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Corning Reports Q221 Revenue of $3.5B up 35%; Display Revenue up 24.6% Y/Y
Corning reported Q221 results of $3.5b in sales, up 6.4% sequentially and up 35% Y/Y. Net Income was $459M up 111% Y/Y, the best results since 2014, margins grew from 24.7% sequentially to 26.4% in Q221 against 20.2% in Q220. The Y/Y gains are partly due to the unusually ow results in 2020 caused by the pandemic. Display Technology revenue was $939M, 8.7% sequentially and 24.6% Y/Y, Specialty Materials had sales of $483m up 7.1% sequentially and 15.8% Y/Y. Net income was $248M, up 16% sequentially and 63% Y/Y. New product spending for the Specialty Materials division was given as the reason for the lower margins, with no specific timetable for when that would be alleviated.
Guidance was tepid, at 3Q sales of $3.5 - $3.7b (GAAP), while EPS guidance was $0.54 to $0.59, with a bit of caution concerning inflation at various points in the company as a gating factor for margins, which accounted for a 150bps drag from such concerns in Q221 and are expected to similar in Q321. Corning took steps to alleviate those supply chain issues in 2Q, band expect to encounter similar issues in Q321 with a similar 150 bps drag on margins.
The company raised glass pricing in Q221 and will do so again in Q321 to cover material cost inflation. Glass pricing has been extremely favorable to Corning for the last few quarters, especially in 2021, but it seemed that they were more cautious on how glass pricing would play out for the remainder of the year and 2022 given the uncertainty of TV panel prices.
With ~70% of the glass market based on TV panel surface area, Corning relies on average panel size increases to grow their market in display but has had the added capability to increase glass prices in recent quarters. As panel prices flatten or decline, it could create pressure on glass pricing as panel makers have historical looked for glass price reductions when panel prices fell. Corning seemed cautiously optimistic concerning the remainder of the year, at least in the display space.
Corning reported Q221 results of $3.5b in sales, up 6.4% sequentially and up 35% Y/Y. Net Income was $459M up 111% Y/Y, the best results since 2014, margins grew from 24.7% sequentially to 26.4% in Q221 against 20.2% in Q220. The Y/Y gains are partly due to the unusually ow results in 2020 caused by the pandemic. Display Technology revenue was $939M, 8.7% sequentially and 24.6% Y/Y, Specialty Materials had sales of $483m up 7.1% sequentially and 15.8% Y/Y. Net income was $248M, up 16% sequentially and 63% Y/Y. New product spending for the Specialty Materials division was given as the reason for the lower margins, with no specific timetable for when that would be alleviated.
Guidance was tepid, at 3Q sales of $3.5 - $3.7b (GAAP), while EPS guidance was $0.54 to $0.59, with a bit of caution concerning inflation at various points in the company as a gating factor for margins, which accounted for a 150bps drag from such concerns in Q221 and are expected to similar in Q321. Corning took steps to alleviate those supply chain issues in 2Q, band expect to encounter similar issues in Q321 with a similar 150 bps drag on margins.
The company raised glass pricing in Q221 and will do so again in Q321 to cover material cost inflation. Glass pricing has been extremely favorable to Corning for the last few quarters, especially in 2021, but it seemed that they were more cautious on how glass pricing would play out for the remainder of the year and 2022 given the uncertainty of TV panel prices.
With ~70% of the glass market based on TV panel surface area, Corning relies on average panel size increases to grow their market in display but has had the added capability to increase glass prices in recent quarters. As panel prices flatten or decline, it could create pressure on glass pricing as panel makers have historical looked for glass price reductions when panel prices fell. Corning seemed cautiously optimistic concerning the remainder of the year, at least in the display space.
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