康寧 (GLW) 2015 Q3 法說會逐字稿

Welcome to the Corning Incorporated quarter-three 2015 earnings results. It is my pleasure to turn the call over to Ann Nicholson, Division Vice President of Investor Relations. Please, go ahead.

歡迎收聽康寧公司（Corning Incorporated）2015 年第三季財報結果說明。我很高興將電話會議交給投資人關係事業部副總裁 Ann Nicholson。請開始。

Thank you, Roxanne. Good morning. Welcome to Corning's third-quarter conference call. With me today is: Wendell Weeks, Chairman, Chief Executive Officer; Tony Tripeny, Senior Vice President and Chief Financial Officer; and Jeff Evenson, Senior Vice President and Chief Strategy Officer.

謝謝你，Roxanne。各位早安。歡迎參加康寧第三季電話會議。今天與我一同出席的有：董事長兼執行長 Wendell Weeks；資深副總裁兼財務長 Tony Tripeny；以及資深副總裁兼策略長 Jeff Evenson。

Before we begin our formal comments, I would like to remind you that today's remarks contain forward-looking statements that fall within the meaning of the Private Securities Litigation Reform Act of 1995. These remarks involve a number of risks, uncertainties and other factors that could cause actual results to differ materially. These factors are detailed in the Company's financial reports. You should also note that this presentation contains a number of non-GAAP measures and our results are presented in four performance measures. A reconciliation can found can be found on our website.

在我們開始正式發言之前，我想提醒各位，今天的談話包含前瞻性陳述，屬於 1995 年《私人證券訴訟改革法》（Private Securities Litigation Reform Act of 1995）所界定的範圍。這些陳述涉及多項風險、不確定性及其他因素，可能導致實際結果出現重大差異。相關因素已在本公司的財務報告中詳述。另外請注意，本簡報包含多項非 GAAP 指標，我們的結果以四項績效衡量指標呈現。相關調節表可在我們的網站上找到。

We have slides posting live on our webcast that are accompanying our formal comments. They will be available on our website later this morning. Now, I will turn the call over to Wendell.

我們的網路直播上正同步展示投影片，配合我們的正式發言。投影片將於今天上午稍晚在我們的網站上提供。現在我把電話交給 Wendell。

Thank you, Ann. Good morning, everyone. I'd like to begin by welcoming Tony Tripeny, our new CFO and Jeff Evenson, our new Chief Strategy Officer. Welcome, Tony and Jeff.

謝謝你，Ann。各位早安。我想先歡迎我們的新任財務長 Tony Tripeny，以及新任策略長 Jeff Evenson。歡迎 Tony 與 Jeff。

As we reported in this morning's press release, macroeconomic headwinds are affecting our performance in the near term. Our businesses were slowed by the weakening global economy, the unexpected devaluation of the Chinese currency and the softening in the television and IT retail markets. Consequently, our third-quarter results were lower than implied by our first-half performance. We expect these headwinds to continue into the fourth quarter.

如同我們今早新聞稿所述，總體經濟逆風在短期內正影響我們的表現。全球經濟走弱、中國貨幣意外貶值，以及電視與 IT 零售市場轉弱，皆使我們的業務放緩。因此，我們第三季的結果低於上半年表現所隱含的水準。我們預期這些逆風將延續至第四季。

Now, despite these temporary challenges, we like our long-term opportunities. Consumers want bigger screens and more bandwidth and touch everywhere. The demand for cleaner air is accelerating. Our innovation portfolio is rich with opportunities. Given that, I'd like to use my time with you today to introduce our new strategy and capital allocation framework. We believe that the framework provides clearer guidelines to define our portfolio and our commitment to excellent capital stewardship. Tony will then review our third-quarter results. We will conclude by taking your questions.

然而，儘管面臨這些暫時性挑戰，我們仍看好長期機會。消費者希望更大的螢幕、更多的頻寬，以及隨處可用的觸控。對更潔淨空氣的需求正在加速。我們的創新組合蘊含豐富機會。因此，我想利用今天與各位的時間，介紹我們新的策略與資本配置架構。我們相信，該架構能提供更清晰的指引，以界定我們的投資組合，以及我們對卓越資本管理的承諾。接著 Tony 將回顧第三季結果。最後我們將回答各位的提問。

First, it's useful to review our current position. We have delivered outstanding industrial performance. Over the past decade, we have grown sales, NPAT, EPS and operating cash flow at double-digit rates. We have beaten the competition on growth in each of our segments. We have innovated to achieve the lowest cost position in key businesses. We have created new to the world product categories such as Gorilla Glass, our heavy-duty diesel substrates and filters and our customized fiber-to-the-home solutions. As we look forward, our innovation pipeline is full. Taken as a whole, our performance gives us a foundation for sustained cash flow in a tremendous opportunity set.

首先，回顧我們目前的定位很有幫助。我們已交出卓越的工業表現。過去十年，我們的銷售額、NPAT、EPS 與營運現金流皆以兩位數成長。在各個事業部門中，我們的成長都優於競爭對手。我們透過創新，在關鍵業務中達成最低成本的地位。我們創造了多個全球首創的產品類別，例如 Gorilla Glass、重型柴油用載體與濾材，以及客製化的光纖到府（FTTH）解決方案。展望未來，我們的創新管線十分充實。整體而言，我們的表現為在龐大機會集合中持續產生現金流奠定了基礎。

Our leadership priorities for the next four years are simple. We will focus our portfolio and utilize our financial strength. We expect to deploy more than $20 billion through 2019. We plan to distribute at least $10 billion to our shareholders, which is roughly half our current market cap. We will also invest $10 billion in growth in sustained leadership. Today, we are announcing the first steps to deliver our plan. Our Board of Directors has increased our share repurchase authorization by $4 billion. We will execute a $1.25 billion accelerated share repurchase program. We intend to increase our divide per share by at least 10% annually through 2019.

