Specialty Materials, Environmental Technologies and Life Sciences segments to exclude the impact from the Japanese yen, South Korean won, Chinese yuan, New Taiwan dollar and euro, as applicable to the segment. In addition, effective January 1, 2024, the Company began utilizing constant-currency reporting for the Optical Communications segment to exclude the impact from the Mexican peso on segment results. Prior periods were not recast as the impact was not material. The most significant constant-currency adjustment relates to the Japanese yen exposure within the Display Technologies segment.
Previous wording
For the three months ended March 31, 2024, we generated core net sales of $3.3 billion compared to core net sales of $3.4 billion for the same period in 2023. The decrease in core net sales of $0.1 billion was primarily driven by decreased segment sales of $195 million in Optical Communications and $75 million in Hemlock and Emerging Growth Businesses, partially offset by increased segment sales of $109 million in Display and $48 million in Specialty Materials. Net sales by reportable segment and Hemlock and Emerging Growth Businesses are discussed in detail in the “Segment Analysis” section of our MD&A.
Current wording
For the six months ended June 30, 2024, we generated core net sales of $6.9 billion compared to core net sales of $6.8 billion for the same period in 2023. The increase in core net sales of $13 million was primarily driven by increased segment sales of $195 million in Display and $126 million in Specialty Materials, offset by decreased segment sales of $156 million in Hemlock and Emerging Growth Businesses and $148 million in Optical Communications. Net sales by reportable segment and Hemlock and Emerging Growth Businesses are discussed in detail in the “Segment Analysis” section of our MD&A.
Previous wording
For the three months ended March 31, 2024, we generated core net income of $330 million compared to core net income generated for the three months ended March 31, 2023 of $350 million. The decrease of $20 million was primarily due to lower segment net income for Optical Communications of $59 million, partially offset by higher segment net income for Display Technologies of $41 million. Net income by reportable segment and Hemlock and Emerging Growth Businesses are discussed in detail in the “Segment Analysis” section of our MD&A.
Current wording
For the six months ended June 30, 2024, we generated core net income of $737 million compared to core net income of $738 million for the same period in 2023. The decrease of $1 million was primarily due to lower segment net income of $56 million in Optical Communications and $75 million in Hemlock and Emerging Growth Businesses, offset by higher segment net income of $91 million in Display Technologies and $35 million in Specialty Materials. Net income by reportable segment and Hemlock and Emerging Growth Businesses are discussed in detail in the “Segment Analysis” section of our MD&A.
Previous wording
Core earnings per share decreased for the three months ended March 31, 2024 to $0.38 per share, primarily as a result of the changes in core net income, outlined above.
Current wording
Core earnings per share increased for the three months ended June 30, 2024 to $0.47 per share, primarily as a result of the changes in core net income, outlined above.
Previous wording
We participate in accounts receivable management programs, including factoring arrangements to sell certain accounts receivable to third-party financial institutions or accelerate collections through our customer’s supply chain financing arrangements. Sales of accounts receivable are reflected as a reduction of accounts receivable in the consolidated balance sheets and the proceeds are included in cash flows from operating activities in the consolidated statements of cash flows. By utilizing these types of programs, we have accelerated the collection of $380 million of accounts receivable during the three months ended March 31, 2024. We believe these accounts receivables would have been collected during the normal course of business in the following quarter.
Current wording
We participate in accounts receivable management programs, including factoring arrangements to sell certain accounts receivable to third-party financial institutions or accelerate collections through our customer’s supply chain financing arrangements. Sales of accounts receivable are reflected as a reduction of accounts receivable in the consolidated balance sheets and the proceeds are included in cash flows from operating activities in the consolidated statements of cash flows. By utilizing these types of programs, we have accelerated the collection of $380 million and $389 million of accounts receivable during the three months ended March 31, 2024 and June 30, 2024, respectively. We believe these accounts receivables would have been collected during the normal course of business in the following quarter.
Previous wording
Net cash provided by (used in) operating activities for the three months ended March 31, 2024 increased $145 million when compared to the same period in the prior year primarily driven by improvements in working capital.
Current wording
Net cash provided by operating activities for the six months ended June 30, 2024 increased $47 million when compared to the same period in the prior year primarily driven by improvements in working capital.
Previous wording
Net cash used in investing activities for the three months ended March 31, 2024 improved by $44 million when compared to the same period last year, primarily driven by lower capital expenditures of $130 million and higher realized gains on translated earnings contracts of $13 million, partially offset by $67 million in proceeds from the sale of equipment in the prior period.
Current wording
Net cash used in investing activities for the six months ended June 30, 2024 improved by $177 million when compared to the same period last year, primarily driven by lower capital expenditures of $276 million, partially offset by $67 million in proceeds from the sale of equipment in the prior period.
