Courtesy Corning Incorporated
shares were trading lower Tuesday despite better-than-expected first-quarter financial results.
For the quarter, Corning (ticker: GLW) posted sales of $3.3 billion, up 38% from a year ago as reported, or 29% on an adjusted basis, and ahead of both the specialty-glass company’s guidance range of $3 billion to $3.2 billion and the Wall Street analyst consensus at $3.13 billion.
Core earnings, a non-GAAP measure, were 45 cents a share, ahead of the guidance range of 40 cents to 44 cents a share and Street consensus at 43 cents. On a GAAP basis, the company earned 67 cents a share, including a noncash mark-to-market gain on currency hedging contracts.
The company noted that profitability in the quarter was reduced by about $50 million due to higher freight and logistic costs and global supply-chain disruptions. CFO
Tony Tripeny
said in a statement that Corning expects those costs to normalize longer term, beginning to decline in the second quarter. “We will continue to do what it takes to deliver for our customers,” he said.
Corning noted that it had double-digit growth in all five of its business segments. Environmental Technologies, which includes automotive-emissions control products, was up 38%. Specialty Materials, including smartphone cover glass, was up 28%. Optical Communications, which is benefiting from the 5G wireless rollout, was up 18%, Life Sciences, which includes vials used for Covid-19 vaccine distribution, was up 16%, and Display Technologies, including glass used in flat-panel TVs, was up 15%.
Corning noted that it saw the most favorable first-quarter pricing environment in displays in more than a decade, and moderately increased prices for the second quarter, driven in part by high consumer demand for large-TV screen sizes.
For the second quarter, Corning sees revenue of $3.3 billion to $3.5 billion, and core earnings of 49 cents to 53 cents a share; previous Street consensus was $3.2 billion and 48 cents.
In morning trading, shares were down 3%, to $44.62. The stock is up 25% year to date, including a 22% gain since a recommendation from Barron’s in February.
Write to Eric J. Savitz at eric.savitz@barrons.com