未來四年的領導優先事項很簡單。我們將聚焦投資組合並運用我們的財務實力。我們預期在 2019 年前部署超過 200 億美元。我們計畫至少向股東分配 100 億美元，約相當於我們目前市值的一半。我們也將投入 100 億美元於成長與持續領先。今天，我們宣布落實計畫的第一步。董事會已將庫藏股回購授權額度增加 40 億美元。我們將執行 12.5 億美元的加速庫藏股回購計畫。我們打算在 2019 年前，每年將每股股利至少提高 10%。

Now let's turn to how we will focus our portfolio to deliver strong financial performance and capital stewardship. Our framework focuses our portfolio on a set of reinforcing capabilities with strong interconnections. The core of what we do is invent, make and sell. We create value by inventing category defining products using transformative manufacturing platforms and building strong, trust-based relationships with the world's leading customers. That process has served us well not only for the last decade of outstanding industrial performance, but for more than 160 years. With our new framework, we are seeking to augment that value creation through a more focused and cohesive portfolio that increases our return on innovation.

接下來談談我們將如何聚焦投資組合，以交付強勁的財務表現與資本管理。我們的架構將投資組合聚焦於一組彼此強化、且高度互聯的能力。我們的核心工作是：發明、製造與銷售。我們透過發明能定義品類的產品、運用具變革性的製造平台，並與全球領先客戶建立以信任為基礎的強健關係來創造價值。這套流程不僅在過去十年卓越的工業表現中證明有效，更在 160 多年來一直如此。透過新的架構，我們希望藉由更聚焦且更一致的投資組合來強化價值創造，提升我們的創新報酬。

A moment ago, I said that we have tremendous opportunities. From a shareholder value perspective, the challenge is to select the right opportunities; we apply both financial and strategic criteria to making our selections. Our financial hurdles include market size, return on invested capital and sustainability of margins. Our strategic criteria are about increasing our probability of success and reducing the cost of innovation. We are the best in the world in three core technologies, four manufacturing and engineering platforms and five market access platforms.

剛才我提到我們擁有龐大的機會。從股東價值的角度來看，挑戰在於選對機會；我們在選擇時同時採用財務與策略準則。我們的財務門檻包括市場規模、投入資本報酬率（ROIC）以及利潤率的可持續性。我們的策略準則著重於提高成功機率並降低創新成本。我們在三項核心技術、四個製造與工程平台，以及五個市場進入平台方面，皆屬全球最佳。

Our probability of success increases as we apply more of these best in the world capabilities. Our cost of innovation declines as we reapply our talent and repurpose our assets. Additionally, by combining multiple capabilities, we create higher and more sustainable competitive barriers. Focusing our portfolio means that 80% or more of our resources go to opportunities that use at least two of these three columns. Our framework allows us to direct up to 20% of our resources at opportunities that leverage a single capability. But when we do that, the potential payoff must be dramatically higher because we know the chance of success will be lower.

當我們運用更多這些「全球最佳」能力時，成功機率就會提高。當我們重複運用人才並重新配置資產時，創新成本就會下降。此外，透過結合多項能力，我們能建立更高且更可持續的競爭壁壘。聚焦投資組合意味著，我們 80% 或更多的資源將投入到至少運用這三欄中兩欄能力的機會上。我們的架構也允許最多 20% 的資源投入到僅槓桿單一能力的機會。但在那種情況下，潛在回報必須顯著更高，因為我們知道成功機率會較低。

The framework also means that we will consider removing assets falling outside our core capabilities. While we operate these assets well and they return more than their cost of capital, we recognize that others may find them more synergistic. We will consider transactions that create value for our shareholders. For example, Dow Corning is a great Company that lies outside our core focus. We are currently in discussions with Dow regarding a potential transaction.

此架構也意味著，我們將考慮剝離落在核心能力之外的資產。雖然我們能良好經營這些資產，且其報酬高於資本成本，但我們也認知到其他公司可能能從中獲得更高的協同效益。我們將考慮能為股東創造價值的交易。例如，道康寧（Dow Corning）是一家很優秀的公司，但不在我們的核心聚焦範圍內。我們目前正與 Dow 就潛在交易進行討論。

One of the ways that we maximize our return on innovation is by reapplying our talent and repurposing our manufacturing and market access platforms. Gorilla Glass is a great example. When we developed Gorilla, we reapplied our world class experts in glass science and optical physics to deliver a new to the world product, faster and at lower cost than anyone else in the world could have done.

我們最大化創新報酬的方法之一，是重複運用我們的人才，並重新配置我們的製造與市場進入平台。Gorilla Glass 就是一個很好的例子。在開發 Gorilla 時，我們重新運用世界級的玻璃科學與光學物理專家，交付一項全球首創的產品，速度更快、成本更低，勝過全球任何其他公司所能做到的。

To manufacture Gorilla, we repurposed fusion assets built for our display business, that saved us about $800 million in capital, greatly enhancing Gorilla's ROIC. We were able to reuse technology and manufacturing capabilities. However, at the time Gorilla started, we didn't have a mobile consumer electronics market access platform. Our confidence in our ability to win with Gorilla convinced us to build that platform. It was a smart decision. In the future, we can apply other capabilities such as precision forming or vapor deposition to products like Project Phire and 3D shapes that leverage our mobile consumer electronics market access. This gives us the opportunity to further increase our return on innovation.

