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Home >> Corning Reports Weaker Profits, ‘Modest’ Job Cuts
Corning, N.Y. — Specialty glass giant Corning disclosed Tuesday a lower quarterly profit as sales to consumer electronics, telecommunication and automotive markets fell, and announced upcoming “modest” job cuts to reduce costs.
Corning, which is well known in the consumer electronics industry for its highly shock- and scratch-resistant Gorilla Glass, used as cover glass in smartphones and TVs, said it expects a pretax charge of up to $50 million in the fourth quarter on restructuring.
“The weakening economy is affecting sales in many of our businesses, with several not achieving the growth expectations we set for the year,” James Flaws, Corning’s chief financial officer, said in statement. “These economic headwinds will persist next year.”
The company, which supplies LCD glass to such companies as LG Display, Sharp and Sony, fell to $521 million, from $811 million a year earlier.
The company said price declines for LCD glass in the July through September quarter impacted Corning’s display technologies division, which is its largest by revenue. The company expects glass volumes may drop further in the current quarter.
Overall revenue fell about 2 percent to $2.04 billion.
Corning reported nearly $700 billion in sales of Gorilla Glass during 2011, and said that Q3 2012 Gorilla Glass sales were up 21 percent to $363 million year to date.
The company anticipates the Gorilla Glass business growing to $1 billion per year and is “an essential element in Corning’s commitment to grow into a $10 billion company by 2014.”
The company issued a statement Wednesday saying that Gorilla Glass is now featured on 1 billion devices worldwide, including more than 500 consumer electronics product models from 33 major brands. Other brand customers for Gorilla Glass include Acer, Asus, Dell, Hewlett-Packard, HTC, Lenovo, Motorola and Nokia.
“In an industry once reliant on basic plastic or soda lime for device protection, Corning has been the driving force behind the migration into chemically strengthened glass,” Corning’s statement said Wednesday.
Meanwhile, project delays in the United States and weak demand in Europe led to a 7 percent fall off in sales for telecommunications products and equipment including optical fiber and cable to $523 million.
The company said it also suffered from the wind down of U.S. stimulus spending on optical cable to support telecommunications infrastructure projects.
Sales of its environmental technologies unit, which makes ceramic substrates and filter products for emissions control, fell 6 percent to $233 million.