Corning Inc. (NYSE:GLW) Q2 2020 Earnings Conference Call - Final Transcript

Jul 28, 2020 • 08:30 am ET

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Corning Inc. (NYSE:GLW) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Corning Incorporated Second Quarter 2020 Earnings Conference Call. [Operator Instructions]

I would now like to hand the conference to your speaker today, Ann Nicholson, vice president of investor relations. Please go ahead, ma'am.

Executive
Ann H.S. Nicholson

Thank you, Joelle, and good morning. Welcome to Corning's second-quarter 2020 earnings call. With me today are Wendell Weeks, chairman and chief executive officer; Tony Tripeny, executive vice president and chief financial officer; and Jeff Evenson, executive vice president and chief strategy officer.

I'd like to remind you that today's remarks contain forward-looking statements that fall within the meaning of the Private Securities Litigation Reform Act of 1995. Those statements involve risks, uncertainties and other factors that could cause actual results to differ materially. These factors are detailed in the company's financial reports.

You should also note that we will be discussing our consolidated results using core performance measures, unless we specifically indicate our comments relate to GAAP data. Our core performance measures are non-GAAP measures used by management to analyze the business.

Reconciliation of core results to the comparable GAAP value can be found in the Investor Relations section of our website at corning.com. You may also access core results on our website with downloadable financials in the interactive analyst center. Supporting slides are being shown live on our webcast. We encourage you to follow along, and they're also available on our website for downloading.

Now I'll turn the call over to Wendell.

Executive
Wendell P. Weeks

Thank you, Ann, and good morning, everyone. This morning, we reported second-quarter 2020 results. Sales were $2.6 billion. Net income was $218 million. EPS was $0.25, and free cash flow was $285 million. All increased sequentially.

I have two primary observations on the quarter. First, we're effectively adjusting to this period of uncertainty with decisive action and operational execution. We're generating positive cash flow and maintaining a strong balance sheet. Second, even in these uncertain times, our strategy to deliver for our customers and outperform our markets is working. We're continuing to lead in the capabilities that make Corning distinctive. In fact, we advanced multiple growth initiatives during the quarter.

Let's consider the first observation in more detail. In the second quarter, we completed adjustments to our operating plan and continued to execute across the board by delivering operational improvements that will generate significant cost savings through 2021. We delivered sequential growth in sales, EPS and free cash flow. We also completed the vast majority of our anticipated restructuring, including the reprioritization of R&D programs. We believe we're continuing to position Corning for strong long-term growth and improved profitability.

Turning to my second observation. Our long-term strategy is sound, and our growth drivers are intact. As I've said before, we're not just counting on everybody buying more stuff, we're putting more Corning into the products that people already buy. This provides a mechanism for us to outperform our end markets, even in challenging environments. The relevance of our focused and cohesive portfolio