Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 13, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | CORNING INC /NY | |
Entity Central Index Key | 24,741 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 869,057,436 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Consolidated Statements of Income [Abstract] | ||||
Net sales | $ 2,607 | $ 2,507 | $ 7,479 | $ 6,914 |
Cost of sales | 1,551 | 1,466 | 4,481 | 4,158 |
Gross margin | 1,056 | 1,041 | 2,998 | 2,756 |
Operating expenses: | ||||
Selling, general and administrative expenses | 372 | 302 | 1,067 | 1,104 |
Research, development and engineering expenses | 213 | 187 | 620 | 569 |
Amortization of purchased intangibles | 18 | 17 | 53 | 46 |
Restructuring, impairment and other charges | 78 | |||
Operating income | 453 | 535 | 1,258 | 959 |
Equity in earnings of affiliated companies | 31 | 19 | 148 | 119 |
Interest income | 10 | 9 | 33 | 21 |
Interest expense | (37) | (41) | (112) | (122) |
Translated earnings contract gain (loss), net | 26 | (237) | (193) | (2,295) |
Gain on realignment of equity investment | 2,676 | |||
Other expense, net | (4) | (28) | (43) | (70) |
Income before income taxes | 479 | 257 | 1,091 | 1,288 |
(Provision) benefit for income taxes (Note 4) | (89) | 27 | (176) | 835 |
Net income attributable to Corning Incorporated | $ 390 | $ 284 | $ 915 | $ 2,123 |
Earnings per common share attributable to Corning Incorporated: | ||||
Basic (Note 5) | $ 0.41 | $ 0.27 | $ 0.93 | $ 1.96 |
Diluted (Note 5) | 0.39 | 0.26 | 0.89 | 1.81 |
Dividends declared per common share | $ 0.155 | $ 0.135 | $ 0.465 | $ 0.405 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Consolidated Statements of Comprehensive Income [Abstract] | ||||
Net income attributable to Corning Incorporated | $ 390 | $ 284 | $ 915 | $ 2,123 |
Foreign currency translation adjustments and other | 53 | 245 | 457 | 869 |
Net unrealized (losses) gains on investments | (2) | 14 | (3) | |
Unamortized (losses) gains and prior service credits for postretirement benefit plans | (5) | 17 | 260 | |
Net unrealized gains (losses) on designated hedges | 4 | 11 | 42 | (30) |
Other comprehensive income, net of tax (Note 13) | 55 | 251 | 530 | 1,096 |
Comprehensive income attributable to Corning Incorporated | $ 445 | $ 535 | $ 1,445 | $ 3,219 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 3,865 | $ 5,291 |
Trade accounts receivable, net of doubtful accounts and allowances - $63 and $59 | 1,748 | 1,481 |
Inventories, net of inventory reserves - $162 and $151 (Note 6) | 1,693 | 1,471 |
Other current assets | 948 | 805 |
Total current assets | 8,254 | 9,048 |
Investments (Note 7) | 352 | 336 |
Property, plant and equipment, net of accumulated depreciation - $10,684 and $9,884 | 13,344 | 12,546 |
Goodwill, net (Note 8) | 1,684 | 1,577 |
Other intangible assets, net (Note 8) | 891 | 796 |
Deferred income taxes (Note 4) | 2,641 | 2,325 |
Other assets | 928 | 1,271 |
Total Assets | 28,094 | 27,899 |
Current liabilities: | ||
Current portion of long-term debt and short-term borrowings (Note 3) | 631 | 256 |
Accounts payable | 1,179 | 1,079 |
Other accrued liabilities (Note 2 and Note 10) | 1,255 | 1,416 |
Total current liabilities | 3,065 | 2,751 |
Long-term debt | 3,994 | 3,646 |
Postretirement benefits other than pensions (Note 9) | 712 | 737 |
Other liabilities (Note 2 and Note 10) | 2,940 | 2,805 |
Total liabilities | 10,711 | 9,939 |
Commitments, contingencies and guarantees (Note 2) | ||
Shareholders’ equity (Note 13): | ||
Convertible preferred stock, Series A – Par value $100 per share; Shares authorized 3,100; Shares issued: 2,300 | 2,300 | 2,300 |
Common stock – Par value $0.50 per share; Shares authorized 3.8 billion; Shares issued: 1,706 million and 1,691 million | 853 | 846 |
Additional paid-in capital – common stock | 14,013 | 13,695 |
Retained earnings | 17,533 | 16,880 |
Treasury stock, at cost; Shares held: 837 million and 765 million | (16,236) | (14,152) |
Accumulated other comprehensive loss | (1,146) | (1,676) |
Total Corning Incorporated shareholders’ equity | 17,317 | 17,893 |
Noncontrolling interests | 66 | 67 |
Total equity | 17,383 | 17,960 |
Total Liabilities and Equity | $ 28,094 | $ 27,899 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Consolidated Balance Sheets [Abstract] | ||
Doubtful accounts and allowances | $ 63 | $ 59 |
Inventory reserves | 162 | 151 |
Accumulated depreciation | $ 10,684 | $ 9,884 |
Convertible preferred stock, par value (in dollars per share) | $ 100 | $ 100 |
Convertible preferred stock, shares authorized (in shares) | 3,100 | 3,100 |
Convertible preferred stock, shares issued (in shares) | 2,300 | 2,300 |
Common stock, par value (in dollars per share) | $ 0.50 | $ 0.50 |
Common stock, shares authorized (in shares) | 3,800,000,000 | 3,800,000,000 |
Common stock, shares issued (in shares) | 1,706,000,000 | 1,691,000,000 |
Treasury stock, shares held (in shares) | 837,000,000 | 765,000,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash Flows from Operating Activities: | ||
Net income | $ 915 | $ 2,123 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 799 | 844 |
Amortization of purchased intangibles | 53 | 46 |
Restructuring, impairment and other charges | 78 | |
Equity in earnings of affiliated companies | (148) | (119) |
Dividends received from affiliated companies | 101 | 20 |
Deferred tax benefit | (62) | (1,047) |
Translated earnings contract loss | 193 | 2,295 |
Unrealized translation gains on transactions | (264) | (177) |
Gain on realignment of equity investment | (2,676) | |
Changes in certain working capital items: | ||
Trade accounts receivable | (190) | (184) |
Inventories | (166) | (69) |
Other current assets | (109) | (42) |
Accounts payable and other current liabilities | (123) | 28 |
Other, net | 117 | (11) |
Net cash provided by operating activities | 1,116 | 1,109 |
Cash Flows from Investing Activities: | ||
Capital expenditures | (1,247) | (815) |
Acquisition of business, net of cash received | (171) | (279) |
Cash received on realignment of equity investment | 4,818 | |
Short-term investments – acquisitions | (20) | |
Short-term investments – liquidations | 29 | 121 |
Realized gains on translated earnings contracts | 199 | 146 |
Other, net | (28) | (15) |
Net cash (used in) provided by investing activities | (1,218) | 3,956 |
Cash Flows from Financing Activities: | ||
Net repayments of short-term borrowings and current portion of long-term debt | (85) | |
Principal payments under capital lease obligations | (1) | (1) |
Payments of employee withholding tax on stock awards | (14) | (14) |
Proceeds from issuance of long-term debt, net | 702 | |
Proceeds from issuance of commercial paper | (481) | |
Proceeds from the exercise of stock options | 275 | 86 |
Repurchases of common stock for treasury | (2,064) | (3,884) |
Dividends paid | (493) | (493) |
Net cash used in financing activities | (1,595) | (4,872) |
Effect of exchange rates on cash | 271 | 128 |
Net (decrease) increase in cash and cash equivalents | (1,426) | 321 |
Cash and cash equivalents at beginning of period | 5,291 | 4,500 |
Cash and cash equivalents at end of period | $ 3,865 | $ 4,821 |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | 1. Significant Accounting Policies Basis of Presentation In these notes, the terms “Corning,” “Company,” “we,” “us,” or “our” mean Corning Incorporated and its subsidiary companies. The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial information. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been omitted or condensed. These interim consolidated financial statements should be read in conjunction with Corning’s consolidated financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2016 (“ 2016 Form 10-K”). The unaudited consolidated financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results of operations, financial position and cash flows for the interim periods presented. All such adjustments are of a normal recurring nature. The results for interim periods are not necessarily indicative of results which may be expected for any other interim period or for the full year. On January 1, 2017, Corning adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, the impacts of which include the recording of cumulative tax benefits of $233 million in beginning retained earnings and cash flow reclassifications that were not significant. Certain prior year amounts have been reclassified to conform to the current-year presentation. These reclassifications had no impact on our results of operations, financial position, or changes in shareholders’ equity. New Accounting Standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, as a new Topic, Accounting Standards Codification (“ASC”) Topic 606. The new revenue recognition standard relates to revenue from contracts with customers, which, along with amendments issued in 2015 and 2016, will supersede nearly all current U.S. GAAP guidance on this topic and eliminate industry-specific guidance. The underlying principle is to use a five-step analysis of transactions to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Corning has evaluated its material contracts, and has concluded that the impact of adopting the standard on its financial statements and related disclosure will not be material. The standard, as amended, will be effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. We will adopt the standard on a modified retrospective basis in 2018. Corning’s equity affiliates are currently evaluating their material contracts, and have not concluded on the potential impact of adopting ASU 2014-09 on their financial statements and related disclosure. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes all existing guidance on accounting for leases in ASC Topic 840. ASU 2016-02 is intended to provide enhanced transparency and comparability by requiring lessees to record right-of-use assets and corresponding lease liabilities on the balance sheet. ASU 2016-02 will continue to classify leases as either finance or operating, with classification affecting the pattern of expense recognition in the statement of income. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. ASU 2016-02 is required to be applied with a modified retrospective approach to each prior reporting period presented with various optional practical expedients. We are currently assessing the potential impact of adopting ASU 2016-02 on our financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 refines how companies classify certain aspects of the cash flow statement in regards to debt prepayment, settlement of debt instruments, contingent consideration payments, proceeds from insurance claims and life insurance policies, distribution from equity method investees, beneficial interests in securitization transactions and separately identifiable cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, and for interim periods within those fiscal years. We are currently assessing the potential impact of adopting ASU 2016-15 on our financial statements and related disclosures, but the effect is not expected to be material. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which reduces the complexity in the accounting standards by allowing the recognition of current and deferred income taxes for an intra-entity asset transfer, other than inventory, when the transfer occurs. Historically, recognition of the income tax consequence was not recognized until the asset was sold to an outside party. This amendment should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. ASU 2016-16 is effective for annual periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities as of the beginning of an annual reporting period for which financial statements (interim or annual) have not been issued or made available for issuance. That is, earlier adoption should be in the first interim period if an entity issues interim financial statements. We are currently evaluating the impact of ASU 2016-16 on our consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350). ASU 2017-04 simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual, or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopt ed the ASU on January 1, 2017. In March 2017, the FASB issued ASU No. 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 requires entities to (1) disaggregate the current-service-cost component from the other components of net benefit cost (the “other components”) and present it with other current compensation costs for related employees in the income statement and (2) present the other components elsewhere in the income statement and outside of income from operations if that subtotal is presented. In addition, the ASU requires entities to disclose the income statement lines that contain the other components if they are not presented on appropriately described separate lines. The amendment should be applied retrospectively for the presentation of the service cost component and prospectively for the capitalization of the service cost component. ASU 2017-07 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted at the beginning of any annual period for which an entity’s financial statements have not been issued or made available for issuance. We are currently evaluating the impact of ASU 2017-07 on our consolidated financial statements and related disclosures , but the impact is not expected to be material . |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 9 Months Ended |
Sep. 30, 2017 | |
Commitments, Contingencies and Guarantees [Abstract] | |