為了製造 Gorilla，我們重新配置原本為顯示器業務建置的熔融成形（fusion）資產，為我們節省約 8 億美元的資本支出，大幅提升 Gorilla 的 ROIC。我們得以重複使用技術與製造能力。然而，在 Gorilla 起步之初，我們並沒有行動消費性電子的市場進入平台。我們對 Gorilla 取勝能力的信心，促使我們建立該平台。那是一個明智的決定。未來，我們可以將其他能力（例如精密成形或氣相沉積）應用於 Project Phire 與 3D 造型等產品，並槓桿我們在行動消費性電子的市場進入能力。這讓我們有機會進一步提高創新報酬。

Our approach to leveraging our optical communications market access platforms demonstrates how combining multiple capabilities creates bigger and more sustainable competitive advantages. Using glass science and optical physics, we have reinvented optical fiber multiple times, dramatically increasing its performance and lowering its cost. Ceramic science has helped us improve connectors, a critical point of signal loss in communication systems. We use vapor deposition to make fiber extrusion to make cabling and precision forming to make connectors. We are also exploring the use of fusion to make key components for next generation switches and routers. As a result, our optical communications customers benefit from all three of our core technologies and all four of our manufacturing and engineering platforms.

我們運用光學通訊市場進入平台的方法，展現了結合多項能力如何創造更大且更可持續的競爭優勢。運用玻璃科學與光學物理，我們已多次重新發明光纖，大幅提升其性能並降低成本。陶瓷科學協助我們改善連接器——這是通訊系統中訊號損耗的關鍵點。我們運用氣相沉積來製作光纖、運用擠出來製作纜線，並運用精密成形來製作連接器。我們也在探索運用熔融技術來製作下一代交換器與路由器的關鍵元件。因此，我們的光學通訊客戶可同時受益於我們三大核心技術以及四大製造與工程平台。

Ultimately we want all of our customers to experience all of our capabilities. Now, why is that important? Few competitors can match our expertise in any of our individual focus capabilities. When our products derive value from combinations of capabilities, we build dramatically higher barriers to competition. As a result, we can enjoy market leading positions and margins. Over the next several months, we will be out with investors to share and discuss more examples of how we will apply this framework to Corning's next set of category defining products.

最終，我們希望所有客戶都能體驗我們的全部能力。那麼，為什麼這很重要？幾乎沒有競爭對手能在我們任何一項單一重點能力上與我們的專業相匹敵。當我們的產品價值來自多種能力的組合時，我們就能建立顯著更高的競爭門檻。因此，我們得以享有市場領先的地位與利潤率。在接下來幾個月，我們將與投資人會面，分享並討論更多我們如何將此架構應用於康寧下一批具類別定義性的產品之例子。

But for now, let's turn to our 2016 to 2019 capital allocation model. Our plan is to generate more than $20 billion, with the majority produced by our growing operating cash flow. We will invest $10 billion of the cash in RD&E, CapEx and acquisitions. We will distribute at least $10 billion to shareholders. We are committed to annually increase the dividend at a double-digit rate. We will continue to be opportunistic on share repurchases. As I mentioned earlier, potential transactions may provide upside to shareholder distributions.

不過現在，讓我們轉到2016至2019年的資本配置模型。我們的計畫是創造超過200億美元，其中大部分將由我們成長中的營運現金流所產生。我們將把其中100億美元投資於研發與工程（RD&E）、資本支出（CapEx）以及併購。我們將至少向股東分配100億美元。我們承諾每年以兩位數的成長率提高股利。我們也將持續在股票回購上把握機會、保持彈性。如我先前提到的，潛在交易可能為股東分配帶來上行空間。

So that's our new framework. It reflects the financial and industrial strengths of Corning and our ongoing commitment to create value for shareholders through thoughtful, capital stewardship. We deliver value by creating life changing innovations. We are augmenting our value creation by focusing our portfolio and managing it more cohesively. Along the way, we seek to reward our shareholders with significant and consistent cash distributions. I will now turn the call over to Tony, who will review the third quarter and provide guidance.

以上就是我們的新架構。它反映了康寧的財務與產業優勢，以及我們透過審慎的資本管理持續為股東創造價值的承諾。我們透過創造改變生活的創新來交付價值。我們也透過聚焦並更一致地管理投資組合，來強化價值創造。在此過程中，我們致力於以可觀且穩定的現金分配回饋股東。接下來我將把電話會議交給Tony，由他回顧第三季並提供展望指引。

Thank you, Wendell. Good morning. I would like to begin by highlighting my role in executing our framework over the next four years. As you might expect, my emphasis will be on financial discipline, returns and ensuring we are good stewards of capital. Specifically, I look for us to deliver strong financial results and investment returns, to manage an efficient balance sheet and to lower our cost of capital over time.

謝謝你，Wendell。各位早安。我想先強調我在未來四年執行我們架構中的角色。如各位所預期，我的重點將放在財務紀律、報酬，以及確保我們善盡資本管理者的責任。具體而言，我希望我們能交出強勁的財務成果與投資報酬、管理高效率的資產負債表，並隨時間降低資本成本。

Currently, we use several metrics to evaluate investment returns including net present value, internal rate of return and payback period as well as return on invested capital measured after commercialization. Our disciplined approach to capital allocation and focus on lowest cost have enabled our businesses to have excellent ROIC metrics against their respective industries and well above their cost of capital. Going forward, I will continue to emphasize returns. I expect us to improve our corporate ROIC over the next four years. I look forward to keeping you updated on our financial strength and focus.

目前，我們使用多項指標來評估投資報酬，包括淨現值、內部報酬率與回收期，以及在商業化後衡量的投入資本報酬率（ROIC）。我們在資本配置上的紀律與對最低成本的聚焦，使各事業的ROIC相較其所屬產業表現優異，且明顯高於其資本成本。展望未來，我將持續強調報酬。我預期我們在未來四年將提升公司的整體ROIC。我也期待持續向各位更新我們的財務實力與聚焦重點。

Now let's talk about the quarter. As Wendell said, weakening economies, particularly in China and the stronger dollar, impacted our businesses. For example TV demand is weaker, TV growth in China has slowed, TV demand in Europe, Latin America and Middle East/Africa is softer due to the effect of the stronger dollar on retail prices and continued economic uncertainty. We expect worldwide TV unit sell-through to be down slightly versus last year.

