Corning: Gorilla Glass to be $800 million business in 2011
Correction amended below.
Gorilla Glass won't reach $1 billion in sales for 2011 thanks to weaker-than-expected demand TV cover glass, said Corning. But Gorilla Glass will post sales of about $800 million, triple relative to last year's tally.
Corning, a large glass supplier, has a specialty materials unit that has seen sales surge in recent quarters as demand for smartphones, tablets and laptops have sparked Gorilla Glass sales. In the second quarter, Corning’s specialty materials business delivered sales of $283 million, up 125 percent from a year ago.
Corning is projecting that Gorilla Glass will deliver sales of about $800 million. Last quarter, Corning said Gorilla Glass sales were on track to hit $1 billion.
James Flaws, Corning’s CFO, said:
We no longer believe that Corning Gorilla Glass sales this year have the potential to reach $1 billion. Rather, we expect sales will be in the area of $800 million. This adjustment is driven by our realization that television cover glass sales will not be as strong as we originally hoped.
In addition, Corning said that LCD panel demand looked mixed. Flaws said:
The display industry has been behaving more cautiously in recent weeks, driven primarily by weaker retail expectations for the second half. We have seen many LCD TV brands reduce their sales forecasts for the year. As LCD panel manufacturers have taken a more measured approach to their supply chain demands, they may be waiting a little longer to raise panel fab utilization for seasonal fourth-quarter retail demand.
Overall, Corning now sees the worldwide glass market to be between 3.3 billion and 3.4 billion square feet, down estimates of 3.5 billion to 3.7 billion square feet. In 2010, glass volume was 3.15 billion square feet.
Corning reported second quarter earnings of $755 million, or 47 cents a share, on revenue of $2 billion. Non-GAAP earnings of 48 cents a share were a penny ahead of Wall Street estimates.
Correction: The original version of this misstated the connection between the LCD market and Gorilla Glass. Although Gorilla Glass will be an $800 million business it is still growing strongly. We regret the error.
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