Corning(US:GLW)2025-10-28 11:05Financial Performance - In Q3 2025, core sales increased by 14% year over year to $4.27 billion, while core EPS rose by 24% to $0.67[4] - The core operating margin expanded by 130 basis points to 19.6% in Q3 2025, with an expected operating margin of 20% in Q4 2025, a year ahead of plan[5] - The company reported a strong adjusted free cash flow of $535 million in Q3 2025[4] - For Q4 2025, the company anticipates core sales of approximately $4.35 billion, with core EPS projected to grow to a range of $0.68 to $0.72[5] - GAAP sales for Q3 2025 were $4.10 billion, with a GAAP EPS of $0.50 and an operating margin of 14.4%[8] - Corning's net sales for Q3 2025 reached $4,100 million, a 21% increase from $3,391 million in Q3 2024[24] - Operating income for Q3 2025 was $589 million, significantly up from $302 million in Q3 2024, marking a 95% increase[24] - Net income attributable to Corning Incorporated was $430 million in Q3 2025, a turnaround from a net loss of $117 million in Q3 2024[24] - Basic earnings per share for Q3 2025 was $0.50, compared to a loss of $0.14 per share in Q3 2024[27] - Core net income for Q3 2025 was $585 million, up from $465 million in Q3 2024, resulting in core earnings per share of $0.67[28] Growth Drivers - Optical Communications' Enterprise sales surged by 58% year over year, driven by strong demand for new Gen AI products[1] - The company expects continued strong growth driven by robust demand for Gen AI products and solar wafers[5] - The company has added $4 billion to its annualized sales run rate since the implementation of the Springboard plan[4] Margins and Returns - Core ROIC improved by 160 basis points to 13.4% year over year[4] - Gross margin improved to $1,520 million in Q3 2025, compared to $1,137 million in Q3 2024, reflecting a gross margin percentage increase from 33.5% to 37.0%[24] - Core operating income for the three months ended September 30, 2025, was $838 million, an increase from $682 million in the same period of 2024, reflecting a core operating margin of 19.6% compared to 18.3%[49] - For the nine months ended September 30, 2025, the company reported a gross margin of $4,126 million, with a gross margin percentage of 36.1%, compared to $3,079 million and 32.0% for the same period in 2024[46] Cash Flow and Assets - The company reported net cash provided by operating activities of $784 million for Q3 2025, an increase from $699 million in Q3 2024[26] - The company’s cash flows from operating activities for the nine months ended September 30, 2025, were $1,643 million, compared to $1,316 million for the same period in 2024[48] - Total assets increased to $29,916 million as of September 30, 2025, from $27,735 million at the end of 2024[25] - Cash and cash equivalents at the end of Q3 2025 were $1,648 million, a slight decrease from $1,768 million at the end of 2024[25] Liabilities and Equity - Corning's total liabilities rose to $17,911 million as of September 30, 2025, compared to $16,665 million at the end of 2024[25] - The company reported a total equity of $12,005 million and total debt of $8,219 million as of September 30, 2025[49] Tax and Currency Impact - Net income attributable to Corning of $430 million, reflecting an effective tax rate of 14.5%[35] - The core performance measures for the same period showed net sales of $4,272 million and net income of $585 million, resulting in a core effective tax rate of 19.5%[35] - For the nine months ended September 30, 2025, net income attributable to Corning at $1,056 million and an effective tax rate of 15.9%[40] - The constant-currency adjustment for the three months ended September 30, 2025, contributed an additional $156 million to the gross margin[45] - The company utilized constant-currency reporting to mitigate the impact of currency fluctuations, particularly significant for the Japanese yen in the Display segment[33] Acquisition Costs - Acquisition-related costs for the three months ended September 30, 2025, amounted to $30 million, contributing to the overall financial performance[35] - The company incurred acquisition-related costs of $27 million for the three months ended September 30, 2025[45]