現在我們來談談本季表現。如Wendell所說，經濟走弱——尤其是中國——以及美元走強，影響了我們的業務。例如，電視需求較弱，中國的電視成長已放緩；由於美元走強推升零售價格的影響，以及持續的經濟不確定性，歐洲、拉丁美洲與中東／非洲的電視需求也較疲軟。我們預期全球電視終端銷售量（sell-through）將較去年小幅下滑。

IT and mobile demand is weaker, driven by lack of replacement drivers, the strong dollar and continued economic uncertainty. We expect the worldwide IT market to be down 10% this year and smartphone sales in China to be flat versus last year. China's auto and heavy-duty truck production has slowed through the year. China's auto production is now expected to be flat year over year. Heavy-duty truck production is down 34% year to date.

IT與行動裝置需求較弱，主因是缺乏換機動能、美元走強以及持續的經濟不確定性。我們預期今年全球IT市場將下滑10%，而中國智慧型手機銷量將與去年持平。中國汽車與重型卡車的產量在今年以來已放緩。目前預期中國汽車產量將與去年持平。重型卡車產量年初至今下滑34%。

Finally, the growth rate of China fiber optic market is half of what it was last year. Despite these macroeconomic headwinds, we are encouraged by several trends that support our long-term success. We are pleased with the improving pricing environment in display. The market for cover glass is expected to be up 10% this year. We are gaining share in China and touch notebooks. We expect to extend our long-term supply agreement with one of our largest LCD customers to 2025. Optical communications is expected to deliver another year of double-digit sales growth.

最後，中國光纖市場的成長率僅為去年的一半。儘管面臨這些總體經濟逆風，我們仍受到數項支持我們長期成功的趨勢所鼓舞。我們對顯示器業務的定價環境改善感到滿意。今年蓋板玻璃市場預期將成長10%。我們在中國以及觸控筆電領域的市占率正在提升。我們預期將把與我們最大LCD客戶之一的長期供應協議延長至2025年。光學通訊預期將再度實現一年兩位數的銷售成長。

Now let's get into third-quarter financials. As a reminder, these are core results. In total, sales in the quarter were $2.5 billion, down 5% versus last year. As expected, the stronger dollar reduced sales in the third quarter by $57 million versus a year ago. Without this impact core sales would have been down 3%. Sales in the quarter were lower than expected due to lower volume of LCD glass, lower sales of environmental products in China and lower sales in optical communications.

現在我們來看第三季財務數據。提醒各位，這些是核心（core）結果。整體而言，本季銷售額為25億美元，較去年下滑5%。如預期，美元走強使第三季銷售額較一年前減少5,700萬美元。若不計此影響，核心銷售額將下滑3%。本季銷售低於預期，原因是LCD玻璃出貨量較低、中國環保產品銷售較低，以及光學通訊銷售較低。

Corporate gross margin was 42% which is lower than we expected, driven by the sales components I just described. Most of our businesses have a relatively high fixed cost structure; therefore, decreased sales lower our gross margin as a percent of sales. I will cover the specifics when I talk about each segment. S&A and RD&E were down versus last quarter and last year in absolute dollars, driven by a compensation accrual adjustment. Net income was down 15% versus last year; one-third of the decline was driven by foreign exchange rates including the devaluation of the RMB. EPS was $0.34, down 8% versus last year.

公司毛利率為42%，低於我們的預期，主要受我剛才所述銷售組成因素影響。我們多數業務具有相對較高的固定成本結構；因此，銷售下滑會使毛利率（占銷售額百分比）下降。我在談到各事業部時會說明細節。銷售與管理費用（S&A）及研發與工程（RD&E）相較上季與去年，在絕對金額上皆下降，主因是薪酬應計調整。淨利較去年下滑15%；其中三分之一的降幅來自外匯匯率變動，包括人民幣貶值。每股盈餘（EPS）為0.34美元，較去年下滑8%。

Now, let's look at the detailed segment results beginning with display technologies. Display sales were $936 million in Q3, down 11% versus last year. Sequentially, third-quarter price declines were moderate as expected. We are very pleased that the LCD glass pricing environment has been improving for more than a year. We expected panel makers to adjust utilizations in the second half in response to the softer end market I already mentioned, but we weren't sure how much would be in Q3 versus Q4.

現在，讓我們從顯示科技事業開始，檢視各事業部的詳細結果。第三季顯示器銷售額為9.36億美元，較去年下滑11%。就季比而言，第三季價格下滑幅度如預期屬溫和。我們非常高興看到LCD玻璃的定價環境已改善超過一年。我們原本預期面板廠會在下半年因應我先前提到的較疲弱終端市場而調整稼動率，但我們不確定調整幅度在第三季與第四季之間的分布會如何。

Sell-through data indicates TV and IT demand in many regions was weaker than our expectations entering the quarter. Panel price declines accelerated during the quarter. Panel makers adjusted utilizations, especially small [gem] sizes where prices hit cash cost. Therefore, the glass market was flat sequentially in Q3. At Corning, our volume was down slightly sequentially because of temporary share loss at one of our largest customers due to a contract dispute. The good news is that we have resolved the dispute amicably and expect to extend our long-term supply agreement to 2025 and for our share levels to be in line with the first half of 2015. We also expect to make up the missed volume in the fourth quarter. Net income was down 15% year over year and reflects that the expected year-over-year price declines were only partially offset by volume growth, cost reductions and synergies from CPM.