Commitments, Contingencies and Guarantees | 2. Commitments, Contingencies and Guarantees Asbestos Claims Corning and PPG Industries, Inc. each owned 50% of the capital stock of Pittsburgh Corning Corporation (“PCC”). PCC filed for Chapter 11 reorganization in 2000 and the Modified Third Amended Plan of Reorganization for PCC (the “Plan”) became effective in April 2016. At December 31, 2016, this estimated liability was $ 290 million, due to the Company’s contribution, in the second quarter of 2016, of its equity interests in PCC and Pittsburgh Corning Europe N.V. (“PCE”) in the total amount of $238 million, as required by the Plan. A payment for $70 million was made in June 2017. At September 30, 2017, the total amount of payments due in years 2018 through 2022 is $220 million. A $35 million payment is due in the second quarter of 2018 and is classified as a current liability. The remaining $ 185 million is classified as a non-current liability. Non-PCC Asbestos Claims Insurance Litigation Corning is a defendant in certain cases alleging injuries from asbestos unrelated to PCC (the “non-PCC asbestos claims”) which had been stayed pending the confirmation of the Plan. The stay was lifted on August 25, 2016. Corning previously established a $150 million reserve for these non-PCC asbestos claims. The estimated reserve represents the undiscounted projection of claims and related legal fees over the next 20 years. The amount may need to be adjusted in future periods as more data becomes available; however, we cannot estimate any lesser or greater liabilities at this time. At September 30, 2017 and December 31, 2016, the amount of the reserve for these non-PCC asbestos claims was $148 million and $149 million, respectively. Several of Corning’s insurers have commenced litigation in state courts for a declaration of the rights and obligations of the parties under insurance policies related to Corning’s asbestos claims. Corning has resolved these issues with a majority of its relevant insurers, and is vigorously contesting these cases with the remaining relevant insurers. Management is unable to predict the outcome of the litigation with these remaining insurers. Other Commitments and Contingencies We are required, at the time a guarantee is issued, to recognize a liability for the fair value or market value of the obligation it assumes. In the normal course of our business, we do not routinely provide significant third-party guarantees. Generally, any third party guarantees provided by Corning are limited to certain financial guarantees including stand-by letters of credit and performance bonds, and the incurrence of contingent liabilities in the form of purchase price adjustments related to attainment of milestones. When provided, these guarantees have various terms, and none of these guarantees are individually significant. As of September 30, 2017 and December 31, 2016 , contingent guarantees totaled a notional value of $317 million and $ 267 million, respectively. We believe a significant majority of these contingent guarantees will expire without being funded. We also were contingently liable for purchase obligations of $230 million and $ 231 million, at September 30, 2017 and December 31, 2016 , respectively. Product warranty liability accruals were considered insignificant at September 30, 2017 and December 31, 2016 . Corning is a defendant in various lawsuits, including environmental and product-related suits, and is subject to various claims that arise in the normal course of business. In the opinion of management, the likelihood that the ultimate disposition of these matters will have a material adverse effect on Corning’s consolidated financial position, liquidity, or results of operations, is remote. Other than certain asbestos related claims, there are no other material loss contingencies related to litigation. Corning has been named by the Environmental Protection Agency (“the Agency”) under the Superfund Act, or by state governments under similar state laws, as a potentially responsible party for 16 active hazardous waste sites. Under the Superfund Act, all parties who may have contributed any waste to a hazardous waste site, identified by the Agency, are jointly and severally liable for the cost of cleanup unless the Agency agrees otherwise. It is Corning’s policy to accrue for its estimated liability related to Superfund sites and other environmental liabilities related to property owned by Corning based on expert analysis and continual monitoring by both internal and external consultants. At September 30, 2017 and December 31, 2016 , Corning had accrued approximately $ 40 million (undiscounted) and $ 43 million (undiscounted), respectively, for the estimated liability for environmental cleanup and related litigation. Based upon the information developed to date, management believes that the accrued reserve is a reasonable estimate of the Company’s liability and that the risk of an additional loss in an amount materially higher than that accrued is remote. The ability of certain subsidiaries and affiliated companies to transfer funds is limited by provisions of foreign government regulations, affiliate agreements and certain loan agreements. At September 30, 2017 , the amount of equity subject to such restrictions for consolidated subsidiaries and affiliated companies was not significant. While this amount is legally restricted, it does not result in operational difficulties since we have generally permitted subsidiaries to retain a majority of equity to support their growth programs. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2017 | |
Debt [Abstract] | |
Debt | 3 . Debt Based on borrowing rates currently available to us for loans with similar terms and maturities, the fair value of long-term debt was $4.4 billion and $3.9 billion at September 30, 2017 and December 31, 2016 , respectively, compared to recorded book values of $4.0 billion at September 30, 2017 and $3.6 billion at December 31, 2016. The Company measures the fair value of its long-term debt using Level 2 inputs based primarily on current market yields for its existing debt traded in the secondary market. Corning did not have outstanding commercial paper at September 30, 2017 and December 31, 2016. Debt Issuances 2017 In the third quarter of 2017, Corning issued three Ja panese y en -denominated debt securities (the “Notes”) , as follows: · ¥21 billion 0.698% senior unsecured long term notes with a mat urity of 7 years; · ¥47 billion 0.992% senior unsecured long term notes with a maturity of 10 years ; and · ¥10 billion 1.583% senior unsecured long term notes with a maturity of 20 years. The proceeds from these Notes were received in Japanese y en and converted to U.S. dollars on the date of issuance. The net proceeds received in U.S. dollars, after deducting offering expenses, was approximately $700 million. Payments of principle and interest on the Notes will be in Japanese y en , or should y en be unavailable due to circumstance s beyond Corning’s control , a U.S. dollar equivalent . On a quarterly basis, Corning will recognize the transaction gains and losses resulting from changes in the JPY/USD exchange rate in the Other expense, net line of the Consolidated Statement s of Income. Cash proceeds from the offering s and payments for debt issuance cost s are disclosed as financing activities , and cash payments to bondholders for interest will be disclosed as operating activities , in the C onsolidated S tatement s of C ash F lows. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Taxes [Abstract] | |
Income Taxes | 4. Income Taxes Our (provision) benefit for income taxes and the related effective income tax rates were as follows (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 (Provision) benefit for income taxes $ (89) $ 27 $ (176) $ 835 Effective tax rate 18.6% (10.5%) 16.1% (64.8%) For the three months ended September 30, 2017, the effective income tax rate differed from the U.S. statutory rate of 35% primarily due to the following benefits: · Rate differences on income (loss) of consolidated foreign companies; and · The benefit of excess foreign tax credits resulting from the inclusion of foreign earnings in U.S. income. For the nine months ended September 30, 2017, the effective income tax rate differed from the U.S. statutory rate of 35% primarily due to the following benefits: · Rate differences on income (loss) of consolidated foreign companies; · The benefit of excess foreign tax credits resulting from the inclusion of foreign earnings in U.S. income; and · Discrete tax items . For the three months ended September 30, 2016, the effective income tax benefit differed from the U.S. statutory rate of 35% primarily due to the following benefit: · Rate differences on income (loss) of consolidated foreign companies ; and · The benefit of excess foreign tax credits resulting from the inclusion of foreign earnings in U.S. income. For the nine months ended September 30, 2016, the effective income tax benefit differed from the U.S. statutory rate of 35% primarily due to the following benefits: · Rate differences on income (loss) of consolidated foreign companies, including the benefit of excess foreign tax credits resulting from the inclusion of foreign earnings in U.S. income; · The impact of equity in earnings of nonconsolidated affiliates reported in the financial statements, net of tax; and · The tax-free nature of the realignment of our equity interests in Dow Corning during the period, as well as the release of the deferred tax liability related to Corning’s tax on Dow Corning’s undistributed earnings as of the date of the transaction. Corning continues to indefinitely reinvest substantially all of its foreign earnings, with the exception of an immaterial amount of current earnings that have very low or no tax cost associated with their repatriation. O ur current analysis indicates that we have sufficient U.S. liquidity, including borrowing capacity, to fund foreseeable U.S. cash needs without requiring the repatriation of foreign cash. One time or unusual items may impact our ability or intent to keep our foreign earnings and cash indefinitely reinvested. While it remains impracticable to calculate the tax cost of repatriating our total unremitted foreign earnings, such cost could be material to the results of operations of Corning in a particular period. |
Earnings per Common Share
Earnings per Common Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings per Common Share [Abstract] | |
Earnings per Common Share | 5 . Earnings per Common Share The following table sets forth the computation of ba sic and diluted earnings per common share (in millions, except per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net income attributable to Corning Incorporated $ 390 $ 284 $ 915 $ 2,123 Less: Series A convertible preferred stock dividend 24 24 73 73 Net income available to common stockholders – basic 366 260 842 2,050 Plus: Series A convertible preferred stock dividend 24 24 73 73 Net income available to common stockholders – diluted $ 390 $ 284 $ 915 $ 2,123 Weighted-average common shares outstanding – basic 883 978 905 1,046 Effect of dilutive securities: Stock options and other dilutive securities 11 9 11 9 Series A convertible preferred stock 115 115 115 115 Weighted-average common shares outstanding – diluted 1,009 1,102 1,031 1,170 Basic earnings per common share $ 0.41 $ 0.27 $ 0.93 $ 1.96 Diluted earnings per common share $ 0.39 $ 0.26 $ 0.89 $ 1.81 Antidilutive potential shares excluded from diluted earnings per common share: Series A convertible preferred stock Employee stock options and awards 1 13 2 18 Accelerated share repurchase forward contract 14 14 Total 1 27 2 32 |
Inventories, Net of Inventory R
Inventories, Net of Inventory Reserves | 9 Months Ended |
Sep. 30, 2017 | |
Inventories, Net of Inventory Reserves [Abstract] | |
Inventories, Net of Inventory Reserves | 6. Inventories, Net of Inventory Reserves Inventories, net of inventory reserves comprise the following (in million s): September 30, December 31, 2017 2016 Finished goods $ 720 $ 606 Work in process 328 303 Raw materials and accessories 314 270 Supplies and packing materials 331 292 Total inventories, net of inventory reserves $ 1,693 $ 1,471 |
Investments
Investments | 9 Months Ended |
Sep. 30, 2017 | |
Investments [Abstract] | |
Investments | 7. Investments On May 31, 2016, Corning completed the strategic realignment of its equity investment in Dow Corning Corporation (“Dow Corning”) pursuant to the Transaction Agreement announced in December 2015. Under the terms of the Transaction Agreement, Corning exchanged with Dow Corning its 50% stock interest in Dow Corning for 100% of the stock of a newly formed entity, which holds an equity interest in Hemlock Semiconductor Group (“HSG”) and approximately $4.8 billion in cash. Prior to realignment, HSG, a wholly-owned and consolidated subsidiary of Dow Corning, was an indirect equity investment of Corning. Upon completion of the exchange, Corning now has a direct equity investment in HSG. Because our ownership percentage in HSG did not change as a result of the realignment, the investment in HSG is recorded at its carrying value, which had a negative carrying value of $383 million at the transaction date. The negative carrying value resulted from a one-time charge to this entity in 2014 for the permanent abandonment of certain assets. Excluding this charge, the entity is profitable and is expected to recover its equity in the near term. Corning’s financial statements as of June 30, 2016 include the positive impact of the release of a deferred tax liability of $105 million related to Corning’s tax on Dow Corning’s earnings that were not distributed as of the date of the transaction and a non-taxable gain of $2,676 million on the realignment. Details of the gain are illustrated below (in millions): Cash $ 4,818 Carrying Value of Dow Corning Equity Investment (1,560) Carrying Value of HSG Equity Investment (383) Other (1) (199) Gain $ 2,676 (1) Primarily consists of the release of accumulated other comprehensive loss items related to unamortized actuarial losses related to Dow Corning’s pension plan and foreign currency translation gains in the amounts of $260 million and $45 million, respectively. Investments comprise the following (in millions): Ownership September 30, December 31, interest 2017 2016 Affiliated companies accounted for by the equity method (1) 20% to 50% $ 284 $ 269 Other investments 68 67 Subtotal Investment Assets $ 352 $ 336 Affiliated companies accounted for by the equity method HSG (1)(2) 50% $ 202 $ 241 Subtotal Investment Liabilities $ 202 $ 241 (1) Amounts reflect Corning’s direct ownership interests in the respective affiliated companies at September 30, 2017 and December 31, 2016. Corning does not control any of such entities. (2) HSG indirectly holds an 80.5% interest in a HSG operating partnership. The negative carrying value of the investment in HSG is recorded in Other Liabilities. Hemlock Semiconductor Group HSG’s results of operations follow (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 (1) 2016 (2) Statement of Operations: Net sales $ 286 $ 217 $ 887 $ 397 Gross profit $ 72 $ 61 $ 180 $ 113 Net income attributable to HSG $ 59 $ 44 $ 285 $ 87 (1) HSG’s net income in the nine months ended September 30, 2017 includes pre-tax gains on settlements of long-term sales agreements in the amount of $151 million (after tax and non-controlling interests, Corning’s share was approximately $75 million). (2) Amounts reflect HSG’s results of operations for the month of June 1 , 2016 through September 30, 2016. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets | 8. Goodwill and Other Intangible Assets The carrying amount of goodwill by segment for the periods ended September 30, 2017 and December 31, 2016 is as follows (in millions): Display Optical Specialty Life All Technologies Communications Materials Sciences Other Total Balance at December 31, 2016 $ 126 $ 645 $ 150 $ 558 $ 98 $ 1,577 Acquired goodwill (1) 22 43 34 99 Measurement period adjustment (2) (28) (28) Foreign currency translation adjustment 4 7 18 7 36 Balance at September 30, 2017 $ 130 $ 674 $ 150 $ 619 $ 111 $ 1,684 (1) The Company completed two small acquisitions in the third quarter of 2017 which are being reported in the Optical Communications and Life Sciences segment and one small acquisition in the first quarter of 2017 which is reported in All Other. (2) In the second quarter of 2017, the Company recorded measurement period adjustments of $28 million related to an acquisition completed in a previous period. Corning’s gross goodwill balances for the periods ended September 30, 2017 and December 31, 2016 each were $ 8.2 billion and $8.1 billion, respectively. Accumulated impairment losses were $6.5 billion for the periods ended September 30, 2017 and December 31, 2016, and were generated primarily through goodwill impairments related to the Optical Communications segment. Other intangible assets are as follows (in millions): September 30, 2017 December 31, 2016 Accumulated Accumulated Gross amortization Net Gross amortization Net Amortized intangible assets: Patents, trademarks, and trade names $ 382 $ 192 $ 190 $ 360 $ 176 $ 184 Customer lists and other 892 191 701 761 149 612 Total $ 1,274 $ 383 $ 891 $ 1,121 $ 325 $ 796 Corning’s amortized intangible assets are primarily related to the Optical Communications and Life Sciences segments. The net carrying amount of intangible assets increased in the first nine months of 2017, primarily due to acquisitions of $132 million of other intangible assets and foreign currency translation adjustments of $16 million, offset by amortization of $ 53 million. Amortization expense related to these intangible assets is estimated to be $71 million for 2017, $74 million annually for 2018 and 2019 , and $ 70 million annually from 2020 to 2022 . |