Previous wording
Net cash used in financing activities for the three months ended March 31, 2024 increased by $60 million when compared to the same period last year, primarily driven by the $54 million in proceeds received in the prior year from other financing arrangements.
Current wording
Net cash used in financing activities for the six months ended June 30, 2024 increased by $448 million when compared to the same period last year, primarily driven by the $918 million in proceeds from the issuance of euro-denominated notes in 2023, partially offset by $507 million in payments for the redemption of preferred stock in 2023. Additionally, we repurchased 3 million common shares for $105 million in 2024 compared to no share repurchases made in the same period last year.
Previous wording
As of March 31, 2024, we had $1.4 billion of cash and cash equivalents. Our cash and cash equivalents are held in various locations throughout the world and are generally unrestricted. We utilize a variety of strategies to ensure that our worldwide cash is available in the locations in which it is needed. As of March 31, 2024, approximately 62% of the consolidated cash and cash equivalents were held outside the U.S.
Current wording
As of June 30, 2024, we had $1.4 billion of cash and cash equivalents. Our cash and cash equivalents are held in various locations throughout the world and are generally unrestricted. We utilize a variety of strategies to ensure that our worldwide cash is available in the locations in which it is needed. As of June 30, 2024, approximately 48% of the consolidated cash and cash equivalents were held outside the U.S.
Previous wording
Our Revolving Credit Agreement includes affirmative and negative covenants with which we must comply, including a leverage (debt to capital ratio) financial covenant. The required leverage ratio is a maximum of 60%. As of March 31, 2024, our leverage using this measure was approximately 39%. As of March 31, 2024, we were in compliance.
Current wording
Our Revolving Credit Agreement includes affirmative and negative covenants with which we must comply, including a leverage (debt to capital ratio) financial covenant. The required leverage ratio is a maximum of 60%. As of June 30, 2024, our leverage using this measure was approximately 40%. As of June 30, 2024, we were in compliance.
Previous wording
We have access to certain Chinese yuan-denominated unsecured variable rate loan facilities, whose proceeds are used for capital investment and general corporate purposes. As of March 31, 2024, borrowings totaled $255 million and these facilities had variable interest rates ranging from 3.2% to 4.1% and maturities ranging from 2024 to 2032. As of March 31, 2024, Corning had 757 million Chinese yuan of unused capacity, equivalent to approximately $105 million.
Current wording
We have access to certain Chinese yuan-denominated unsecured variable rate loan facilities, whose proceeds are used for capital investment and general corporate purposes. As of June 30, 2024, borrowings totaled $249 million and these facilities had variable interest rates ranging from 2.9% to 4.1% and maturities ranging from 2024 to 2032. As of June 30, 2024, Corning had 1.1 billion Chinese yuan of unused capacity, equivalent to approximately $150 million.
Previous wording
In 2019, the Board authorized the repurchase of up to $5.0 billion of common stock (“2019 Authorization”). As of March 31, 2024, approximately $3.3 billion remains available under our 2019 Authorization, which does not have an expiration date and may be amended or terminated by the Board of Directors at any time without prior notice.
Current wording
In 2019, the Board authorized the repurchase of up to $5.0 billion of common stock (“2019 Authorization”). As of June 30, 2024, approximately $3.2 billion remains available under our 2019 Authorization, which does not have an expiration date and may be amended or terminated by the Board of Directors at any time without prior notice.
Previous wording
On May 2, 2024, Corning’s Board of Directors declared a dividend of $0.28 per share of common stock. The dividend will be payable on June 27, 2024.
Current wording
On June 26, 2024, Corning’s Board of Directors declared a quarterly dividend of $0.28 per share of common stock. The dividend will be payable on September 27, 2024. The Board’s decision to declare and pay future dividends will depend on our income and liquidity position, among other factors. We expect to declare quarterly dividends and fund payments with cash from operations.
Previous wording
Capital expenditures were $0.3 billion for the three months ended March 31, 2024. We expect our 2024 full year capital expenditures to be lower than 2023.
Current wording
Capital expenditures were $0.5 billion for the six months ended June 30, 2024. We expect our 2024 full year capital expenditures to be lower than 2023.
Previous wording
As of March 31, 2024, we had $318 million of long-term debt that is due in less than one year.
Current wording
As of June 30, 2024, we had $376 million of long-term debt that is due in less than one year.
Previous wording
Our global pension plans, including our unfunded and non-qualified plans, were 81% funded as of December 31, 2023. Our largest single pension plan is our U.S. qualified plan, which accounted for 77% of our consolidated defined benefit pension plans’ projected benefit obligation, was 92% funded as of December 31, 2023.