銷售穿透（sell-through）數據顯示，許多地區的電視與 IT 需求較我們在本季初的預期更疲弱。面板價格下跌在本季加速。面板廠調整稼動率，尤其是小尺寸 [gem]，其價格已跌至現金成本水準。因此，第三季玻璃市場較前一季持平。在康寧，我們的出貨量較前一季略降，原因是與我們最大客戶之一因合約爭議導致短期市占流失。好消息是，我們已友好解決該爭議，並預期將長期供應協議延長至 2025 年，且我們的市占水準將與 2015 年上半年一致。我們也預期在第四季補回錯失的出貨量。淨利年減 15%，反映預期的年對年價格下跌僅部分被出貨量成長、成本降低以及 CPM 的綜效所抵銷。

Now, for optical communications. Sales were up 7% versus last year, driven by acquisitions and moderate growth in North America fiber-to-the-home and data centers. Even though we saw growth in carrier sales, it was less than expected in Canada and Asia due to timing delays of certain fiber-to-the-home projects. In addition, we had an enterprise customer adjust inventory. Net income was up only 1% versus last year, which is lower than we would normally realize with 7% sales growth. We expected more sales in higher margin fiber-to-the-home solutions and maintain cost structures in place to service that demand. In addition to the cost impact, a lower mix of high margin fiber-to-the-home meant a higher percentage of our sales growth came from lower margin businesses like our newly acquired Korean operation.

接著談光學通訊。銷售額較去年成長 7%，主要由併購帶動，以及北美光纖到府（FTTH）與資料中心的溫和成長所驅動。儘管我們看到電信業者銷售成長，但由於部分 FTTH 專案時程延後，加拿大與亞洲的成長低於預期。此外，我們有一位企業客戶調整庫存。淨利僅較去年成長 1%，低於我們在銷售成長 7% 時通常可實現的水準。我們原本預期高毛利的 FTTH 解決方案銷售會更多，並維持相應的成本結構以服務該需求。除了成本影響外，高毛利 FTTH 的占比降低，意味著我們銷售成長中有較高比例來自毛利較低的業務，例如我們新併購的韓國營運。

In environmental, Q3 sales were $257 million, down 9% or $25 million versus last year. Foreign exchange drove $14 million of the decline. Soft demand in China drove the remaining decline and the miss versus expectations. In North America and Europe, we saw solid growth for our light-duty substrates and continued strong demand for heavy-duty diesel products. Profitability was down more than sales, driven mostly by the softer demand in China for both light-duty and heavy-duty products. We recently built capacity for growth in China, which has added extra cost that was not covered during the quarter by demand.

在環境事業方面，第三季銷售額為 2.57 億美元，較去年減少 9% 或 2,500 萬美元。匯率因素造成其中 1,400 萬美元的下滑。中國需求疲弱造成其餘下滑，並導致低於預期。在北美與歐洲，我們的輕型車用載體（substrates）呈現穩健成長，重型柴油產品需求亦持續強勁。獲利下滑幅度大於銷售下滑，主要由於中國輕型與重型產品需求轉弱。我們近期在中國建置成長產能，增加了額外成本，而本季需求不足以吸收該成本。

Moving on to specialty materials. We are pleased with our Gorilla Glass business. The market for cover glass is expected to be up 10% this year. We are gaining share in China and touch notebooks. Gorilla Glass volume up was sequentially and consistent with last year's strong Q3, driven by demand at customers ahead of new product launches. We are pleased with the fast adoption rate of Gorilla Glass 4 by our customers and its favorable impact on our average selling price. Overall segment sales were down 12% versus last year. Advanced optics year-over-year sales remained weak, driven by softness at our semiconductor customers. Year-to-date, AO sales are down almost 20%. Segment net income was down 17% mainly due to the lower sales in advanced optics.

接著談特殊材料。我們對 Gorilla Glass 業務表現感到滿意。今年蓋板玻璃市場預期成長 10%。我們在中國與觸控筆電領域的市占正在提升。Gorilla Glass 出貨量較前一季增加，且與去年強勁的第三季一致，主要由客戶在新產品上市前的需求所帶動。我們很高興客戶快速採用 Gorilla Glass 4，並對我們的平均售價帶來正面影響。整體事業部銷售額較去年下滑 12%。先進光學（Advanced Optics）年對年銷售仍然疲弱，主要受半導體客戶需求轉弱影響。年初至今，AO 銷售下滑近 20%。事業部淨利下滑 17%，主要因先進光學銷售較低。

In life sciences, Q3 sales were $211 million. Both sales and net income were down slightly year over year, driven by foreign exchange. Net income would have increased mid-teens without the impact of the exchange rates.

在生命科學方面，第三季銷售額為 2.11 億美元。銷售額與淨利均較去年略降，主要受匯率影響。若不計匯率影響，淨利本可呈現約十幾個百分點的成長。

Equity earnings from Dow Corning were $53 million. This is down 22% versus last year, due to the absence of a one-time tax benefit recorded in Q3 2014 and the impact of the slowing Chinese economy.

來自 Dow Corning 的權益法投資收益為 5,300 萬美元。較去年下滑 22%，原因是 2014 年第三季認列的一次性稅務利益不再出現，以及中國經濟放緩的影響。

Let's turn to our balance sheet and cash flow. We delivered free cash flow in the quarter of $566 million. Our pace of capital spending was down in Q3. We now expect to spend approximately $1.3 billion for the full year. During the quarter, we spent $827 million on share repurchases. This sequential 32% increase reflects our view that given the Company's current performance and future outlook, Corning shares are a very attractive investment opportunity.

