GLW Corning Inc

Corning Inc. (GLW) lowered its estimates for third-quarter glass volume, saying panel makers are pulling back production to deal with excess inventory.

Despite the warning, Corning shares continued their recent rebound Tuesday, rising 5.3% to $17.70 as investors were relieved the guidance cut wasn't worse following recent commentary about LCD demand. Shares have climbed 13% in September, rising for two straight sessions, but they still are off 8.3% this year.

Corning is one of the leading providers of glass used in LCD screens on TVs, computer monitors and other electronics. While the company benefited from strong demand earlier this year, concerns have emerged that demand is weakening. Those worries were reflected by Corning's comments Tuesday and led some market watchers to question whether demand could weaken further.

Ticonderoga Securities analyst Brian White said Tuesday's revision, coming only six weeks after Corning's initial guidance, "once again highlights Corning's lack of visibility into the LCD supply chain." White noted the warning could be just the beginning of lowered expectations for Corning's LCD glass business.

On Tuesday, Corning said third-quarter glass volume will be lower than originally expected, down 5% from the second quarter versus expectations in late July for flat volume. Demand in Corning's wholly owned business will fall 25% sequentially, while its Samsung Corning Precision Glass joint venture will rise 5% amid strong product levels at Korean panel makers, the company said.

"Our current view of the LCD market is that the supply chain is in the midst of an inventory correction," said Chief Financial Officer James B. Flaws.

Market research firm iSuppli said Tuesday that inventories of LCD monitors for desktop computers climbed during the second quarter as shipments outpaced sales and drove down prices. ISuppli also said last week that makers of panels for LCD TVs have felt renewed price pressure as set makers slash their production targets.

Nonetheless, Corning investors Tuesday looked past the weakening glass volume outlook to focus on other commentary from the company.

Corning, which reiterated its guidance for full-year glass market and LCD TV demand, said that pricing has remained stable with its previous expectations for slight sequential declines. The company also said LCD TV sales demand is still strong across all geographic regions except the U.S., and its other business areas, which make up about half of Corning's revenue, are in line with or exceeding expectations.

"There are substantial silver linings" in the news, Oppenheimer analyst Yair Reiner said.

-By Shara Tibken, Dow Jones Newswires; 212-416-2189; shara.tibken@dowjones.com

Corning (NYSE:GLW)
Gráfico Histórico do Ativo
De Jun 2024 até Jul 2024

Corning (NYSE:GLW)
Gráfico Histórico do Ativo
De Jul 2023 até Jul 2024