Employee Retirement Plans
Employee Retirement Plans | 9 Months Ended |
Sep. 30, 2017 | |
Employee Retirement Plans [Abstract] | |
Employee Retirement Plans | 9. Employee Retirement Plans The following table summarizes the components of net periodic benefit cost for Corning’s defined benefit pension and postretirement health care and life insurance plans (in millions): Pension benefits Postretirement benefits Three months ended Nine months ended Three months ended Nine months ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 2017 2016 2017 2016 Service cost $ 22 $ 22 $ 69 $ 65 $ 2 $ 3 $ 7 $ 7 Interest cost 32 31 94 93 7 6 20 19 Expected return on plan assets (43) (41) (130) (124) Amortization of net loss (1) Amortization of prior service cost (credit) 1 1 4 4 (1) (1) (2) (3) Recognition of actuarial loss 26 15 60 Total pension and postretirement benefit expense $ 12 $ 39 $ 52 $ 98 $ 8 $ 8 $ 25 $ 22 The impact of the finalization of our 2016 benefit plan valuations resulted in a charge of $15 million in the nine months ended September 30, 2017. The recognition of actuarial loss of $26 million in the three months ended September 30, 2016 resulted from small settlements in several of our benefit plans which triggered plan remeasurements. In addition to the settlements occurring in the third quarter of 2016, results in the nine months ended September 30, 2016 also included the impact of the finalization of our 2015 benefit plan valuations. |
Other Liabilities
Other Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities [Abstract] | |
Other Liabilities | 10. Other Liabilities Other liabilities follow (in millions): September 30, December 31, 2017 2016 Current liabilities: Wages and employee benefits $ 513 $ 487 Income taxes 135 150 Derivative instruments 58 88 Asbestos and other litigation 39 70 Other current liabilities 510 621 Other accrued liabilities $ 1,255 $ 1,416 Non-current liabilities: Defined benefit pension plan liabilities $ 743 $ 692 Derivative instruments 343 282 Asbestos and other litigation 342 369 Investment in Hemlock Semiconductor Group (1) 202 241 Other non-current liabilities 1,310 1,221 Other liabilities $ 2,940 $ 2,805 (1) The negative carrying value resulted from a one-time charge to this entity in 2014 for the permanent abandonment of certain assets. Asbestos Claims Corning and PPG each owned 50% of the capital stock of PCC. Over a period of more than two decades, PCC and several other defendants were named in numerous lawsuits involving claims alleging personal injury from exposure to asbestos. Refer to Note 2 (Commitments, Contingencies and Guarantees) to the consolidated financial statements for additional information on the asbestos claims. |
Hedging Activities
Hedging Activities | 9 Months Ended |
Sep. 30, 2017 | |
Hedging Activities [Abstract] | |
Hedging Activities | 11. Hedging Activities Undesignated Hedges The table below includes a total gross notional value for translated earnings contracts of $ 15.2 billion and $16.7 billion at September 30, 2017 and December 31, 2016 , respectively. The translated earnings contracts include average rate forwards of $14.1 billion and $14.7 billion and zero-cost collars of $ 1.1 billion and $2.0 billion at September 30, 2017 and December 31, 2016 , respectively. The majority of the average rate forward contracts hedge a significant portion of the Company’s exposure to the Japanese yen with maturities spanning the years 2017-2022 and with gross notional values of $12. 4 billion and $13.6 billion at September 30, 2017 and December 31, 2016, respectively. The average rate forward contracts also partially hedge the impacts of the South Korean won, New Taiwan dollar, Chinese yuan, Euro and British pound translation on the Company’s projected net income. With respect to the zero-cost collars, the gross notional amount includes the value of both the put and call options. However, due to the nature of the zero-cost collars, either the put or the call option can be exercised at maturity. The total net notional value of the zero-cost collars was $0. 7 billion and $1.0 billion at September 30, 2017 and December 31, 2016 , respectively. The following tables summarize the notional amounts and respective fair values of Corning’s derivative financial instruments on a gross basis for September 30, 2017 and December 31, 2016 (in millions): Asset derivatives Liability derivatives Gross notional amount Balance Fair value Balance Fair value Sept. 30, Dec. 31, sheet Sept. 30, Dec. 31, sheet Sept. 30, Dec. 31, 2017 2016 location 2017 2016 location 2017 2016 Derivatives designated as hedging instruments Foreign exchange contracts (1) $ 381 $ 458 Other current assets $ 12 $ 1 Other accrued liabilities $ (3) $ (29) Other assets 8 Interest rate contracts 550 550 Other liabilities (5) (5) Derivatives not designated as hedging instruments Foreign exchange contracts, other 676 890 Other current assets 7 11 Other accrued liabilities (3) (7) Translated earnings contracts 15,211 16,711 Other current assets 175 423 Other accrued liabilities (52) (52) Other assets 82 146 Other liabilities (338) (277) Total derivatives $ 16,818 $ 18,609 $ 284 $ 581 $ (401) $ (370) (1) Cash flow hedges with a typical duration of 24 months or less. The following table summarizes the effect of derivative financial instruments on Corning’s consolidated financial statements for the three and nine months ended September 30, 2017 and 2016 (in millions): Effect of derivative instruments on the consolidated financial statements for the three months ended September 30, Gain recognized in other Location of gain/(loss) Gain/(loss) reclassified from comprehensive income reclassified from accumulated OCI into Derivatives in hedging (OCI) accumulated OCI into income (effective) (1) relationships 2017 2016 income (effective) 2017 2016 Sales $ 1 Foreign exchange contracts $ 3 $ 1 Cost of sales $ (1) (13) Total cash flow hedges $ 3 $ 1 $ (1) $ (12) Effect of derivative instruments on the consolidated financial statements for the nine months ended September 30, Gain (loss) recognized in Location of gain/(loss) Gain/(loss) reclassified from other comprehensive income reclassified from accumulated OCI into Derivatives in hedging (OCI) accumulated OCI into income ineffective/effective (1) relationships 2017 2016 income (effective) 2017 2016 Sales $ 1 $ 2 Cost of sales (11) (27) Foreign exchange contracts $ 36 $ (63) Other expense, net (1) (1) Total cash flow hedges $ 36 $ (63) $ (11) $ (26) (1) The amount of hedge ineffectiveness at September 30, 2017 and 2016 was insignificant. The following table summarizes the effect on the consolidated financial statements relating to Corning’s derivative financial instruments (in millions): Gain (loss) recognized in income Three months ended Nine months ended Location of gain/(loss) September 30, September 30, Undesignated derivatives recognized in income 2017 2016 2017 2016 Foreign exchange contracts – balance sheet and loans Other expense, net $ (7) $ (4) $ (19) $ (78) Foreign currency hedges related to translated earnings Translated earnings contract gain (loss), net 26 (237) (193) (2,295) Total undesignated $ 19 $ (241) $ (212) $ (2,373) |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | 12. Fair Value Measurements Fair value standards under U.S. GAAP define fair value, establish a framework for measuring fair value in applying generally accepted accounting principles, and require disclosures about fair value measurements. The standards also identify two kinds of inputs that are used to determine the fair value of assets and liabilities: observable and unobservable. Observable inputs are based on market data or independent sources while unobservable inputs are based on the Company’s own market assumptions. Once inputs have been characterized, the inputs are prioritized into one of three broad levels (provided in the table below) used to measure fair value. Fair value standards apply whenever an entity is measuring fair value under other accounting pronouncements that require or permit fair value measurement and require the use of observable market data when available. The following tables provide fair value measurement information for the Company’s major categories of financial assets and liabilities measured on a recurring basis (in millions): Fair value measurements at reporting date using Quoted prices in Significant other Significant active markets for observable unobservable September 30, identical assets inputs inputs 2017 (Level 1) (Level 2) (Level 3) Current assets: Other current assets (1)(2) $ 488 $ 194 $ 294 Non-current assets: Other assets (1) $ 90 $ 90 Current liabilities: Other accrued liabilities (1)(3) $ 63 $ 58 $ 5 Non-current liabilities: Other liabilities (1)(3) $ 363 $ 343 $ 20 (1) Derivative assets and liabilities include foreign exchange contracts which are measured using observable quoted prices for similar assets and liabilities. (2) Other assets include a contingent consideration asset which was measured by applying an option pricing model using projected future Corning Precision Materials’ revenues. (3) Other accrued liabilities and other liabilities include contingent consideration that was measured using unobservable (Level 3) inputs. As of September 30, 2017 the fair value of the contingent consideration payables is $25 million. Fair value measurements at reporting date using Quoted prices in Significant other Significant active markets for observable unobservable December 31, identical assets inputs inputs 2016 (Level 1) (Level 2) (Level 3) Current assets: Other current assets (1) $ 435 $ 435 Non-current assets: Other assets (1)(2) $ 464 $ 175 $ 289 Current liabilities: Other accrued liabilities (1) $ 88 $ 88 Non-current liabilities: Other liabilities (1) $ 282 $ 282 (1) Derivative assets and liabilities include foreign exchange contracts which are measured using observable quoted prices for similar assets and liabilities. (2) Other assets include asset-backed securities which are measured using observable quoted prices for similar assets and a contingent consideration asset which was measured by applying an option pricing model using projected future Corning Precision Materials’ revenues. As a result of the acquisition of Samsung Corning Precision Materials in January 2014, the Company has contingent consideration that was measured using unobservable (Level 3) inputs. Changes in the fair value of the contingent consideration in future periods are valued using an option pricing model and are recorded in Corning’s results in the period of the change. As of September 30, 2017 and December 31, 2016 , the fair value of the potential receipt of the contingent consideration in 2018 was $294 million and $2 89 million, respectively. There were no significant financial assets and liabilities measured on a nonrecurring basis as of September 30, 2017 and December 31, 2016. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Shareholders' Equity [Abstract] | |
