Corning Incorporated (NYSE: GLW) is providing the following updates
on the performance of its business segments in the third quarter
ending Sept. 30, 2019, reducing expectations for two – Display
Technologies and Optical Communications – and maintaining guidance
in its other three.
Display Technologies Segment UpdateWithin
Corning’s Display Technologies segment, several panel manufacturing
customers have reduced utilization below anticipated levels in the
current quarter. Consequently, Corning is reducing its Display
volume forecast to a sequential decline of a high-single digit
percentage in the third quarter.
For the full year, the company now expects display glass volume
to be up slightly and to outperform the overall glass market,
driven by the company’s ramp-up of its Gen 10.5 manufacturing
capacity.
Corning’s expectations for full-year 2019 glass prices are
unchanged. The company continues to expect third-quarter prices to
be flat with the second quarter, and full year glass prices to
decline at a low-to-mid single digit percentage.
Retail demand continues to track to Corning’s expectations, with
TV viewing area growing year-to-date through July. Set makers are
purchasing panels more conservatively, apparently due to macro
uncertainty, which is driving panel maker utilization reductions.
Corning expects this supply chain adjustment to be temporary and
panel maker utilization to increase in first-half 2020 over
second-half 2019.
Optical Communications Segment UpdateWithin
Corning’s Optical Communications segment, several major carriers
are further reducing capital spending on cable deployments and
fiber-to-the-home projects. In addition, some enterprise customers
have reduced their spending below anticipated levels. Consequently,
Corning now expects third-quarter Optical Communications sales to
decline year-over-year by a low-teen percentage, versus a prior
expectation of a low-single digit percentage
decline.
For the full-year 2019, Corning now forecasts Optical
Communications sales will decline by 3% to 5%, versus its prior
expectation of a low-to-mid-single digit percentage increase.
Corning expects both carrier and enterprise network sales to
decline year-over-year in the second half of 2019.
Capacity and Cost ActionsCorning is providing
the investment community with this update based on an assessment of
current customer and market dynamics. As a result, management is
taking actions to lower cost to align with revised sales
expectations. These actions include capacity adjustments in Display
and Optical Communications, reductions in operating expenses, and
pacing of capital projects.
Additional details on second-half performance expectations can
be found on the Web Disclosure section of Corning’s Investor
Relations website, at
https://investor.corning.com/investor-relations/news-and-events/web-disclosures/default.aspx.Corning
intends to formally report results for the third quarter of 2019 on
Oct. 29, 2019. It also intends to update its view of the fourth
quarter of 2019 on its conference call with the investment
community that day.
Caution Concerning Forward-Looking
StatementsThis press release contains “forward-looking
statements” (within the meaning of the Private Securities
Litigation Reform Act of 1995), which are based on current
expectations and assumptions about Corning’s financial results and
business operations, that involve substantial risks and
uncertainties that could cause actual results to differ materially.
These risks and uncertainties include: the effects of acquisitions,
dispositions and other similar transactions by the Company, the
effect of global business, financial, economic and political
conditions; tariffs and import duties; currency fluctuations
between the U.S. dollar and other currencies, primarily the
Japanese yen, New Taiwan dollar, euro, Chinese yuan, and South
Korean won; product demand and industry capacity; competitive
products and pricing; availability and costs of critical components
and materials; new product development and commercialization; order
activity and demand from major customers; the amount and timing of
our cash flows and earnings and other conditions, which may affect
our ability to pay our quarterly dividend at the planned level or
to repurchase shares at planned levels; possible disruption in
commercial activities due to terrorist activity, cyber-attack,
armed conflict, political or financial instability, natural
disasters, or major health concerns; unanticipated disruption to
equipment, facilities, IT systems or operations; effect of
regulatory and legal developments; ability to pace capital spending
to anticipated levels of customer demand; rate of technology
change; ability to enforce patents and protect intellectual
property and trade secrets; adverse litigation; product and
components performance issues; retention of key personnel; customer
ability, most notably in the Display Technologies segment, to
maintain profitable operations and obtain financing to fund their
ongoing operations and manufacturing expansions and pay their
receivables when due; loss of significant customers; changes in tax
laws and regulations including the Tax Cuts and Jobs Act of 2017;
and the potential impact of legislation, government regulations,
and other government action and investigations.
For a complete listing of risks and other factors, please
reference the risk factors and forward-looking statements described
in our annual reports on Form 10-K and quarterly reports on Form
10-Q. Forward-looking statements speak only as of the day that they
are made, and Corning undertakes no obligation to update them in
light of new information or future events.
Web Disclosure In accordance with guidance
provided by the SEC regarding the use of company websites and
social media channels to disclose material information, Corning
Incorporated (“Corning”) wishes to notify investors, media, and
other interested parties that it uses its website
(http://www.corning.com/worldwide/en/about-us/news-events.html) to
publish important information about the company, including
information that may be deemed material to investors, or
supplemental to information contained in this or other press
releases. The list of websites and social media channels that the
company uses may be updated on Corning’s media and website from
time to time. Corning encourages investors, media, and other
interested parties to review the information Corning may publish
through its website and social media channels as described above,
in addition to the company’s SEC filings, press releases,
conference calls, and webcasts.
About Corning IncorporatedCorning
(www.corning.com) is one of the world's leading innovators in
materials science, with a more than 165-year track record of
life-changing inventions. Corning applies its unparalleled
expertise in glass science, ceramic science, and optical physics
along with its deep manufacturing and engineering capabilities to
develop category-defining products that transform industries and
enhance people's lives. Corning succeeds through sustained
investment in RD&E, a unique combination of material and
process innovation, and deep, trust-based relationships with
customers who are global leaders in their industries.
Corning's capabilities are versatile and synergistic, which
allows the company to evolve to meet changing market needs, while
also helping our customers capture new opportunities in dynamic
industries. Today, Corning's markets include optical
communications, mobile consumer electronics, display technology,
automotive, and life sciences vessels. Corning's industry-leading
products include damage-resistant cover glass for mobile devices;
precision glass for advanced displays; optical fiber, wireless
technologies, and connectivity solutions for state-of-the-art
communications networks; trusted products to accelerate drug
discovery and delivery; and clean-air technologies for cars and
trucks.
Media Relations
Contact: M. Elizabeth
Dann
(607)
974-4989
dannme@corning.com
Investor Relations Contact: Ann H.S. Nicholson
(607) 974-6716 nicholsoas@corning.com
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