接著看資產負債表與現金流。本季我們創造的自由現金流為 5.66 億美元。第三季資本支出步調放緩。我們目前預期全年資本支出約為 13 億美元。本季我們用於庫藏股回購的支出為 8.27 億美元。較前一季增加 32%，反映我們認為在公司目前表現與未來展望下，康寧股票是非常具吸引力的投資機會。

As Wendell mentioned, the Board has increased our share repurchase authorization by $4 billion as part of our plan to return greater than $10 billion to shareholders over the next four years. We will be in the market repurchasing shares both programatically and opportunistically over this time period. We will execute on a $1.25 billion accelerated share repurchase program during the quarter. We ended the quarter with $5 billion of cash, with approximately $2 billion in the United States.

如 Wendell 所提到，董事會已將我們的股票回購授權額度增加 40 億美元，作為未來四年向股東回饋超過 100 億美元計畫的一部分。在此期間，我們將以系統性與機會性方式在市場上回購股票。我們將於本季執行 12.5 億美元的加速股票回購（ASR）計畫。本季末我們持有 50 億美元現金，其中約 20 億美元在美國境內。

Now for the outlook. We expect the global economic headwinds to persist in the fourth quarter and impact most of our businesses year over year. Let's begin our business outlook with the display market. As I mentioned a few minutes ago, we see continued softness in both TV and IT markets. This impacts full-year retail growth and supply chain inventory. Given the lower end market and the level of inventory at set makers, we expect panel makers to further reduce utilization rates in Q4 and likely into Q1. Our timing on how quickly panel makers reduce utilization could be off and depends on how rapidly panel prices decline. Lower utilization will help draw down absolute inventory during the stronger retail season.

接著談展望。我們預期全球經濟逆風將在第四季持續，並在年對年比較下影響我們多數業務。先從顯示器市場的業務展望談起。如我幾分鐘前提到的，我們看到電視與 IT 市場持續疲弱。這會影響全年零售成長與供應鏈庫存。鑑於終端市場較弱以及整機廠的庫存水位，我們預期面板廠在第四季、且很可能延續到第一季，將進一步降低稼動率。我們對面板廠降低稼動率的速度判斷可能有偏差，並取決於面板價格下跌的速度。較低稼動率將有助於在較強的零售旺季期間降低絕對庫存。

Now, for the LCD glass industry in the fourth quarter. We expect glass market volume to be down low single-digits sequentially and our sales volume to be down only slightly because we believe we will make up the Q3 share loss at one of our largest customers, due to favorable resolution of the contract dispute.

接著談第四季 LCD 玻璃產業。我們預期玻璃市場出貨量較前一季下滑低個位數百分比，而我們的銷售出貨量僅會小幅下滑，因為我們相信，隨著合約爭議獲得有利解決，我們將能在最大客戶之一補回第三季流失的市占。

In July, we told investors we had levers to control our capacity to demand. We are keeping our capacity off-line to match supply to demand by leaving tanks down after repairs and by allocating capacity for development trials. With the lower panel maker utilizations in Q4 likely to continue into Q1, we will manage the startup of tanks down for scheduled repairs to match Q1 supply to demand. We expect glass market supply and demand to remain balanced as we will continue to control our capacity to our demand. Other glass suppliers have said publicly that they have levers to take similar actions.

7 月時，我們告訴投資人我們有槓桿可將產能控制在符合需求的水準。我們透過維修後讓熔爐（tanks）維持停線，以及將部分產能分配給開發試產，來使產能離線，以讓供給與需求匹配。在第四季面板廠較低稼動率可能延續到第一季的情況下，我們將管理因例行維修而停線的熔爐重啟時點，以使第一季供給與需求匹配。我們預期玻璃市場供需將維持平衡，因為我們會持續依需求控制產能。其他玻璃供應商也已公開表示，他們有槓桿可採取類似行動。

Finally, I will outline our expectations for LCD glass prices. We expect price declines to further moderate in the fourth quarter. This expectation is based on the customer input we have already received about the prices offered by other suppliers for this quarter. Recall that, under some of our contracts, our price movement at the customer depends on price movements that were made by comparable suppliers at that customer. These price movements by these suppliers at these customers define the price movement for a substantial portion of our sales.

最後，我將說明我們對 LCD 玻璃價格的預期。我們預期第四季價格下跌將進一步趨緩。此預期基於我們已收到的客戶回饋，內容涉及其他供應商在本季所提供的報價。請記得，在我們部分合約下，我們對客戶的價格變動取決於該客戶處可比供應商所做的價格變動。這些供應商在這些客戶處的價格變動，決定了我們相當大一部分銷售的價格變動。

For Q4, because we have already been told how these other suppliers' prices moved, we are confident that our overall price decline will be even less in Q4 than it was in Q3. Additionally, we do not expect that our Q4 pricing will be affected by customers moving from thick to thin. We do not expect our pricing to be significantly effected by the weaker than anticipated glass demand. Last, price declines have been below historic levels for the last 12 months.

就第四季而言，由於我們已經得知其他供應商的價格變動情況，我們有信心第四季的整體降價幅度將比第三季更小。此外，我們不預期第四季的定價會受到客戶由厚轉薄的影響。我們不預期定價會因玻璃需求弱於預期而受到顯著影響。最後，過去12個月的降價幅度一直低於歷史水準。

As we have previously explained, we expect this more favorable pricing environment to continue and maybe even improve for several reasons. First, the financial situation at our competitors indicate that they cannot continue historical price declines and remain profitable. Second, the significant weakening of the Japanese yen has in itself given our customers a significant economic benefit without any decline in the yen price of our glass. Third, as we've said before, we believe that glass supply and demand will remain balanced throughout this recent weakening in panel demand. For these and other reasons, we continue to believe that our quarter-over-quarter price comparison will be better for us going forward than they have been in the past. However, as we explained, our glass price movements depend in large part on what is decided between some of our customers and our competitors.