Current wording
Our global pension plans, including our unfunded and non-qualified plans, were 81% funded as of December 31, 2023. Our largest single pension plan is our U.S. qualified plan, which accounted for 77% of our consolidated defined benefit pension plans’ projected benefit obligation, was 92% funded as of December 31, 2023. The funded status of our pension plans is dependent upon multiple factors including actuarial assumptions, interest rates at year-end, prior investment returns and contributions made to the plans.
Previous wording
The funded status of our pension plans is dependent upon multiple factors including actuarial assumptions, interest rates at year-end, prior investment returns and contributions made to the plans. During 2024, the Company anticipates making cash contributions of $11 million to its international pension plans.
Current wording
During 2024, the Company anticipates making cash contributions of $11 million to its international pension plans.
Previous wording
On March 12, 2024, Corning entered into a synthetic lease for a solar manufacturing facility in Hemlock, Michigan (the “Facility”), for which we are the construction agent on behalf of the lessor, with an estimated construction cost of approximately $835 million.
Current wording
On March 12, 2024, Corning entered into a synthetic lease (“Facility Lease”) for a solar manufacturing facility in Hemlock, Michigan (the “Facility”), for which the Company is the construction agent on behalf of the lessor, with an estimated construction cost of approximately $835 million.
Previous wording
The lease will commence upon completion of construction of the Facility, which is expected to be in the later part of 2025, and has a lease term of five years with options to renew the lease or purchase the facility. The lease is expected to be classified as a finance lease and the amount of right-of-use asset and lease liability will be determined and recorded upon lease commencement. The estimated undiscounted lease payments, inclusive of a residual value guarantee, are approximately $1.1 billion, of which $35 million, $103 million, $99 million and $96 million is to be paid in 2025, 2026, 2027 and 2028, respectively, and $780 million is to be paid thereafter. The transaction agreements contain covenants that are consistent with our Revolving Credit Agreement as disclosed in the 2023 Form 10-K.
Current wording
The Facility Lease will commence upon completion of construction of the Facility, which is expected to be in the later part of 2025, and has a lease term of five years with options to renew the lease or purchase the facility. The Facility Lease is expected to be classified as a finance lease and the amount of right-of-use asset and lease liability will be determined and recorded upon lease commencement. The estimated undiscounted lease payments, inclusive of a residual value guarantee, are approximately $1.1 billion, of which $35 million, $103 million, $99 million and $96 million is to be paid in 2025, 2026, 2027 and 2028, respectively, and $780 million is to be paid thereafter.
Previous wording
Other than the above matter, there were no material changes outside the ordinary course of business in the obligations disclosed in the 2023 Form 10-K under the caption “Commitments, Contingencies and Guarantees.”
Current wording
Other than the above matters, there were no material changes outside the ordinary course of business in the obligations disclosed in the 2023 Form 10-K under the caption “Commitments, Contingencies and Guarantees.”
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
Comprehensive loss attributable to Corning Incorporated for the three months ended June 30, 2024 was $113 million compared to comprehensive loss of $21 million for the three months ended June 30, 2023. This movement is driven by the decrease in net losses on foreign currency translation adjustments of $96 million, primarily driven by gains in the Japanese yen and Chinese yuan, partially offset by losses in the Korean won and euro.
Current report — wording carried from elsewhere
Core earnings per share decreased for the six months ended June 30, 2024 to $0.85 per share, primarily as a result of the changes in core net income, outlined above.
Current report — wording carried from elsewhere
See “Items Adjusted from GAAP Measures” for the descriptions of the footnoted reconciling items.
Current report — wording carried from elsewhere
The Equipment Lease will commence upon completion of the equipment installation, which is expected to be in the later part of 2025, and has a lease term of five years with obligations to purchase the equipment at lease maturity. The Equipment Lease is expected to be classified as a finance lease and the amount of right-of-use asset and lease liability will be determined and recorded upon lease commencement. The estimated undiscounted lease payments are approximately $446 million, of which $25 million, $100 million, $95 million and $89 million is to be paid in 2025, 2026, 2027 and 2028, respectively, and $137 million is to be paid thereafter.
Current report — wording carried from elsewhere
The transaction agreements for both the Facility Lease and Equipment Lease contain covenants that are consistent with our Revolving Credit Agreement as disclosed in the 2023 Form 10-K.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
For the three months ended March 31, 2024, the effective tax rate differed from the United States (“U.S.”) statutory rate of 21%, primarily due to changes in tax reserves, partially offset by a net benefit due to foreign derived intangible income.
Previous report — wording carried elsewhere
The increase in segment net income was primarily driven by the increase in sales, as outlined above.