Corning Incorporated ( GLW Quick Quote GLW - Free Report) reported solid first-quarter 2021 results, wherein both the top line and the bottom line beat the respective Zacks Consensus Estimate. Net Income
On a GAAP basis, net income in the March quarter was $599 million or 67 cents per share against net loss of $96 million or loss of 16 cents per share in the prior-year quarter. The improvement primarily resulted from an operating income and a gain associated with the company’s currency-hedging contracts.
Core net income came in at $402 million or 45 cents per share compared with $177 million or 20 cents per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 3 cents. Revenues
Quarterly GAAP net sales increased 37.6% year over year to $3,290 million. Sales at all segments grew by double-digit percentages.
Core sales grew to $3,263 million from $2,529 million in the year-ago quarter. The top line surpassed the consensus estimate of $3,128 million. Segment Results
Net sales in
Optical Communications increased 18.5% year over year to $937 million. Sales grew in both enterprise and carrier networks, driven by the accelerated pace of data center builds, network capacity expansion and fiber-to-the-home projects. The segment’s net income was $111 million compared with $29 million in the prior-year quarter. Net sales in Display Technologies were $863 million compared with $751 million in the prior-year quarter, led by an increase in glass volume. The segment’s net income was $213 million compared with $152 million in the year-ago quarter. Specialty Materials’ net sales were up 28.1% year over year to $451 million. The rise was driven by solid demand for premium cover materials, strength in the IT market and the growing importance of semiconductor-related optical glasses. The segment’s net income was $91 million compared with $51 million in the prior-year quarter. Environmental Technologies’ net sales grew 37.8% year over year to $441 million. This was a result of improving markets and more Corning content. Notably, diesel sales were up 44% driven by demand in China and North America. The segment’s net income was $74 million compared with $35 million in the prior-year quarter. Net sales in Life Sciences were up 16.3% year over year to $300 million. This reflects strong demand across all regions, ongoing recovery in academic and pharmaceutical research labs and solid demand for bioproduction products and diagnostic-related consumables. The segment’s net income improved to $48 million from $38 million reported a year ago. Other Details
Cost of sales increased 16.6% year over year to $2,134 million. Gross profit improved to $1,156 million from $561 million. Core gross profit was $1,167 million compared with $844 million recorded in the prior-year quarter, with respective margins of 35.8% and 33.4%. Operating income was $502 million, which improved from a loss of $121 million.
Cash Flow & Liquidity
During the first quarter of 2021, Corning generated $723 million of net cash from operating activities compared with $248 million in the prior-year quarter.
As of Mar 31, 2021, the company had $2,868 million in cash and cash equivalents with $7,650 million of long-term debt compared with the respective tallies of $2,672 million and $7,816 million at the end of the previous quarter. Q2 Outlook
For the second quarter, Corning expects core sales in the range of $3.3 billion to $3.5 billion. Core earnings per share are estimated between 49 cents and 53 cents. The company anticipates strong demand and positive momentum across its businesses to continue throughout 2021.
Zacks Rank & Other Stocks to Consider
Corning currently carries a Zacks Rank #2 (Buy) and has a
VGM Score of B. Some other top-ranked stocks in the broader industry are Micron Technology ( MU Quick Quote MU - Free Report) , Western Digital Corporation ( WDC Quick Quote WDC - Free Report) and Vicor Corporation ( VICR Quick Quote VICR - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see . the complete list of today’s Zacks #1 Rank stocks here Micron delivered a trailing four-quarter earnings surprise of 6.5%, on average. Western Digital delivered a trailing four-quarter earnings surprise of 10.9%, on average. Vicor delivered a trailing four-quarter earnings surprise of 80.6%, on average. Time to Invest in Legal Marijuana
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