Shareholders' Equity | 13. Shareholders’ Equity Fixed Rate Cumulative Convertible Preferred Stock, Series A Corning has 2,300 outstanding shares of Fixed Rate Cumulative Convertible Preferred Stock, Series A. The Preferred Stock is convertible at the option of the holder and the Company upon certain events, at a conversion rate of 50,000 shares of Corning’s common stock per one share of Preferred Stock, subject to certain anti-dilution provisions. As of September 30, 2017, the Preferred Stock has not been converted, and none of the anti-dilution provisions have been triggered. Share Repurchases 2016 Share Repurchases In July 2016, Corning entered into an accelerated share repurchase agreement (the “2016 ASR agreement”) under the 2015 Repurchase Program to repurchase Corning’s common stock. Under the 2016 ASR agreement, Corning paid $2.0 billion for a total of 86.7 million shares. In addition to the 2016 ASR agreement, during the year ended December 31, 2016, the Company repurchased 110.4 million shares of common stock on the open market for approximately $2.2 billion as part of its 2015 Repurchase Programs, resulting in a total of 197.1 million shares repurchased for $4.2 billion during 2016. 2017 Share Repurchases In December 2016, Corning’s Board of Directors approved a $4 billion share repurchase program with no expiration (the “2016 Repurchase Program”). In the nine months ended September 30, 2017, Corning entered into two separate accelerated share repurchase agreements under this program (the “2017 ASR agreements”). In the second quarter of 2017, Corning entered into and finalized an accelerated share repurchase agreement under which we paid $500 million for a total of 17.1 million shares. In the third quarter of 2017, Corning entered into and finalized an additional accelerated share repurchase agreement under which we paid $500 million for a total of 17.2 million shares. In addition to the 2017 ASR agreements, during the three and nine months ended September 30, 2017, the Company repurchased 17.2 million and 37.6 million shares of common stock on the open market for approximately $507.7 million and $1.1 billion, respectively. Accumulated Other Comprehensive Loss In the three and nine months ended September 30, 2017 and 2016 , the primary changes in accumulated other comprehensive loss were related to the foreign currency translation adjustment and unamortized actuarial gains (losses) for postretirement benefit plan components. A summary of changes in the foreign currency translation adjustment component of accumulated other comprehensive loss is as follows (in millions) (1) : Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Beginning balance $ (871) $ (547) $ (1,275) $ (1,171) Other comprehensive income (2) 49 235 435 860 Equity method affiliates (3) 4 10 22 9 Net current-period other comprehensive income 53 245 457 869 Ending balance $ (818) $ (302) $ (818) $ (302) (1) All amounts are after tax. Amounts in parentheses indicate debits to accumulated other comprehensive loss . (2) For the three months e nded September 30, 2017 , tax amounts are not significant. For the nine months ended September 30, 2017, am ounts are net of total tax expense of $ 47 million . F or the three and nine months ended September 30, 2016, amounts are net of total tax expense of $32 million and $51 million, respectively. (3) Tax effects are not significant. In the second quarter of 2016, a $45 million cumulative foreign currency translation gain was released as a result of the realignment of Dow Corning and included in the gain on realignment of equity investment. In the second quarter of 2016, a $22 million cumulative foreign currency translation loss was released as a result of the contribution of our investment in PCE to the PCC litigation trust and included in selling, general and administrative expenses. A summary of changes in the unamortized actuarial gains (losses) for postretirement benefit plan component of accumulated other comprehensive loss is as follows (in millions) (1): Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Beginning balance $ (330) $ (323) $ (347) $ (588) Other comprehensive loss before reclassifications (2) (31) (64) Amounts reclassified from accumulated other comprehensive income (2) 26 17 60 Equity method affiliates (3) 264 Net current-period other comprehensive (loss) income (5) 17 260 Ending balance $ (330) $ (328) $ (330) $ (328) (1) All amounts are after tax. Amounts in parentheses indicate debits to accumulated other comprehensive loss . (2) For the three months ended September 30, 2017, tax effects are not significant . For the nine months ended September 30, 2017, amounts are net of total tax expense of $10 million. For the three and nine months ended September 30, 2016, amounts are net of total tax benefit of ( $3 ) million and ( $4 ) million, respectively. (3) For the three and nine months ended September 30, 2017, tax effects are not significant. For the three and nine months ended September 30, 2016, tax effects are not significant and are net of total tax expense and $19 million, respectively. In the second quarter of 2016, a $260 million cumulative unamortized actuarial loss, net of tax of $19 million, was released as a result of the realignment of Dow Corning and included in the gain on realignment of equity investment. In addition, for the nine months ended September 30, 2017, in the investment component of accumulated other comprehensive loss , a cumulative loss of $14 million, mainly comprising income tax, was reclassified to the income statement. |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Share-based Compensation [Abstract] | |
Share-based Compensation | 14. Share-based Compensation Stock Compensation Plans The Company measures and recognizes compensation cost for all share-based payment awards made to employees and directors based on estimated fair values. Fair values for stock options were estimated using a multiple-point Black-Scholes valuation model. Share-based compensation cost for employee stock options and time-based restricted stock and restricted stock units was approximately $10 million for the three months ended September 30, 2017 and 2016, respectively, and approximately $35 million and $ 33 million for the nine months ended September 30, 2017 and 2016, respectively. The income tax (expense) benefit from share-based compensation was not significant for the three and nine months ended September 30, 2017 and 2016. Stock Options Corning’s stock option plans provide non-qualified and incentive stock options to purchase authorized but unissued shares, or treasury shares, at the market price on the grant date and generally become exercisable three years from the grant date. The maximum term of non-qualified and incentive stock options is ten years from the grant date. The following table summarizes information concerning stock options outstanding including the related transactions under the stock option plans for the nine months ended September 30, 2017 : Weighted- Average Weighted- Remaining Aggregate Number Average Contractual Intrinsic of Shares Exercise Term in Value (in thousands) Price Years (in thousands) Options Outstanding as of December 31, 2016 31,507 $ 19.40 Granted 1,505 27.01 Exercised (12,915) 21.26 Forfeited and Expired (254) 23.21 Options Outstanding as of September 30, 2017 19,843 18.72 4.66 $ 222,313 Options Expected to Vest as of September 30, 2017 19,801 18.71 4.65 222,056 Options Exercisable as of September 30, 2017 15,173 17.47 3.47 188,890 The aggregate intrinsic value (market value of stock less option exercise price) in the preceding table represents the total pretax intrinsic value, based on the Company’s closing stock price on September 30, 2017 , which would have been received by the option holders had all option holders exercised their “in-the-money” options as of that date. As of September 30, 2017 , there was approximately $8 million of unrecognized compensation cost related to stock options granted under the plans. The cost is expected to be recognized over a weighted-average period of 2 years. Compensation cost related to stock options was approximately $1 million and $2 million for the three months ended September 30, 2017 and 2016 , respectively, and approximately $11 million and $10 million for the nine months ended September 30, 2017 and 2016, respectively. Proceeds received from the exercise of stock options were $275 million and $ 86 million for the nine months ended September 30, 2017 and 2016 , respectively. Proceeds received from the exercise of stock options were included in financing activities on the Company’s Consolidated Statements of Cash Flows. The total intrinsic value of options exercised for the nine months ended September 30, 2017 and 2016 was approximately $ 83 m illion and $3 6 million, respectively. The following inputs were used for the valuation of option grants under our stock option plans: Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Expected volatility 34.2% 38.6% 34.2 - 36.1% 38.6 - 43.1% Weighted-average volatility 34.2% 38.6% 34.2 - 36.1% 38.6 - 43.1% Expected dividends 2.18% 2.34% 2.11 - 2.28% 2.34 - 2.94% Risk-free rate 2.1% 1.4% 2.1 - 2.3% 1.4 - 1.6% Average risk-free rate 2.1% 1.4% 2.1 - 2.3% 1.4 - 1.6% Expected term (in years) 7.4 7.4 7.4 - 7.4 7.4 - 7.4 Pre-vesting departure rate 0.6% 0.6% 0.6 - 0.6% 0.6 - 0.6% Expected volatility is based on a blended approach defined as the weighted average of the short-term implied volatility, the most recent volatility for the period equal to the expected term, and the most recent 15 -year historical volatility. The expected term assumption is the period of time the options are expected to be outstanding, and is calculated using a combination of historical exercise experience adjusted to reflect the current vesting period of options being valued, and partial life cycles of outstanding options. The risk-free rate assumption is the implied rate for a zero-coupon U.S. Treasury bond with a term equal to the option’s expected term. Incentive Stock Plans Corning’s incentive stock plan permits restricted stock and restricted stock unit grants, either determined by specific performance goals or issued directly, in most instances, subject to the possibility of forfeiture and without cash consideration. Restricted stock and restricted stock units under the incentive stock plan are granted at the closing market price on the grant date, contingently vest over a period of generally three years. The fair value of each restricted stock grant or restricted stock unit awarded under the Incentive Stock Plan is based on the grant date closing price of the Company’s stock. Time-Based Restricted Stock and Restricted Stock Units: Time-based restricted stock and restricted stock units are issued by the Company on a discretionary basis, and are payable in shares of the Company’s common stock upon vesting. The fair value is based on the closing market price of the Company’s stock on the grant date. Compensation cost is recognized over the requisite vesting period and adjusted for actual forfeitures before vesting. The following table represents a summary of the status of the Company’s non-vested time-based restricted stock and restricted stock units as of December 31, 2016 , and changes which occurred during the nine months ended September 30, 2017 : Weighted Average Shares Grant-Date (000’s) Fair Value Non-vested shares and share units at December 31, 2016 4,640 $ 20.15 Granted 1,576 27.67 Vested (1,243) 20.65 Forfeited (88) 22.13 Non-vested shares and share units at September 30, 2017 4,885 $ 22.42 As of September 30, 2017 , there was approximately $ 51 million of unrecognized compensation cost related to non-vested time-based restricted stock and restricted stock units compensation arrangements granted under the Plan. The cost is expected to be recognized over a weighted-average period of 2.5 years. Compensation cost related to time-based restricted stock and restricted stock units was approximately $9 million and $8 million for the three months ended September 30, 2017 and 2016 , respectively, and approximately $24 million and $23 million for the nine months ended September 30, 2017 and 2016, respectively . |
Reportable Segments
Reportable Segments | 9 Months Ended |
Sep. 30, 2017 | |
Reportable Segments [Abstract] | |
Reportable Segments | 15. Reportable Segments Our reportable segments are as follows: · Display Technologies – manufactures glass substrates primarily for flat panel liquid crystal displays. · Optical Communications – manufactures carrier and enterprise network components for the telecommunications industry. · Environmental Technologies – manufactures ceramic substrates and filters for automotive and diesel applications. · Specialty Materials – manufactures products that provide more than 150 material formulations for glass, glass ceramics and fluoride crystals to meet demand for unique customer needs. · Life Sciences – manufactures glass and plastic labware, equipment, media and reagents enabling workflow solutions for scientific applications. All other segments that do not meet the quantitative threshold for separate reporting have been grouped as “All Other.” This group is primarily compris ed of the results of the p harmaceutical t echnologies business and new product lines and development projects, as well as certain corporate investments such as Eurokera and Keraglass equity affiliates. We prepared the financial results for our reportable segments on a basis that is consistent with the manner in which we internally disaggregate financial information to assist in making internal operating decisions. We included the earnings of equity affiliates that are closely associated with our reportable segments in the respective segment’s net income. We have allocated certain common expenses among reportable segments differently than we would for stand-alone financial information. Segment net income may not be consistent with measures used by other companies. The accounting policies of our reportable segments are the same as those applied in the Consolidated Financial Statements. Reportable Segments (in millions) Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Three months ended September 30, 2017 Net sales $ 768 $ 917 $ 277 $ 373 $ 223 $ 49 $ 2,607 Depreciation (1) $ 134 $ 49 $ 31 $ 34 $ 14 $ 12 $ 274 Amortization of purchased intangibles $ 11 $ 6 $ 1 $ 18 Research, development and engineering expenses (2) $ 21 $ 44 $ 28 $ 37 $ 5 $ 52 $ 187 Income tax (provision) benefit $ (82) $ (52) $ (17) $ (36) $ (8) $ 28 $ (167) Net income (loss) (3) $ 203 $ 102 $ 34 $ 72 $ 17 $ (55) $ 373 Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Three months ended September 30, 2016 Net sales $ 902 $ 795 $ 264 $ 295 $ 214 $ 37 $ 2,507 Depreciation (1) $ 152 $ 41 $ 32 $ 26 $ 14 $ 12 $ 277 Amortization of purchased intangibles $ 10 $ 5 $ 2 $ 17 Research, development and engineering expenses (2) $ 14 $ 37 $ 24 $ 31 $ 6 $ 47 $ 159 Income tax (provision) benefit $ (98) $ (49) $ (17) $ (21) $ (8) $ 21 $ (172) Net income (loss) (3) $ 279 $ 84 $ 35 $ 42 $ 16 $ (47) $ 409 Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Nine Months Ended September 30, 2017 Net sales $ 2,252 $ 2,617 $ 815 $ 1,010 $ 654 $ 131 $ 7,479 Depreciation (1) $ 393 $ 142 $ 93 $ 94 $ 39 $ 34 $ 795 Amortization of purchased intangibles $ 33 $ 16 $ 4 $ 53 Research, development and engineering expenses (2) $ 63 $ 121 $ 80 $ 110 $ 17 $ 156 $ 547 Income tax (provision) benefit $ (270) $ (149) $ (47) $ (88) $ (23) $ 83 $ (494) Net income (loss) (3) $ 663 $ 285 $ 97 $ 176 $ 48 $ (166) $ 1,103 Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Nine Months Ended September 30, 2016 Net sales $ 2,408 $ 2,186 $ 787 $ 788 $ 633 $ 112 $ 6,914 Depreciation (1) $ 452 $ 125 $ 97 $ 81 $ 42 $ 34 $ 831 Amortization of purchased intangibles $ 25 $ 15 $ 6 $ 46 Research, development and engineering expenses (2) $ 49 $ 110 $ 75 $ 96 $ 18 $ 139 $ 487 Income tax (provision) benefit $ (277) $ (99) $ (52) $ (52) $ (22) $ 87 $ (415) Net income (loss) (3) $ 692 $ 178 $ 106 $ 106 $ 45 $ (187) $ 940 (1) Depreciation expense for Corning’s reportable segments includes an allocation of depreciation of corporate property not specifically identifiable to a segment . (2) Research , development and engineering expenses include direct project spending that is identifiable to a segment. (3) Many of Corning’s administrative and staff functions are performed on a centralized basis. Where practicable, Corning charges these expenses to segments based upon the extent to which each business uses a centralized function. Other staff functions , such as corporate finance, human resources and legal, are allocated to segments, primarily as a percentage of sales. Expenses that are not allocated to the segments are included in the reconciliation of reportable net segment net income to consolidated net income below. A reconciliation of reportable segment net income to consolidated net income follows (in millions): Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Net income of reportable segments $ 428 $ 456 $ 1,269 $ 1,127 Net loss of All Other (55) (47) (166) (187) Unallocated amounts: Net financing costs (1) (27) (26) (79) (84) Stock-based compensation expense (10) (10) (35) (33) Exploratory research (24) (27) (71) (82) Corporate contributions (7) (15) (29) (38) Gain on realignment of equity investment 2,676 Equity in earnings of affiliated companies (2) 30 22 140 126 Unrealized loss on foreign currency hedges related to translated earnings (24) (239) (392) (2,441) Resolution of Department of Justice investigation (98) Income tax benefit 66 193 299 1,247 Other corporate items 13 (23) (21) (90) Net income $ 390 $ 284 $ 915 $ 2,123 (1) Net financing costs include interest income, interest expense, and interest costs and investment gains and losses associated with benefit plans. (2) For the periods ending September 30, 2017, and the three months ending September 30, 2016, the amounts represent the equity earnings of HSG. Through May 31, 2016, the date of the strategic realignment of our equity interest in Dow Corning, this amount primarily represents the equity earnings from Dow Corning. Refer to Note 7, Investments, for additional information. |
