Corning Expects Second-Quarter Core Sales to Exceed Guidance, with Core EPS at the High End of or Slightly Above Guided Range
Corning (NYSE: GLW) has updated its second-quarter 2024 expectations, projecting core sales of approximately $3.6 billion, up from the previous guidance of $3.4 billion. Core EPS is now anticipated to be at the high end or slightly above the guided range of $0.42 to $0.46. This growth is driven by strong adoption of their new optical connectivity products for Generative AI. Corning's 'Springboard' framework, expected to generate over $3 billion in annualized sales, is also contributing to this positive outlook. The company is confident in its market position and anticipates strong incremental profit and cash flow. Corning started its share buyback program in Q2 2024, demonstrating confidence in value creation for shareholders. Detailed results will be reported on July 30, 2024.
- Second-quarter core sales expected to reach $3.6 billion, above previous guidance of $3.4 billion.
- Core EPS projected at the high end or slightly above the guided range of $0.42 to $0.46.
- Strong adoption of new optical connectivity products for Generative AI.
- 'Springboard' framework expected to add over $3 billion in annualized sales in the next three years.
- Company started share buyback program in Q2 2024.
- None.
Insights
Corning has revised its Q2 core sales forecast upward, projecting approximately
The anticipated core EPS is at the high end of the guided range of
The announcement of the 'Springboard' framework, aiming to add more than
Retail investors should note that Corning has started a share buyback program in Q2, demonstrating confidence in its growth prospects and aiming to increase shareholder returns.
However, it's important to consider the optimistic outlook relies on market trends and customer adoption rates, which can be volatile. Investors should track upcoming earnings reports for Q2 for confirmation of these projections.
Corning's forecast adjustment is largely attributed to the successful adoption of new optical connectivity products for Generative AI. These products are important as AI advancements increasingly demand high-speed data transfer and connectivity. This market segment is poised for substantial growth, providing Corning with an advantageous position.
Generative AI frameworks require solid infrastructure for data processing and transfer and Corning’s innovations in optical connectivity meet this demand effectively. This aligns with industry trends towards higher bandwidth and lower latency requirements.
Investors should recognize that technological innovation is a core strength for Corning. Given that the company's existing production capacity and technical capabilities are sufficient to meet anticipated demand, the risk of supply chain bottlenecks is minimized.
Nevertheless, the reliance on ongoing AI industry growth introduces exposure to potential technological and market shifts. Monitoring advancements in AI technology and related infrastructure will be essential to gauge Corning’s sustained competitiveness.
Management now expects Q2 core sales of approximately
Outperformance primarily driven by strong adoption of new optical connectivity products for Generative AI
‘Springboard’ framework is expected to add more than
Wendell Weeks, chairman and chief executive officer, said, “We expect second-quarter core sales to exceed our previous guidance and mark a return to year-over-year growth. The outperformance was primarily driven by the strong adoption of our new optical connectivity products for Generative AI. These results reinforce our confidence in ‘Springboard’ – Corning’s plan to add more than
Three Core Components of “Springboard” Framework:
- Management believes that first-quarter 2024 will be the lowest quarter for the year.
-
The company expects to grow by more than
in annualized sales in the next three years, driven by a combination of cyclical factors and secular trends. The outlook in each of the company’s markets is positive, and its market positions are strong. Innovative products and deep customer relationships position$3 billion Corning well to capitalize on these opportunities. -
As
Corning captures this growth, management expects to deliver powerful incremental profit and cash flow. The company already has the required production capacity and technical capabilities in place, and the cost and capital are already reflected in its financials.
Weeks continued, “We’re off to a great start with our ‘Springboard’ plan. We’ve positioned the company to capture significant growth with powerful incremental profit and cash flow. Because of our confidence in Springboard, we began buying back our shares in the second quarter. We’re energized by the tremendous opportunity for value creation we’ve built for our shareholders.”
Presentation of Information in this News Release
This news release includes non-GAAP financial measures. Non-GAAP financial measures are not in accordance with, or an alternative to, GAAP. Corning’s non-GAAP financial measures exclude the impact of items that are driven by general economic conditions and events that do not reflect the underlying fundamentals and trends in the company’s operations. The company believes presenting non-GAAP financial measures assists in analyzing financial performance without the impact of items that may obscure trends in the company’s underlying performance. Definitions of these non-GAAP financial measures and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found on the company’s website by going to the Investor Relations page and clicking “Quarterly Results” under the “Financials and Filings” tab. These reconciliations also accompany this news release.
With respect to the outlook for future periods, it is not possible to provide reconciliations for these non-GAAP measures because management does not forecast the movement of foreign currencies against the
Caution Concerning Forward-Looking Statements
The statements contained in this release and related comments by management that are not historical facts or information and contain words such as “will,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “seek,” “see,” “would,” “target,” “estimate,” “forecast” or similar expressions are forward-looking statements. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and include estimates and assumptions related to economic, competitive and legislative developments. Such statements relate to future events that by their nature address matters that are, to different degrees, uncertain. These forward-looking statements relate to, among other things, the company’s future operating performance, the company’s share of new and existing markets, the company’s revenue and earnings growth rates, the company’s ability to innovate and commercialize new products, the company’s expected capital expenditure and the company’s implementation of cost-reduction initiatives and measures to improve pricing, including the optimization of the company’s manufacturing capacity.
Although the company believes that these forward-looking statements are based upon reasonable assumptions regarding, among other things, current estimates and forecasts, general economic conditions, its knowledge of its business and key performance indicators that impact the company, there can be no assurance that these forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change except as required by applicable securities laws.
Some of the risks, uncertainties and other factors that could cause actual results to differ materially from those expressed in or implied by the forward-looking statements include, but are not limited to: global economic trends, competition and geopolitical risks, or an escalation of sanctions, tariffs or other trade tensions between the
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.
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 (https://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.
About Corning Incorporated
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