Corning Raises 2018 Outlook Following Strong Second Quarter Results
Corning Inc. recently announced results for its 2018 second quarter, ended June 30, 2018.
Corning Inc. recently announced results for its 2018 second quarter, ended June 30, 2018. Solid second quarter results were reportedly driven by year-over-year sales growth in each of the company’s businesses; total GAAP sales reached $2.7 billion, up 10% compared to the 2017 second quarter, while core sales were $2.8 billion, a 9% increase compared to the prior year’s quarter.
“As planned, we undertook a phase of intense operating and capital investment to meet committed demand and capture new opportunities,” said Wendell P. Weeks, chairman, CEO and president. “We have now reached an inflection point in which these investments are yielding clear benefits. As a result, we are on track to meet increased demand, grow sales, and significantly improve profitability in the third quarter and beyond. We now expect full-year sales to reach approximately $11.3 billion.”
According to Tony Tripeny, senior vice president and chief financial officer, “Each of our businesses met or exceeded expectations for the second quarter. We now anticipate that 2018 will be even stronger than originally expected, with full-year sales up 10% to approximately $11.3 billion, and margin expansion in the second half of 2018.
“Optical Communications, Specialty Materials, Environmental Technologies, and Life Sciences segments are all expected to continue to grow, and the pricing environment in Display Technologies is the best in more than a decade. Several of our largest capacity expansion projects have exited the start-up phase, and production and efficiency rates are climbing. We expect a step-change in sales and profitability in the third quarter, and we plan to build on that going forward.”
Second quarter 2018 Display Technologies net sales were $780 million, up sequentially and year over year. Corning expects to reach the important milestone of annual price declines improving to a mid-single-digit percentage in the third quarter and the improvement trend to continue into 2019.
For the third quarter and full year 2018, Corning continues to expect that LCD glass market volume growth will be a mid-single-digit percentage, as television screen size growth continues. The company expects Corning’s volume to grow faster than the market, driven by the Gen 10.5 ramp up in Hefei, China. Third quarter sequential LCD glass price declines are expected to remain very moderate.
Optical Communications’ second quarter 2018 net sales were up 16% and exceeded $1 billion. Net income was up 17% year over year. Sales growth was driven by data center and carrier customers.
Third quarter sales are expected to be up approximately 25% year over year, including sales from the recently acquired 3M Communication Markets Division. For full year 2018, Optical Communications sales are expected to increase by a high-teens percentage over last year, with organic growth improving to the low teens and an additional $200 million from the acquisition.
Second quarter 2018 net sales for the Specialty Materials segment were $343 million, up 2% year over year. The company expects year-over-year sales growth in the third quarter of approximately 10%, driven by strong shipments of new innovative products.
Environmental Technologies’ second quarter 2018 net sales were up 21% to $317 million, and net income increased 42% to $54 million, compared with last year’s second quarter. All products contributed to the growth.
This strong performance is expected to continue in the third quarter, with sales growth up by a high-teens percentage year over year. For the full year 2018, Environmental Technologies sales are now expected to be up by a mid-teens percentage over last year.
In Life Sciences, second quarter 2018 net sales increased 11% and net income increased 41% year over year as the business continued to outpace market growth. Third quarter sales are expected to increase by a mid-single-digit percentage year over year. For the full year 2018, sales are expected to increase by a mid-to-high single-digit percentage.
Additional details are available at www.corning.com.