Significant Accounting Polici22
Significant Accounting Policies (Policy) | 9 Months Ended |
Sep. 30, 2017 | |
Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In these notes, the terms “Corning,” “Company,” “we,” “us,” or “our” mean Corning Incorporated and its subsidiary companies. The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial information. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been omitted or condensed. These interim consolidated financial statements should be read in conjunction with Corning’s consolidated financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2016 (“ 2016 Form 10-K”). The unaudited consolidated financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results of operations, financial position and cash flows for the interim periods presented. All such adjustments are of a normal recurring nature. The results for interim periods are not necessarily indicative of results which may be expected for any other interim period or for the full year. On January 1, 2017, Corning adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, the impacts of which include the recording of cumulative tax benefits of $233 million in beginning retained earnings and cash flow reclassifications that were not significant. Certain prior year amounts have been reclassified to conform to the current-year presentation. These reclassifications had no impact on our results of operations, financial position, or changes in shareholders’ equity. |
New Accounting Standards | New Accounting Standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, as a new Topic, Accounting Standards Codification (“ASC”) Topic 606. The new revenue recognition standard relates to revenue from contracts with customers, which, along with amendments issued in 2015 and 2016, will supersede nearly all current U.S. GAAP guidance on this topic and eliminate industry-specific guidance. The underlying principle is to use a five-step analysis of transactions to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Corning has evaluated its material contracts, and has concluded that the impact of adopting the standard on its financial statements and related disclosure will not be material. The standard, as amended, will be effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. We will adopt the standard on a modified retrospective basis in 2018. Corning’s equity affiliates are currently evaluating their material contracts, and have not concluded on the potential impact of adopting ASU 2014-09 on their financial statements and related disclosure. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes all existing guidance on accounting for leases in ASC Topic 840. ASU 2016-02 is intended to provide enhanced transparency and comparability by requiring lessees to record right-of-use assets and corresponding lease liabilities on the balance sheet. ASU 2016-02 will continue to classify leases as either finance or operating, with classification affecting the pattern of expense recognition in the statement of income. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. ASU 2016-02 is required to be applied with a modified retrospective approach to each prior reporting period presented with various optional practical expedients. We are currently assessing the potential impact of adopting ASU 2016-02 on our financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 refines how companies classify certain aspects of the cash flow statement in regards to debt prepayment, settlement of debt instruments, contingent consideration payments, proceeds from insurance claims and life insurance policies, distribution from equity method investees, beneficial interests in securitization transactions and separately identifiable cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, and for interim periods within those fiscal years. We are currently assessing the potential impact of adopting ASU 2016-15 on our financial statements and related disclosures, but the effect is not expected to be material. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which reduces the complexity in the accounting standards by allowing the recognition of current and deferred income taxes for an intra-entity asset transfer, other than inventory, when the transfer occurs. Historically, recognition of the income tax consequence was not recognized until the asset was sold to an outside party. This amendment should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. ASU 2016-16 is effective for annual periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities as of the beginning of an annual reporting period for which financial statements (interim or annual) have not been issued or made available for issuance. That is, earlier adoption should be in the first interim period if an entity issues interim financial statements. We are currently evaluating the impact of ASU 2016-16 on our consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350). ASU 2017-04 simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual, or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopt ed the ASU on January 1, 2017. In March 2017, the FASB issued ASU No. 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 requires entities to (1) disaggregate the current-service-cost component from the other components of net benefit cost (the “other components”) and present it with other current compensation costs for related employees in the income statement and (2) present the other components elsewhere in the income statement and outside of income from operations if that subtotal is presented. In addition, the ASU requires entities to disclose the income statement lines that contain the other components if they are not presented on appropriately described separate lines. The amendment should be applied retrospectively for the presentation of the service cost component and prospectively for the capitalization of the service cost component. ASU 2017-07 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted at the beginning of any annual period for which an entity’s financial statements have not been issued or made available for issuance. We are currently evaluating the impact of ASU 2017-07 on our consolidated financial statements and related disclosures , but the impact is not expected to be material . |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Income Taxes [Abstract] | |
Provision for Income Taxes | Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 (Provision) benefit for income taxes $ (89) $ 27 $ (176) $ 835 Effective tax rate 18.6% (10.5%) 16.1% (64.8%) |
Earnings per Common Share (Tabl
Earnings per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings per Common Share [Abstract] | |
Computation of Basic and Diluted Earnings per Common Share | Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net income attributable to Corning Incorporated $ 390 $ 284 $ 915 $ 2,123 Less: Series A convertible preferred stock dividend 24 24 73 73 Net income available to common stockholders – basic 366 260 842 2,050 Plus: Series A convertible preferred stock dividend 24 24 73 73 Net income available to common stockholders – diluted $ 390 $ 284 $ 915 $ 2,123 Weighted-average common shares outstanding – basic 883 978 905 1,046 Effect of dilutive securities: Stock options and other dilutive securities 11 9 11 9 Series A convertible preferred stock 115 115 115 115 Weighted-average common shares outstanding – diluted 1,009 1,102 1,031 1,170 Basic earnings per common share $ 0.41 $ 0.27 $ 0.93 $ 1.96 Diluted earnings per common share $ 0.39 $ 0.26 $ 0.89 $ 1.81 Antidilutive potential shares excluded from diluted earnings per common share: Series A convertible preferred stock Employee stock options and awards 1 13 2 18 Accelerated share repurchase forward contract 14 14 Total 1 27 2 32 |
Inventories, Net of Inventory25
Inventories, Net of Inventory Reserves (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventories, Net of Inventory Reserves [Abstract] | |
Inventories, Net | September 30, December 31, 2017 2016 Finished goods $ 720 $ 606 Work in process 328 303 Raw materials and accessories 314 270 Supplies and packing materials 331 292 Total inventories, net of inventory reserves $ 1,693 $ 1,471 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Investments [Abstract] | |
Gain of Realignment | Cash $ 4,818 Carrying Value of Dow Corning Equity Investment (1,560) Carrying Value of HSG Equity Investment (383) Other (1) (199) Gain $ 2,676 (1) Primarily consists of the release of accumulated other comprehensive loss items related to unamortized actuarial losses related to Dow Corning’s pension plan and foreign currency translation gains in the amounts of $260 million and $45 million, respectively. |
Investments | Ownership September 30, December 31, interest 2017 2016 Affiliated companies accounted for by the equity method (1) 20% to 50% $ 284 $ 269 Other investments 68 67 Subtotal Investment Assets $ 352 $ 336 Affiliated companies accounted for by the equity method HSG (1)(2) 50% $ 202 $ 241 Subtotal Investment Liabilities $ 202 $ 241 (1) Amounts reflect Corning’s direct ownership interests in the respective affiliated companies at September 30, 2017 and December 31, 2016. Corning does not control any of such entities. (2) HSG indirectly holds an 80.5% interest in a HSG operating partnership. The negative carrying value of the investment in HSG is recorded in Other Liabilities. |
Results From Operations | Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 (1) 2016 (2) Statement of Operations: Net sales $ 286 $ 217 $ 887 $ 397 Gross profit $ 72 $ 61 $ 180 $ 113 Net income attributable to HSG $ 59 $ 44 $ 285 $ 87 (1) HSG’s net income in the nine months ended September 30, 2017 includes pre-tax gains on settlements of long-term sales agreements in the amount of $151 million (after tax and non-controlling interests, Corning’s share was approximately $75 million). (2) Amounts reflect HSG’s results of operations for the month of June 1 , 2016 through September 30, 2016. |
Goodwill and Other Intangible27
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Other Intangible Assets [Abstract] | |
Carrying Amount of Goodwill by Segment | Display Optical Specialty Life All Technologies Communications Materials Sciences Other Total Balance at December 31, 2016 $ 126 $ 645 $ 150 $ 558 $ 98 $ 1,577 Acquired goodwill (1) 22 43 34 99 Measurement period adjustment (2) (28) (28) Foreign currency translation adjustment 4 7 18 7 36 Balance at September 30, 2017 $ 130 $ 674 $ 150 $ 619 $ 111 $ 1,684 (1) The Company completed two small acquisitions in the third quarter of 2017 which are being reported in the Optical Communications and Life Sciences segment and one small acquisition in the first quarter of 2017 which is reported in All Other. (2) In the second quarter of 2017, the Company recorded measurement period adjustments of $28 million related to an acquisition completed in a previous period. |
Other Intangible Assets | September 30, 2017 December 31, 2016 Accumulated Accumulated Gross amortization Net Gross amortization Net Amortized intangible assets: Patents, trademarks, and trade names $ 382 $ 192 $ 190 $ 360 $ 176 $ 184 Customer lists and other 892 191 701 761 149 612 Total $ 1,274 $ 383 $ 891 $ 1,121 $ 325 $ 796 |
Employee Retirement Plans (Tabl
Employee Retirement Plans (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Employee Retirement Plans [Abstract] | |
Net Periodic Benefit Expense | Pension benefits Postretirement benefits Three months ended Nine months ended Three months ended Nine months ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 2017 2016 2017 2016 Service cost $ 22 $ 22 $ 69 $ 65 $ 2 $ 3 $ 7 $ 7 Interest cost 32 31 94 93 7 6 20 19 Expected return on plan assets (43) (41) (130) (124) Amortization of net loss (1) Amortization of prior service cost (credit) 1 1 4 4 (1) (1) (2) (3) Recognition of actuarial loss 26 15 60 Total pension and postretirement benefit expense $ 12 $ 39 $ 52 $ 98 $ 8 $ 8 $ 25 $ 22 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities [Abstract] | |
Other Liabilities | September 30, December 31, 2017 2016 Current liabilities: Wages and employee benefits $ 513 $ 487 Income taxes 135 150 Derivative instruments 58 88 Asbestos and other litigation 39 70 Other current liabilities 510 621 Other accrued liabilities $ 1,255 $ 1,416 Non-current liabilities: Defined benefit pension plan liabilities $ 743 $ 692 Derivative instruments 343 282 Asbestos and other litigation 342 369 Investment in Hemlock Semiconductor Group (1) 202 241 Other non-current liabilities 1,310 1,221 Other liabilities $ 2,940 $ 2,805 (1) The negative carrying value resulted from a one-time charge to this entity in 2014 for the permanent abandonment of certain assets. |
Hedging Activities (Tables)
Hedging Activities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Summary of Notional Amounts and Respective Fair Values of Derivative Financial Instruments | Asset derivatives Liability derivatives Gross notional amount Balance Fair value Balance Fair value Sept. 30, Dec. 31, sheet Sept. 30, Dec. 31, sheet Sept. 30, Dec. 31, 2017 2016 location 2017 2016 location 2017 2016 Derivatives designated as hedging instruments Foreign exchange contracts (1) $ 381 $ 458 Other current assets $ 12 $ 1 Other accrued liabilities $ (3) $ (29) Other assets 8 Interest rate contracts 550 550 Other liabilities (5) (5) Derivatives not designated as hedging instruments Foreign exchange contracts, other 676 890 Other current assets 7 11 Other accrued liabilities (3) (7) Translated earnings contracts 15,211 16,711 Other current assets 175 423 Other accrued liabilities (52) (52) Other assets 82 146 Other liabilities (338) (277) Total derivatives $ 16,818 $ 18,609 $ 284 $ 581 $ (401) $ (370) (1) Cash flow hedges with a typical duration of 24 months or less. |