如同我們先前所說，我們預期這個較有利的定價環境將會延續，甚至可能因數個原因而進一步改善。第一，競爭對手的財務狀況顯示，他們無法在維持獲利的同時，繼續過去那種歷史性的降價。第二，日圓大幅走弱本身就已在我們玻璃日圓價格未下調的情況下，為客戶帶來顯著的經濟利益。第三，如同我們之前所說，我們相信在面板需求近期走弱期間，玻璃供需仍將維持平衡。基於這些及其他原因，我們仍相信，未來我們的季對季價格比較將比過去更有利於我們。然而，如我們所解釋，我們的玻璃價格變動在很大程度上取決於部分客戶與競爭對手之間所做的決定。

So to summarize display, we expect our volume in Q4 and likely into Q1 2016 to reflect the weaker retail market. We will manage our supply to demand. We expect the improved pricing environment to continue. We do not believe that the current economic environment reflects any fundamental change to the longer-term drivers of TV demand. We continue to expect excellent long-term demand, driven by the replacement of older sets and technology innovations such as 4K TV.

因此總結顯示業務，我們預期第四季的出貨量，以及很可能延續到2016年第一季，將反映較疲弱的零售市場。我們將依需求管理供給。我們預期改善的定價環境將會持續。我們不認為目前的經濟環境反映了電視需求長期驅動因素的任何根本性改變。我們仍預期長期需求表現優異，主要由汰換舊機與4K電視等技術創新所帶動。

Moving to optical communications. For the fourth quarter, we expect sales to be up low to mid single-digits versus last year as certain project delays continue. We expect projects to be on track next year. Looking at the full-year 2015, we expect another strong growth year with sales up 10% or low teens if you exclude the impact of the stronger dollar. These results are further confirmation of our fundamental growth outlook for our optical communications business over the next several years.

接著談光通訊。第四季我們預期，由於部分專案延遲仍在持續，銷售額相較去年將成長低至中個位數百分比。我們預期這些專案明年將回到正軌。就2015年全年而言，我們預期將再度是強勁成長的一年，銷售額成長10%，若排除美元走強的影響則為低十位數百分比。這些結果進一步印證我們對未來數年光通訊業務基本面成長前景的看法。

Turning to environmental, we expect sales to be down mid single-digits year over year driven by the weaker euro and continued softness in China. In specialty materials, we expect Gorilla Glass volume to be down about 10% sequentially and year over year, reflecting the differences in new product launch timing and supply chain builds at major brands versus last year. We expect Gorilla Glass 4 to be a significant portion of glass volume in the quarter. We are pleased with the performance of Gorilla Glass and expect double-digit profit growth this year. While advanced optic sales are improving sequentially, we expect continued weakness on a year-over-year basis. Overall, we expect total segment sales to be down low teens year over year.

再來看環境科技，我們預期在歐元走弱及中國持續疲軟的帶動下，銷售額年減中個位數百分比。在特殊材料方面，我們預期Gorilla Glass出貨量將較前一季及去年同期下降約10%，反映與去年相比，各大品牌新產品上市時點及供應鏈備貨節奏的差異。我們預期Gorilla Glass 4將占本季玻璃出貨量的相當大比重。我們對Gorilla Glass的表現感到滿意，並預期今年獲利將呈現兩位數成長。雖然先進光學產品銷售較前一季改善，我們預期在年對年基礎上仍將持續疲弱。整體而言，我們預期該事業群總銷售額年減低十位數百分比。

In life sciences, we expect sales to be down mid single-digits versus last year, driven by the weaker euro. Without the foreign exchange impact, sales are expected to be consistent with Q4 of last year.

在生命科學方面，我們預期銷售額較去年下降中個位數百分比，主要受歐元走弱所致。若不計匯率影響，銷售額預期將與去年第四季大致一致。

Now, continuing with the rest of fourth-quarter forecast. We expect Q4 equity earnings from Dow Corning to be approximately $80 million. This is up from Q3 due to polysilicon customers meeting annual contract obligations. We expect gross margin to be approximately 42% consistent with last quarter. This is approximately 1.5 points lower than Q4 last year. As a reminder, corporate gross margin is really an average of five separate businesses. In Q4, display is lower as a percent of the total Company, which will impact the corporate average gross margin but display's business percent gross margin is consistent with last year's Q4. Other drivers of the decline are in optical and environmental, where we have cost structures in place for expected growth. As I just said, softness in demand is continuing in Q4. We do expect these businesses to grow in 2016. If they don't, we have levers to adjust costs.

接下來繼續說明第四季其餘的預測。我們預期第四季來自Dow Corning的權益法收益約為8,000萬美元。這較第三季增加，原因是多晶矽客戶履行年度合約義務。我們預期毛利率約為42%，與上季一致。這約比去年第四季低1.5個百分點。提醒一下，公司整體毛利率其實是五個獨立事業的平均。第四季中，顯示事業占公司總體比重較低，將影響公司平均毛利率，但顯示事業本身的毛利率百分比與去年第四季一致。其他造成下滑的因素在於光通訊與環境科技，我們已建立成本結構以支撐預期的成長。如我剛才所說，第四季需求疲軟仍在持續。我們確實預期這些業務在2016年成長。如果沒有成長，我們也有槓桿可以調整成本。

SG&A and RD&E spending will be approximately 14% and 8% of sales, respectively. We expect other income, other expense to be a net expense of approximately $50 million. We expect our effective tax rate for 2015 to be in the range of 16% to 17%. That concludes our outlook for the fourth quarter. Now, I will hand the call over to Wendell to summarize before we go to Q&A.

