UPDATE: Corning 2Q Profit Up 49%,But Provides Muted Forecast
28 Julho 2010 - 12:50PM
Dow Jones News
Corning Inc. (GLW) posted a 49% jump in second-quarter profit,
but offered a conservative forecast for glass displays used in
liquid-crystal-display televisions.
Corning said it expects glass volume in the third quarter to be
flat sequentially, contrasting with the company's bullish tone and
strong second-quarter performance.
"With most tech companies delivering much-better-than-expected
third-quarter outlooks, Corning's volume growth expectation for LCD
is disappointing," said Brian White, an analyst at Ticonderoga
Securities.
The maker of glass used in LCD screens on TVs, computer
monitors, and other electronics has enjoyed soaring profit as
demand has risen this year. Jim Flaws, chief financial officer of
Corning, said he believes glass sales "will be fine" heading into
the fourth quarter, and doesn't see demand stopping.
Corning posted a profit of $913 million, or 58 cents a share, up
from $611 million, or 39 cents a share, a year earlier. Sales
jumped 23% to $1.71 billion.
Analysts were expecting profit of 52 cents on $1.65 billion in
revenue, according to a poll by Thomson Reuters.
Gross margin jumped to 48.3% from 41.2%.
The company has positioned its scratch-resistant Gorilla Glass,
used in smartphone and tablet computer screens, as the next growth
driver.
"We're expecting to see good growth again for Gorilla and for
LCDs next year," Flaws told analysts during a conference call
Wednesday.
Gorilla Glass is on pace to generate sales of $250 million this
year, and the company expects it to be a billion-dollar business by
next year. It plans to invest about $800 million building a
production facility in Beijing.
But LCD television screens remain the biggest driver of
Corning's Display Technologies unit, which saw sales jump 24%. The
fiber optics-focused telecommunications segment notched a 0.9%
sales increase as divestitures weighed on results.
-By Roger Cheng, Dow Jones Newswires; 212-416-2153;
roger.cheng@dowjones.com
(Matt Jarzemsky contributed to this report.)
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