Designated as Hedging Instrument [Member] | |
Effect on Consolidated Financial Statements | Effect of derivative instruments on the consolidated financial statements for the three months ended September 30, Gain recognized in other Location of gain/(loss) Gain/(loss) reclassified from comprehensive income reclassified from accumulated OCI into Derivatives in hedging (OCI) accumulated OCI into income (effective) (1) relationships 2017 2016 income (effective) 2017 2016 Sales $ 1 Foreign exchange contracts $ 3 $ 1 Cost of sales $ (1) (13) Total cash flow hedges $ 3 $ 1 $ (1) $ (12) Effect of derivative instruments on the consolidated financial statements for the nine months ended September 30, Gain (loss) recognized in Location of gain/(loss) Gain/(loss) reclassified from other comprehensive income reclassified from accumulated OCI into Derivatives in hedging (OCI) accumulated OCI into income ineffective/effective (1) relationships 2017 2016 income (effective) 2017 2016 Sales $ 1 $ 2 Cost of sales (11) (27) Foreign exchange contracts $ 36 $ (63) Other expense, net (1) (1) Total cash flow hedges $ 36 $ (63) $ (11) $ (26) (1) The amount of hedge ineffectiveness at September 30, 2017 and 2016 was insignificant. |
Not Designated as Hedging Instrument [Member] | |
Effect on Consolidated Financial Statements | Gain (loss) recognized in income Three months ended Nine months ended Location of gain/(loss) September 30, September 30, Undesignated derivatives recognized in income 2017 2016 2017 2016 Foreign exchange contracts – balance sheet and loans Other expense, net $ (7) $ (4) $ (19) $ (78) Foreign currency hedges related to translated earnings Translated earnings contract gain (loss), net 26 (237) (193) (2,295) Total undesignated $ 19 $ (241) $ (212) $ (2,373) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Measurements [Abstract] | |
Major Categories of Financial Assets and Liabilities Measured on a Recurring Basis | Fair value measurements at reporting date using Quoted prices in Significant other Significant active markets for observable unobservable September 30, identical assets inputs inputs 2017 (Level 1) (Level 2) (Level 3) Current assets: Other current assets (1)(2) $ 488 $ 194 $ 294 Non-current assets: Other assets (1) $ 90 $ 90 Current liabilities: Other accrued liabilities (1)(3) $ 63 $ 58 $ 5 Non-current liabilities: Other liabilities (1)(3) $ 363 $ 343 $ 20 (1) Derivative assets and liabilities include foreign exchange contracts which are measured using observable quoted prices for similar assets and liabilities. (2) Other assets include a contingent consideration asset which was measured by applying an option pricing model using projected future Corning Precision Materials’ revenues. (3) Other accrued liabilities and other liabilities include contingent consideration that was measured using unobservable (Level 3) inputs. As of September 30, 2017 the fair value of the contingent consideration payables is $25 million. Fair value measurements at reporting date using Quoted prices in Significant other Significant active markets for observable unobservable December 31, identical assets inputs inputs 2016 (Level 1) (Level 2) (Level 3) Current assets: Other current assets (1) $ 435 $ 435 Non-current assets: Other assets (1)(2) $ 464 $ 175 $ 289 Current liabilities: Other accrued liabilities (1) $ 88 $ 88 Non-current liabilities: Other liabilities (1) $ 282 $ 282 (1) Derivative assets and liabilities include foreign exchange contracts which are measured using observable quoted prices for similar assets and liabilities. (2) Other assets include asset-backed securities which are measured using observable quoted prices for similar assets and a contingent consideration asset which was measured by applying an option pricing model using projected future Corning Precision Materials’ revenues. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |
Accumulated Other Comprehensive Income (Loss) | Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Beginning balance $ (871) $ (547) $ (1,275) $ (1,171) Other comprehensive income (2) 49 235 435 860 Equity method affiliates (3) 4 10 22 9 Net current-period other comprehensive income 53 245 457 869 Ending balance $ (818) $ (302) $ (818) $ (302) (1) All amounts are after tax. Amounts in parentheses indicate debits to accumulated other comprehensive loss . (2) For the three months e nded September 30, 2017 , tax amounts are not significant. For the nine months ended September 30, 2017, am ounts are net of total tax expense of $ 47 million . F or the three and nine months ended September 30, 2016, amounts are net of total tax expense of $32 million and $51 million, respectively. (3) Tax effects are not significant. |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | |
Accumulated Other Comprehensive Income (Loss) | Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Beginning balance $ (330) $ (323) $ (347) $ (588) Other comprehensive loss before reclassifications (2) (31) (64) Amounts reclassified from accumulated other comprehensive income (2) 26 17 60 Equity method affiliates (3) 264 Net current-period other comprehensive (loss) income (5) 17 260 Ending balance $ (330) $ (328) $ (330) $ (328) (1) All amounts are after tax. Amounts in parentheses indicate debits to accumulated other comprehensive loss . (2) For the three months ended September 30, 2017, tax effects are not significant . For the nine months ended September 30, 2017, amounts are net of total tax expense of $10 million. For the three and nine months ended September 30, 2016, amounts are net of total tax benefit of ( $3 ) million and ( $4 ) million, respectively. (3) For the three and nine months ended September 30, 2017, tax effects are not significant. For the three and nine months ended September 30, 2016, tax effects are not significant and are net of total tax expense and $19 million, respectively. |
Share-based Compensation (Table
Share-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Share-based Compensation [Abstract] | |
Summary of Information Concerning Stock Options Outstanding Including the Related Transactions under the Stock Option Plans | Weighted- Average Weighted- Remaining Aggregate Number Average Contractual Intrinsic of Shares Exercise Term in Value (in thousands) Price Years (in thousands) Options Outstanding as of December 31, 2016 31,507 $ 19.40 Granted 1,505 27.01 Exercised (12,915) 21.26 Forfeited and Expired (254) 23.21 Options Outstanding as of September 30, 2017 19,843 18.72 4.66 $ 222,313 Options Expected to Vest as of September 30, 2017 19,801 18.71 4.65 222,056 Options Exercisable as of September 30, 2017 15,173 17.47 3.47 188,890 |
Inputs Used for Valuation of Option Grants under Stock Option Plans | Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Expected volatility 34.2% 38.6% 34.2 - 36.1% 38.6 - 43.1% Weighted-average volatility 34.2% 38.6% 34.2 - 36.1% 38.6 - 43.1% Expected dividends 2.18% 2.34% 2.11 - 2.28% 2.34 - 2.94% Risk-free rate 2.1% 1.4% 2.1 - 2.3% 1.4 - 1.6% Average risk-free rate 2.1% 1.4% 2.1 - 2.3% 1.4 - 1.6% Expected term (in years) 7.4 7.4 7.4 - 7.4 7.4 - 7.4 Pre-vesting departure rate 0.6% 0.6% 0.6 - 0.6% 0.6 - 0.6% |
Summary of the Status of Non-vested Time-based Restricted Stock and Restricted Stock Units | Weighted Average Shares Grant-Date (000’s) Fair Value Non-vested shares and share units at December 31, 2016 4,640 $ 20.15 Granted 1,576 27.67 Vested (1,243) 20.65 Forfeited (88) 22.13 Non-vested shares and share units at September 30, 2017 4,885 $ 22.42 |
Reportable Segments (Tables)
Reportable Segments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Reportable Segments [Abstract] | |
Reportable Segments | Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Three months ended September 30, 2017 Net sales $ 768 $ 917 $ 277 $ 373 $ 223 $ 49 $ 2,607 Depreciation (1) $ 134 $ 49 $ 31 $ 34 $ 14 $ 12 $ 274 Amortization of purchased intangibles $ 11 $ 6 $ 1 $ 18 Research, development and engineering expenses (2) $ 21 $ 44 $ 28 $ 37 $ 5 $ 52 $ 187 Income tax (provision) benefit $ (82) $ (52) $ (17) $ (36) $ (8) $ 28 $ (167) Net income (loss) (3) $ 203 $ 102 $ 34 $ 72 $ 17 $ (55) $ 373 Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Three months ended September 30, 2016 Net sales $ 902 $ 795 $ 264 $ 295 $ 214 $ 37 $ 2,507 Depreciation (1) $ 152 $ 41 $ 32 $ 26 $ 14 $ 12 $ 277 Amortization of purchased intangibles $ 10 $ 5 $ 2 $ 17 Research, development and engineering expenses (2) $ 14 $ 37 $ 24 $ 31 $ 6 $ 47 $ 159 Income tax (provision) benefit $ (98) $ (49) $ (17) $ (21) $ (8) $ 21 $ (172) Net income (loss) (3) $ 279 $ 84 $ 35 $ 42 $ 16 $ (47) $ 409 Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Nine Months Ended September 30, 2017 Net sales $ 2,252 $ 2,617 $ 815 $ 1,010 $ 654 $ 131 $ 7,479 Depreciation (1) $ 393 $ 142 $ 93 $ 94 $ 39 $ 34 $ 795 Amortization of purchased intangibles $ 33 $ 16 $ 4 $ 53 Research, development and engineering expenses (2) $ 63 $ 121 $ 80 $ 110 $ 17 $ 156 $ 547 Income tax (provision) benefit $ (270) $ (149) $ (47) $ (88) $ (23) $ 83 $ (494) Net income (loss) (3) $ 663 $ 285 $ 97 $ 176 $ 48 $ (166) $ 1,103 Display Optical Environmental Specialty Life All Technologies Communications Technologies Materials Sciences Other Total Nine Months Ended September 30, 2016 Net sales $ 2,408 $ 2,186 $ 787 $ 788 $ 633 $ 112 $ 6,914 Depreciation (1) $ 452 $ 125 $ 97 $ 81 $ 42 $ 34 $ 831 Amortization of purchased intangibles $ 25 $ 15 $ 6 $ 46 Research, development and engineering expenses (2) $ 49 $ 110 $ 75 $ 96 $ 18 $ 139 $ 487 Income tax (provision) benefit $ (277) $ (99) $ (52) $ (52) $ (22) $ 87 $ (415) Net income (loss) (3) $ 692 $ 178 $ 106 $ 106 $ 45 $ (187) $ 940 (1) Depreciation expense for Corning’s reportable segments includes an allocation of depreciation of corporate property not specifically identifiable to a segment . (2) Research , development and engineering expenses include direct project spending that is identifiable to a segment. (3) Many of Corning’s administrative and staff functions are performed on a centralized basis. Where practicable, Corning charges these expenses to segments based upon the extent to which each business uses a centralized function. Other staff functions , such as corporate finance, human resources and legal, are allocated to segments, primarily as a percentage of sales. Expenses that are not allocated to the segments are included in the reconciliation of reportable net segment net income to consolidated net income below. |
Reconciliation of Reportable Segment Net Income to Consolidated Net Income | Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Net income of reportable segments $ 428 $ 456 $ 1,269 $ 1,127 Net loss of All Other (55) (47) (166) (187) Unallocated amounts: Net financing costs (1) (27) (26) (79) (84) Stock-based compensation expense (10) (10) (35) (33) Exploratory research (24) (27) (71) (82) Corporate contributions (7) (15) (29) (38) Gain on realignment of equity investment 2,676 Equity in earnings of affiliated companies (2) 30 22 140 126 Unrealized loss on foreign currency hedges related to translated earnings (24) (239) (392) (2,441) Resolution of Department of Justice investigation (98) Income tax benefit 66 193 299 1,247 Other corporate items 13 (23) (21) (90) Net income $ 390 $ 284 $ 915 $ 2,123 (1) Net financing costs include interest income, interest expense, and interest costs and investment gains and losses associated with benefit plans. (2) For the periods ending September 30, 2017, and the three months ending September 30, 2016, the amounts represent the equity earnings of HSG. Through May 31, 2016, the date of the strategic realignment of our equity interest in Dow Corning, this amount primarily represents the equity earnings from Dow Corning. Refer to Note 7, Investments, for additional information. |
Significant Accounting Polici35
Significant Accounting Policies (Narrative) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Significant Accounting Policies [Abstract] | |
Cumulative tax benefits in beginning retained earnings | $ 233 |
Commitments, Contingencies an36
Commitments, Contingencies and Guarantees (Narrative) (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Sep. 30, 2017USD ($)item | Dec. 31, 2016USD ($) | Aug. 25, 2016USD ($) | |
Loss Contingency, Accrual, Current | $ 58 | $ 88 | |||
Loss Contingency, Accrual, Noncurrent | 342 | 369 | |||
Recorded Unconditional Purchase Obligation | $ 230 | 231 | |||
Pittsburgh Corning Corporation PCC [Member] | |||||
Equity Method Investment, Ownership Percentage | 50.00% | ||||
Pittsburgh Corning Corporation PCC [Member] | PPG Industries, Inc. [Member] | |||||
Equity Method Investment, Ownership Percentage | 50.00% | ||||
Asbestos Litigation [Member] | Amended Pittsburgh Corning Corporation Plan [Member] | |||||
Loss Contingency, Estimate of Possible Loss | 290 | ||||
Payment of claims | $ 70 | ||||
Loss Contingency, Accrual | $ 220 | ||||
Loss Contingency, Accrual, Current | 35 | ||||
Loss Contingency, Accrual, Noncurrent | $ 185 | ||||
Loss Contingency Accrual, Period Increase (Decrease) | $ (238) | ||||
Environmental Cleanup and Related Litigation [Member] | |||||
Number of Hazardous Waste Sites | item | 16 | ||||
Accrual for Environmental Loss Contingencies | $ 40 | 43 | |||
Non-PCC Asbestos Litigation [Member] | Asbestos Litigation [Member] | |||||
Loss Contingency, Accrual, Noncurrent | $ 148 | 149 | $ 150 | ||
Undiscounted Projection of Claims and Related Legal Fees Period | 20 years | ||||
Contingent Guarantees [Member] | |||||
Guarantor Obligations, Maximum Exposure, Undiscounted | $ 317 | $ 267 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) $ in Millions | 9 Months Ended | |||
Sep. 30, 2017USD ($) | Sep. 30, 2017JPY (¥) | Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Debt Instrument, Fair Value Disclosure | $ | $ 4,400 | $ 3,900 | ||
Long-term debt | $ | $ 3,994 | $ 3,646 | ||
Proceeds from Issuance of Unsecured Debt | $ | $ 702 | |||
0.698% Note 7 year term [Member] | Senior Notes [Member] | ||||
Debt Instrument, Face Amount | ¥ | ¥ 21,000,000,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 0.698% | 0.698% | ||
Debt Instrument, Term | 7 years | |||
0.992% Note 10 year term [Member] | Senior Notes [Member] | ||||
Debt Instrument, Face Amount | ¥ | ¥ 47,000,000,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 0.992% | 0.992% | ||
Debt Instrument, Term | 10 years | |||
1.583% Note 20 year term [Member] | Senior Notes [Member] | ||||
Debt Instrument, Face Amount | ¥ | ¥ 10,000,000,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 1.583% | 1.583% | ||
Debt Instrument, Term | 20 years |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Taxes [Abstract] | ||||
Statutory U.S. income tax rate | 35.00% | 35.00% | 35.00% | 35.00% |
Income Taxes (Provision for Inc
Income Taxes (Provision for Income Taxes) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Taxes [Abstract] | ||||
(Provision) benefit for income taxes | $ (89) | $ 27 | $ (176) | $ 835 |
Effective income tax rate (benefit) | 18.60% | (10.50%) | 16.10% | (64.80%) |
Earnings per Common Share (Comp
Earnings per Common Share (Computation of Basic and Diluted Earnings per Common Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net income attributable to Corning Incorporated | $ 390 | $ 284 | $ 915 | $ 2,123 |
Less: Series A convertible preferred stock dividend | 24 | 24 | 73 | 73 |
Net income available to common stockholders – basic | 366 | 260 | 842 | 2,050 |
Plus: Series A convertible preferred stock dividend | 24 | 24 | 73 | 73 |
Net income available to common stockholders – diluted | $ 390 | $ 284 | $ 915 | $ 2,123 |
Weighted-average common shares outstanding - basic (in shares) | 883 | 978 | 905 | 1,046 |
Effect of dilutive securities: | ||||
Weighted-average common shares outstanding - diluted (in shares) | 1,009 | 1,102 | 1,031 | 1,170 |
Basic earnings per common share (in dollars per share) | $ 0.41 | $ 0.27 | $ 0.93 | $ 1.96 |
Diluted earnings per common share (in dollars per share) | $ 0.39 | $ 0.26 | $ 0.89 | $ 1.81 |
Anti-dilutive potential shares excluded from diluted earnings per common share: | ||||
Antidilutive potential shares excluded from diluted earnings per common share (in shares) | 1 | 27 | 2 | 32 |
Stock Compensation Plan [Member] | ||||
Anti-dilutive potential shares excluded from diluted earnings per common share: | ||||
Antidilutive potential shares excluded from diluted earnings per common share (in shares) | 1 | 13 | 2 | 18 |
Accelerated Share Repurchase Foward Contracts [Member] | ||||
Anti-dilutive potential shares excluded from diluted earnings per common share: | ||||
Antidilutive potential shares excluded from diluted earnings per common share (in shares) | 14 | 14 | ||
Stock Options and Other Dilutive Securities [Member] | ||||
Effect of dilutive securities: | ||||
Stock options and other dilutive securities (in shares) | 11 | 9 | 11 | 9 |
Series A Convertible Preferred Stock [Member] | ||||
Effect of dilutive securities: | ||||
Stock options and other dilutive securities (in shares) | 115 | 115 | 115 | 115 |
Inventories, Net of Inventory41
Inventories, Net of Inventory Reserves (Inventories, Net) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Inventories, Net of Inventory Reserves [Abstract] | ||
Finished goods | $ 720 | $ 606 |
Work in process | 328 | 303 |
Raw materials and accessories | 314 | 270 |
Supplies and packing materials | 331 | 292 |
Total inventories, net of inventory reserves | $ 1,693 | $ 1,471 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - USD ($) $ in Millions | May 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Aug. 25, 2016 |
Removal of Carrying Value of Equity Method Investment | $ (383) | ||||||||
Realignment of Equity Investment, Gain (Loss) | $ 2,676 | $ 2,676 | $ 2,676 | ||||||
Loss Contingency, Accrual, Noncurrent | $ 342 | $ 342 | $ 369 | ||||||
Loss Contingency, Accrual, Current | 58 | 58 | 88 | ||||||
Asbestos Litigation [Member] | Non-PCC Asbestos Litigation [Member] | |||||||||
Loss Contingency, Accrual, Noncurrent | 148 | 148 | $ 149 | $ 150 | |||||
Asbestos Litigation [Member] | Amended Pittsburgh Corning Corporation Plan [Member] | |||||||||
Loss Contingency Accrual, Period Increase (Decrease) | (238) | ||||||||
Loss Contingency, Accrual, Noncurrent | 185 | 185 | |||||||
Loss Contingency, Accrual, Current | $ 35 | $ 35 | |||||||
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||||||
Removal of Carrying Value of Equity Method Investment | $ (383) | ||||||||
Release of Deferred Tax Liabilities | $ 105 | ||||||||
Dow Corning Corporation [Member] | |||||||||
Equity Method Investment, Ownership Percentage | 50.00% | ||||||||
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions | 100.00% | ||||||||
Pittsburgh Corning Corporation PCC [Member] | |||||||||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% | |||||||
HSG [Member] | |||||||||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% | |||||||
Gross profit | $ 72 | $ 61 | $ 180 | 113 | |||||
Net income | $ 59 | $ 44 | $ 285 | $ 87 | |||||
HSG [Member] | |||||||||
Equity Method Investments | $ 4,800 | ||||||||
PPG Industries, Inc. [Member] | Pittsburgh Corning Corporation PCC [Member] | |||||||||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% |
Investments (Gain of Realignmen
Investments (Gain of Realignment) (Details) - USD ($) $ in Millions | May 31, 2016 | Jun. 30, 2016 | Jun. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 |
Gain of Realignment [Line Items] | |||||
Cash | $ 4,818 | $ 4,818 | |||
Carrying Value of Dow Corning Equity Investment | (1,560) | ||||
Carrying Value of HSG Equity Investment | (383) | ||||
Other | (199) | ||||
Gain | $ 2,676 | $ 2,676 | $ 2,676 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Gain of Realignment [Line Items] | |||||
Carrying Value of HSG Equity Investment | $ (383) | ||||
Defined Benefit Plan, Actuarial Gain (Loss) | $ 260 | ||||
Foreign Currency Transaction Gain, before Tax | $ 45 |
Investments (Investments) (Deta
Investments (Investments) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | May 31, 2016 |
Other investments | $ 68 | $ 67 | |
Investment assets | 352 | 336 | |
Investment liabilities | 202 | 241 | |
Dow Corning Corporation [Member] | |||
Ownership interest | 50.00% | ||
All Other [Member] | |||
Investment in affiliated companies, at equity | $ 284 | 269 | |
HSG [Member] | |||
Ownership interest | 50.00% | ||
Investment liabilities | $ 202 | $ 241 | |
HSG [Member] | |||
Investment in affiliated companies, at equity | $ 4,800 | ||
HSG [Member] | HSC Operating Partnership [Member] | |||
Ownership interest | 80.50% | ||
Minimum [Member] | All Other [Member] | |||
Ownership interest | 20.00% | ||
Maximum [Member] | All Other [Member] | |||
Ownership interest | 50.00% |
Investments (Results From Opera
Investments (Results From Operations) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Equity in earnings of affiliated companies | $ 31 | $ 19 | $ 148 | $ 119 |
Proceeds from Equity Method Investment, Dividends or Distributions | 101 | 20 | ||
Pre-tax gain on settlements of long-term sales agreements | 75 | |||
HSG [Member] | ||||
Net sales | 286 | 217 | 887 | 397 |
Gross profit | 72 | 61 | 180 | 113 |
Net income | $ 59 | $ 44 | 285 | $ 87 |
Gain on settlements of long-term sales agreements, net | $ 151 |
Goodwill and Other Intangible46
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Goodwill, Impairment Loss | $ 6,500 | $ 6,500 | |||
Goodwill, Gross | $ 8,200 | 8,200 | $ 8,100 | ||
Amortization of Intangible Assets | 18 | $ 17 | 53 | $ 46 | |
Finite-Lived Intangible Assets, Amortization Expense, Remainder of 2017 | 71 | 71 | |||
Finite-Lived Intangible Assets, Amortization Expense, 2018 | 74 | 74 | |||
Finite-Lived Intangible Assets, Amortization Expense, 2019 | 74 | 74 | |||
Finite-Lived Intangible Assets, Amortization Expense, 2020 | 70 | 70 | |||
Finite-Lived Intangible Assets, Amortization Expense, 2021 | 70 | 70 | |||
Finite-Lived Intangible Assets, Amortization Expense, 2022 | $ 70 | 70 | |||
Optical Communications [Member] | |||||
Finite-lived Intangible Assets Acquired | 132 | ||||
Finite Lived Intangible Assets, Foreign Currency Translation Gain (Loss) | 16 | ||||
Amortization of Intangible Assets | $ 53 |
Goodwill and Other Intangible47
Goodwill and Other Intangible Assets (Carrying Amount of Goodwill by Segment) (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017USD ($)item | Mar. 31, 2017USD ($)item | Sep. 30, 2017USD ($) | |
Balance | $ 1,577 | $ 1,577 | |
Acquired goodwill | 99 | ||
Measurement period adjustment | (28) | ||
Foreign currency translation adjustment | 36 | ||
Balance | $ 1,684 | 1,684 | |
Display Technologies [Member] | |||
Balance | 126 | 126 | |
Foreign currency translation adjustment | 4 | ||
Balance | 130 | 130 | |
Optical Communications [Member] | |||
Balance | 645 | 645 | |
Acquired goodwill | 22 | ||
Foreign currency translation adjustment | 7 | ||
Balance | $ 674 | 674 | |
Number of acquisitions | item | 2 | ||
Specialty Materials [Member] | |||
Balance | 150 | 150 | |
Balance | $ 150 | 150 | |
Life Sciences [Member] | |||
Balance | 558 | 558 | |
Acquired goodwill | 43 | ||
Foreign currency translation adjustment | 18 | ||
Balance | 619 | 619 | |
All Other [Member] | |||
Balance | $ 98 | 98 | |
Acquired goodwill | 34 | ||
Measurement period adjustment | (28) | ||
Foreign currency translation adjustment | 7 | ||
Balance | $ 111 | $ 111 | |
Number of acquisitions | item | 1 |
Goodwill and Other Intangible48
Goodwill and Other Intangible Assets (Other Intangible Assets) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Amortized intangible assets: | ||
Other intangible assets, gross | $ 1,274 | $ 1,121 |
Other intangible assets, accumulated amortization | 383 | 325 |
Other intangible assets, net | 891 | 796 |
Patents, Trademarks, and Trade Names [Member] | ||
Amortized intangible assets: | ||
Other intangible assets, gross | 382 | 360 |
Other intangible assets, accumulated amortization | 192 | 176 |
Other intangible assets, net | 190 | 184 |
Customer Lists and Other [Member] | ||
Amortized intangible assets: | ||
Other intangible assets, gross | 892 | 761 |
Other intangible assets, accumulated amortization | 191 | 149 |
Other intangible assets, net | $ 701 | $ 612 |
Employee Retirement Plans (Narr
Employee Retirement Plans (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Recognition of actuarial loss | $ 26 | $ 15 | |
Pension Benefits [Member] | |||
Recognition of actuarial loss | $ (26) | $ (15) | $ (60) |
Employee Retirement Plans (Net
Employee Retirement Plans (Net Periodic Benefit Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Recognition of actuarial loss | $ (26) | $ (15) | ||
Pension Benefits [Member] | ||||
Service cost | $ 22 | 22 | 69 | $ 65 |
Interest cost | 32 | 31 | 94 | 93 |
Expected return on plan assets | (43) | (41) | (130) | (124) |
Amortization of prior service cost (credit) | 1 | 1 | 4 | 4 |
Recognition of actuarial loss | 26 | 15 | 60 | |
Total pension and postretirement benefit expense | 12 | 39 | 52 | 98 |
Postretirement Benefits [Member] | ||||
Service cost | 2 | 3 | 7 | 7 |
Interest cost | 7 | 6 | 20 | 19 |
Amortization of net loss | (1) | |||
Amortization of prior service cost (credit) | (1) | (1) | (2) | (3) |
Total pension and postretirement benefit expense | $ 8 | $ 8 | $ 25 | $ 22 |
Other Liabilities (Narrative) (
Other Liabilities (Narrative) (Details) - Pittsburgh Corning Corporation PCC [Member] | Sep. 30, 2017 |
Equity Method Investment, Ownership Percentage | 50.00% |
PPG Industries, Inc. [Member] | |
Equity Method Investment, Ownership Percentage | 50.00% |
Other Liabilities (Other Liabil
Other Liabilities (Other Liabilities) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Other Liabilities [Abstract] | ||
Wages and employee benefits | $ 513 | $ 487 |
Income taxes | 135 | 150 |
Derivative instruments | 39 | 70 |
Asbestos and other litigation | 58 | 88 |
Other current liabilities | 510 | 621 |
Other accrued liabilities | 1,255 | 1,416 |
Defined benefit pension plan liabilities | 743 | 692 |
Derivative instruments | 343 | 282 |
Asbestos and other litigation reserves | 342 | 369 |
Investment in Hemlock Semiconductor Group | 202 | 241 |
Other non-current liabilities | 1,310 | 1,221 |
Other liabilities | $ 2,940 | $ 2,805 |
Hedging Activities (Narrative)
Hedging Activities (Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Derivative Asset, Notional Amount | $ 16,818 | $ 18,609 |
Gross Notional Value, Translated Earnings Contracts [Member] | ||
Derivative Asset, Notional Amount | 15,200 | 16,700 |
Gross Notional Value, Collar Options [Member] | ||
Derivative Asset, Notional Amount | 1,100 | 2,000 |
Gross Notional Value, Foreign Exchange Forward [Member] | ||
Derivative Asset, Notional Amount | 14,100 | 14,700 |
Gross Notional Value, Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivative Asset, Notional Amount | 12,400 | 13,600 |
Net Notional Value, Collar Options [Member] | ||
Derivative Asset, Notional Amount | $ 700 | $ 1,000 |
Hedging Activities (Summary of
Hedging Activities (Summary of Notional Amounts and Respective Fair Values of Derivative Financial Instruments) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Notional amount | $ 16,818 | $ 18,609 |
Asset derivatives, fair value | 284 | 581 |
Liability derivatives, fair value | (401) | (370) |
Foreign Exchange Contract [Member] | Other Assets [Member] | ||
Asset derivatives, fair value | 8 | |
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | ||
Notional amount | 381 | 458 |
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Asset derivatives, fair value | 12 | 1 |
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Accrued Liabilities [Member] | ||
Liability derivatives, fair value | (3) | (29) |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | ||
Notional amount | 676 | 890 |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Asset derivatives, fair value | 7 | 11 |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Accrued Liabilities [Member] | ||
Liability derivatives, fair value | (3) | (7) |
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | ||
Notional amount | 550 | 550 |
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Liabilities [Member] | ||
Liability derivatives, fair value | (5) | (5) |
Translated Earnings Contracts [Member] | Other Assets [Member] | ||
Asset derivatives, fair value | 82 | 146 |
Translated Earnings Contracts [Member] | Other Liabilities [Member] | ||
Liability derivatives, fair value | (338) | (277) |
Translated Earnings Contracts [Member] | Not Designated as Hedging Instrument [Member] | ||
Notional amount | 15,211 | 16,711 |
Translated Earnings Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Asset derivatives, fair value | 175 | 423 |
Translated Earnings Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Accrued Liabilities [Member] | ||
Liability derivatives, fair value | $ (52) | $ (52) |
Hedging Activities (Effect on C
Hedging Activities (Effect on Consolidated Financial Statements) (Details) - Cash Flow Hedging [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Gain/(loss) recognized in other comprehensive income (OCI) | $ 3 | $ 1 | $ 36 | $ (63) |
Gain/(loss) reclassified from accumulated OCI into income ineffective/effective | (1) | (12) | (11) | (26) |
Interest Rate Hedges [Member] | Sales [Member] | ||||
Gain/(loss) reclassified from accumulated OCI into income ineffective/effective | 1 | |||
Foreign Exchange Contract [Member] | ||||
Gain/(loss) recognized in other comprehensive income (OCI) | 3 | 1 | 36 | (63) |
Foreign Exchange Contract [Member] | Sales [Member] | ||||
Gain/(loss) reclassified from accumulated OCI into income ineffective/effective | 1 | 2 | ||
Foreign Exchange Contract [Member] | Cost of Sales [Member] | ||||
Gain/(loss) reclassified from accumulated OCI into income ineffective/effective | $ (1) | $ (13) | (11) | (27) |
Foreign Exchange Contract [Member] | Other Expense [Member] | ||||
Gain/(loss) reclassified from accumulated OCI into income ineffective/effective | $ (1) | $ (1) |
Hedging Activities (Effect on56
Hedging Activities (Effect on Consolidated Financial Statements) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Translated earnings contract (loss) gain, net | $ 26 | $ (237) | $ (193) | $ (2,295) |
Not Designated as Hedging Instrument [Member] | ||||
Translated earnings contract (loss) gain, net | 19 | (241) | (212) | (2,373) |
Foreign Exchange Contracts, Balance Sheet [Member] | Foreign Currency Transaction and Hedge Gain (Loss), Net [Member] | Not Designated as Hedging Instrument [Member] | ||||
Translated earnings contract (loss) gain, net | (7) | (4) | (19) | (78) |
Translated Earnings Contracts [Member] | Foreign Currency Transaction and Hedge Gain (Loss), Net [Member] | Not Designated as Hedging Instrument [Member] | ||||
Translated earnings contract (loss) gain, net | $ 26 | $ (237) | $ (193) | $ (2,295) |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Fair Value Measurements [Abstract] | ||
Business Combination, Contingent Consideration, Asset | $ 294 | $ 289 |
Liabilities, Fair Value Disclosure, Nonrecurring | 0 | 0 |
Assets, Fair Value Disclosure, Nonrecurring | $ 0 | $ 0 |
Fair Value Measurements (Major
Fair Value Measurements (Major Categories of Financial Assets and Liabilities Measured on a Recurring Basis) (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Other current assets | $ 488 | $ 435 |
Other assets | 90 | 464 |
Other accrued liabilities | 63 | 88 |
Other liabilities | 363 | 282 |
Fair Value, Inputs, Level 2 [Member] | ||
Other current assets | 194 | 435 |
Other assets | 90 | 175 |
Other accrued liabilities | 58 | 88 |
Other liabilities | 343 | 282 |
Fair Value, Inputs, Level 3 [Member] | ||
Other current assets | 294 | |
Other assets | $ 289 | |
Other accrued liabilities | 5 | |
Other liabilities | 20 | |
Contingent consideration | $ 25 |
Shareholders' Equity (Narrative
Shareholders' Equity (Narrative) (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jul. 31, 2016 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Treasury Stock, Shares, Acquired | 197,100,000 | |||||||
Treasury Stock, Value, Acquired, Cost Method | $ 4,200 | |||||||
Payments for Repurchase of Common Stock | $ 2,064 | $ 3,884 | ||||||
Gain on Realignment of Equity Investment [Member] | ||||||||
Foreign Currency Transaction Gain, before Tax | $ 45 | |||||||
Cumulative Unamortized Actuarial Loss Released During Period, Net of Tax | 260 | |||||||
Cumulative Unamortized Actuarial Loss Released During Period,Tax | 19 | |||||||
Selling, General and Administrative Expenses [Member] | ||||||||
Foreign Currency Transaction Loss, before Tax | $ 22 | |||||||
The 2015 Repurchase Program [Member] | Open Market [Member] | ||||||||
Treasury Stock, Shares, Acquired | 110,400,000 | |||||||
Treasury Stock, Value, Acquired, Cost Method | $ 2,200 | |||||||
The 2016 ASR Agreement [Member] | ||||||||
Treasury Stock, Shares, Acquired | 86,700,000 | |||||||
Payments for Repurchase of Common Stock | $ 2,000 | |||||||
The 2016 Repurchase Program [Member] | ||||||||
Stock Repurchase Program, Authorized Amount | $ 4,000 | $ 4,000 | ||||||
The 2015 and 2016 Repurchase Program [Member] | Open Market [Member] | ||||||||
Treasury Stock, Shares, Acquired | 17,200,000 | 37,600,000 | ||||||
Treasury Stock, Value, Acquired, Cost Method | $ 507.7 | $ 1,100 | ||||||
The 2017 ASR Agreement [Member] | ||||||||
Treasury Stock, Shares, Acquired | 17,200,000 | 17,100,000 | ||||||
Payments for Repurchase of Common Stock | $ 500 | $ 500 | ||||||
Common Stock [Member] | ||||||||
Convertible Preferred Stock, Shares Issued upon Conversion | 50,000 | 50,000 | ||||||
Accumulated Net Investment Gain (Loss) Attributable to Parent [Member] | ||||||||
Other Comprehensive Income (Loss), Tax | $ (14) | |||||||
Series A Convertible Preferred Stock [Member] | Samsung Corning Precision Materials Co., Ltd. [Member] | ||||||||
Convertible Preferred Stock, Shares Issued upon Conversion | 2,300 | 2,300 |
Shareholders' Equity (Accumulat
Shareholders' Equity (Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Balance | $ (1,676) | |||
Balance | $ (1,146) | (1,146) | ||
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | ||||
Balance | (871) | $ (547) | (1,275) | $ (1,171) |
Other comprehensive income | 49 | 235 | 435 | 860 |
Equity method affiliates | 4 | 10 | 22 | 9 |
Net current-period other comprehensive (loss) income | 53 | 245 | 457 | 869 |
Balance | (818) | (302) | (818) | (302) |
Foreign Currency Transaction Gain (Loss), Tax | 32 | 47 | 51 | |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | ||||
Balance | (330) | (323) | (347) | (588) |
Other comprehensive income | (31) | (64) | ||
Amounts reclassified from accumulated other comprehensive income | 26 | 17 | 60 | |
Equity method affiliates | 264 | |||
Net current-period other comprehensive (loss) income | (5) | 17 | 260 | |
Balance | $ (330) | (328) | (330) | (328) |
Other Comprehensive Income (Loss), Equity Method Investments, Tax | 19 | 19 | ||
Amounts reclassified from accumulated other comprehensive income, Tax | $ (3) | $ 10 | $ (4) |
Share-based Compensation (Narra
Share-based Compensation (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Allocated Share-based Compensation Expense | $ 10 | $ 10 | $ 35 | $ 33 |
Proceeds from Stock Options Exercised | 275 | 86 | ||
Employee Stock Option [Member] | ||||
Allocated Share-based Compensation Expense | 1 | 2 | $ 11 | 10 |
Stock Options Exercisable Period from Date of Grant | 3 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | 8 | $ 8 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years | |||
Proceeds from Stock Options Exercised | $ 275 | 86 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 83 | 36 | ||
Years of Historical Volatility Included in Most Recent Volatility | 15 years | |||
Restricted Stock and Restricted Stock Units [Member] | ||||
Allocated Share-based Compensation Expense | 9 | $ 8 | $ 24 | $ 23 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 51 | $ 51 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 6 months | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years |
Share-based Compensation (Summa
Share-based Compensation (Summary of Information Concerning Stock Options Outstanding Including the Related Transactions under the Stock Option Plans) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($)$ / sharesshares | |
Share-based Compensation [Abstract] | |
Balance, number of shares (in shares) | shares | 31,507 |
Granted, number of shares (in shares) | shares | 1,505 |
Exercised, number of shares (in shares) | shares | (12,915) |
Forfeited and expired, number of shares (in shares) | shares | (254) |
Balance, number of shares (in shares) | shares | 19,843 |
Options Expected to Vest, number of shares (in shares) | shares | 19,801 |
Options Exercisable, number of shares (in shares) | shares | 15,173 |
Balance, weighted-average exercise price (in dollars per share) | $ / shares | $ 19.40 |
Granted, weighted-average exercise price (in dollars per share) | $ / shares | 27.01 |
Exercised, weighted-average exercise price (in dollars per share) | $ / shares | 21.26 |
Forfeited and expired, weighted-average exercise price (in dollars per share) | $ / shares | 23.21 |
Balance, weighted-average exercise price (in dollars per share) | $ / shares | 18.72 |
Options Expected to Vest, weighted-average exercise price (in dollars per share) | $ / shares | 18.71 |
Options Exercisable, weighted-average exercise price (in dollars per share) | $ / shares | $ 17.47 |
Options Outstanding, weighted-average remaining contractual term in years (Year) | 4 years 7 months 28 days |
Options Expected to Vest, weighted-average remaining contractual term in years (Year) | 4 years 7 months 24 days |
Options Exercisable, weighted-average remaining contractual term in years (Year) | 3 years 5 months 19 days |
Options Outstanding, aggregate intrinsic value | $ | $ 222,313 |
Options Expected to Vest, aggregate intrinsic value | $ | 222,056 |
Options Exercisable, aggregate intrinsic value | $ | $ 188,890 |
Share-based Compensation (Input
Share-based Compensation (Inputs Used for Valuation of Option Grants under Stock Option Plans) (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Expected volatility | 34.20% | 38.60% | ||
Weighted-average volatility | 34.20% | 38.60% | ||
Expected dividends | 2.18% | 2.34% | ||
Risk-free rate | 2.10% | 1.40% | ||
Average risk-free rate | 2.10% | 1.40% | ||
Expected term (in years) | 7 years 4 months 24 days | 7 years 4 months 24 days | ||
Pre-vesting departure rate | 0.60% | 0.60% | ||
Minimum [Member] | ||||
Expected volatility | 34.20% | 38.60% | ||
Weighted-average volatility | 34.20% | 38.60% | ||
Expected dividends | 2.11% | 2.34% | ||
Risk-free rate | 2.10% | 1.40% | ||
Average risk-free rate | 2.10% | 1.40% | ||
Expected term (in years) | 7 years 4 months 24 days | 7 years 4 months 24 days | ||
Pre-vesting departure rate | 0.60% | 0.60% | ||
Maximum [Member] | ||||
Expected volatility | 36.10% | 43.10% | ||
Weighted-average volatility | 36.10% | 43.10% | ||
Expected dividends | 2.28% | 2.94% | ||
Risk-free rate | 2.30% | 1.60% | ||
Average risk-free rate | 2.30% | 1.60% | ||
Expected term (in years) | 7 years 4 months 24 days | 7 years 4 months 24 days | ||
Pre-vesting departure rate | 0.60% | 0.60% |
Share-based Compensation (Sum64
Share-based Compensation (Summary of the Status of Non-vested Time-based Restricted Stock and Restricted Stock Units) (Details) shares in Thousands | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Share-based Compensation [Abstract] | |
Balance, shares (in shares) | shares | 4,640 |
Granted, shares (in shares) | shares | 1,576 |
Vested, shares (in shares) | shares | (1,243) |
Forfeited, shares (in shares) | shares | (88) |
Balance, shares (in shares) | shares | 4,885 |
Balance, weighted average grant-date fair value (in dollars per share) | $ / shares | $ 20.15 |
Granted, weighted average grant-date fair value (in dollars per share) | $ / shares | 27.67 |
Vested, weighted average grant-date fair value (in dollars per share) | $ / shares | 20.65 |
Forfeited, weighted average grant-date fair value (in dollars per share) | $ / shares | 22.13 |
Balance, weighted average grant-date fair value (in dollars per share) | $ / shares | $ 22.42 |
Reportable Segments (Narrative)
Reportable Segments (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2017item | |
Reportable Segments [Abstract] | |
Number of Material Formulations | 150 |
Reportable Segments (Reportable
Reportable Segments (Reportable Segments) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net sales | $ 2,607 | $ 2,507 | $ 7,479 | $ 6,914 |
Depreciation | 799 | 844 | ||
Amortization of purchased intangibles | 18 | 17 | 53 | 46 |
Research, development and engineering expenses | 213 | 187 | 620 | 569 |
Restructuring, impairment and other charges | 78 | |||
Income tax (provision) benefit | (89) | 27 | (176) | 835 |
Net income | 390 | 284 | 915 | 2,123 |
Reportable Segments [Member] | ||||
Net sales | 2,607 | 2,507 | 7,479 | 6,914 |
Depreciation | 274 | 277 | 795 | 831 |
Amortization of purchased intangibles | 18 | 17 | 53 | 46 |
Research, development and engineering expenses | 187 | 159 | 547 | 487 |
Income tax (provision) benefit | (167) | (172) | (494) | (415) |
Net income | 373 | 409 | 1,103 | 940 |
Display Technologies [Member] | Reportable Segments [Member] | ||||
Net sales | 768 | 902 | 2,252 | 2,408 |
Depreciation | 134 | 152 | 393 | 452 |
Research, development and engineering expenses | 21 | 14 | 63 | 49 |
Income tax (provision) benefit | (82) | (98) | (270) | (277) |
Net income | 203 | 279 | 663 | 692 |
Optical Communications [Member] | ||||
Amortization of purchased intangibles | 53 | |||
Optical Communications [Member] | Reportable Segments [Member] | ||||
Net sales | 917 | 795 | 2,617 | 2,186 |
Depreciation | 49 | 41 | 142 | 125 |
Amortization of purchased intangibles | 11 | 10 | 33 | 25 |
Research, development and engineering expenses | 44 | 37 | 121 | 110 |
Income tax (provision) benefit | (52) | (49) | (149) | (99) |
Net income | 102 | 84 | 285 | 178 |
Environmental Technologies [Member] | Reportable Segments [Member] | ||||
Net sales | 277 | 264 | 815 | 787 |
Depreciation | 31 | 32 | 93 | 97 |
Research, development and engineering expenses | 28 | 24 | 80 | 75 |
Income tax (provision) benefit | (17) | (17) | (47) | (52) |
Net income | 34 | 35 | 97 | 106 |
Specialty Materials [Member] | Reportable Segments [Member] | ||||
Net sales | 373 | 295 | 1,010 | 788 |
Depreciation | 34 | 26 | 94 | 81 |
Research, development and engineering expenses | 37 | 31 | 110 | 96 |
Income tax (provision) benefit | (36) | (21) | (88) | (52) |
Net income | 72 | 42 | 176 | 106 |
Life Sciences [Member] | Reportable Segments [Member] | ||||
Net sales | 223 | 214 | 654 | 633 |
Depreciation | 14 | 14 | 39 | 42 |
Amortization of purchased intangibles | 6 | 5 | 16 | 15 |
Research, development and engineering expenses | 5 | 6 | 17 | 18 |
Income tax (provision) benefit | (8) | (8) | (23) | (22) |
Net income | 17 | 16 | 48 | 45 |
All Other [Member] | Reportable Segments [Member] | ||||
Net sales | 49 | 37 | 131 | 112 |
Depreciation | 12 | 12 | 34 | 34 |
Amortization of purchased intangibles | 1 | 2 | 4 | 6 |
Research, development and engineering expenses | 52 | 47 | 156 | 139 |
Income tax (provision) benefit | 28 | 21 | 83 | 87 |
Net income | $ (55) | $ (47) | $ (166) | $ (187) |
Reportable Segments (Reconcilia
Reportable Segments (Reconciliation of Reportable Segment Net Income to Consolidated Net Income) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net financing costs | $ (27) | $ (26) | $ (79) | $ (84) | ||
Stock-based compensation expense | (10) | (10) | (35) | (33) | ||
Exploratory research | (24) | (27) | (71) | (82) | ||
Corporate contributions | (7) | (15) | (29) | (38) | ||
Gain on realignment of equity investment | $ 2,676 | $ 2,676 | 2,676 | |||
Equity in earnings of affiliated companies | 30 | 22 | 140 | 126 | ||
Unrealized loss on foreign currency hedges related to translated earnings | (24) | (239) | (392) | (2,441) | ||
Resolution of Department of Justice investigation | (98) | |||||
Income tax benefit | 66 | 193 | 299 | 1,247 | ||
Other corporate items | 13 | (23) | (21) | (90) | ||
Net income | 390 | 284 | 915 | 2,123 | ||
Reportable Segments [Member] | ||||||
Net income | 428 | 456 | 1,269 | 1,127 | ||
Non Reportable Segments [Member] | ||||||
Net income | $ (55) | $ (47) | $ (166) | $ (187) |