SG&A與RD&E支出分別約占銷售額的14%與8%。我們預期其他收入、其他費用合計為淨費用約5,000萬美元。我們預期2015年的有效稅率將落在16%至17%的區間。以上為我們對第四季的展望。接下來我把電話交給Wendell，在進入問答前做個總結。

Thank you, Tony. To sum up, economic headwinds are impacting our business, but our strong opportunity set, the more stable LCD pricing environment and our ability to generate cash even in a challenging economy provide a foundation for continued outstanding industrial performance. As we focus our portfolio and utilize our financial strength, we expect to build on our best in the world capabilities to deliver growth and significant sustained cash distributions to our shareholders.

謝謝你，Tony。總結來說，經濟逆風正在影響我們的業務，但我們強勁的機會組合、更穩定的LCD定價環境，以及即使在具挑戰性的經濟情勢下仍能創造現金的能力，為我們持續卓越的產業表現提供了基礎。隨著我們聚焦投資組合並運用財務實力，我們預期將在全球領先的能力基礎上，實現成長並向股東提供可觀且可持續的現金分配。

Our framework, intent to increase the dividend at a double-digit rate and accelerated share repurchase program are important steps in our four-year plan. Over the next several months, we will be out with investors to share more details. We really look forward to the dialogue. Ann?

我們的架構、以兩位數幅度提高股利的意圖，以及加速的庫藏股回購計畫，都是我們四年計畫中的重要步驟。在接下來幾個月，我們將與投資人會面，分享更多細節。我們非常期待這些交流對話。Ann？

Thank you, Tony and Wendell. Operator, we will now open the lines for questions.

謝謝你，Tony和Wendell。接線員，我們現在開放提問。

(Operator Instructions)

（接線員指示）

Rod Hall, JPMorgan.

Rod Hall，摩根大通。

I guess I wanted to kick off with a question about the capital program and specifically, the $10 billion beyond the capital returns, so the $10 billion that you're going to invest in the business. Wendell, I know you lined out the three core technologies, four manufacturing engineering platforms, five market access platforms that you're going to be investing in, but can you give us any more detail on how that $10 billion or maybe a little less than $10 billion will be deployed? Against what strategic initiatives? Then any other sort of background on this strategic thinking change? How it developed and so on would be helpful. Thanks. I have one follow-up.

我想先從資本計畫的問題開始，特別是資本回饋之外的100億美元，也就是你們將投資於業務的那100億美元。Wendell，我知道你列出了將投資的三項核心技術、四個製造工程平台、五個市場進入平台，但你能否提供更多細節，說明這100億美元（或可能略低於100億美元）將如何配置？會對應哪些策略性倡議？另外，關於這次策略思維轉變的其他背景資訊，例如它如何形成等等，也會很有幫助。謝謝。我還有一個追問。

Great. Thanks for the question, Rod. I'll deal with the first one first, second, second. As far as sharing how we will deploy the $10 billion that we are going to invest in our growth and sustained leadership, we will be sharing more in the future about how we think about that allocation, towards which of the various platforms we are going to be leaning. But we'd like to do that as we engage with folks like you and our investors, over the coming months. There will be pieces of it, which are still in stealth that we won't be able to share. But we will be able to give you a pretty good idea of where you can expect to see us place our emphasis.

好的。謝謝你的問題，Rod。我先回答第一個，第二個留到後面。至於分享我們將如何部署這100億美元、用於成長與持續領導地位的投資，我們未來會進一步說明我們如何看待這些配置，以及會偏重哪些不同的平台。但我們希望在接下來幾個月，與像你以及我們的投資人互動時再來談這些。其中有些部分仍處於保密狀態，我們無法分享。不過，我們可以讓你對我們將把重點放在哪些方向有相當清楚的概念。

Now, to why now? Really is your question -- so really, it's three things that are leading us to discuss this at this point in time. The first is, as you know, we have a pretty strong engineering and scientific culture here. What that means is that we have hypotheses and we test them with controls. So the core of the hypothesis here is that we can increase our return on innovation through focus on our three, four, five plan.

那麼，為什麼是現在？這確實是你的問題——所以，真正促使我們在此時此刻討論這件事的原因有三點。第一點是，如你所知，我們這裡有相當強的工程與科學文化。這代表我們會提出假設，並用對照組來驗證。因此，這裡的核心假設是：透過聚焦於我們的三、四、五計畫，我們可以提高創新投資報酬。

We have been running experiments to prove that hypothesis; that also takes a control. So we have been looking side by side, we have analyzed the data and what we are able to conclude is that we do see a much higher return on innovation when we use the portfolio as we've just described. That increasing productivity of the portfolio helps get at the next two items. The second reason that we are talking about today is we had to be confident that we could sustain our cash flows, even in a time when the economy wasn't going our way.

我們一直在進行實驗來證明這個假設；而這也需要對照組。所以我們一直做並排比較、分析數據，而我們能得出的結論是：當我們採用剛才描述的投資組合方式時，確實能看到更高的創新投資報酬。投資組合生產力的提升，有助於推進接下來兩點。第二個我們今天談這件事的原因是：我們必須有信心，即使在經濟不利於我們的時候，也能維持現金流。

We are really confident that we can do that, Rod. Then finally, and perhaps most importantly, when you focus a portfolio, you have to be really sure that there's enough opportunity set in that portfolio to generate a lot of growth. Where we are right now is very confident in that; the amount of pull from our customer base that makes use of our three, four, five capability sets is quite high.

Rod，我們對此非常有信心。最後，也是或許最重要的一點是：當你聚焦一個投資組合時，你必須非常確定該投資組合中有足夠的機會集合（opportunity set）來帶動大量成長。就我們目前的狀況而言，我們對此非常有信心；客戶群對我們三、四、五能力組合的拉動力相當高。

So really those are the three reasons you're hearing from us today. We have run the experiments, the data is in, the probability of success goes up, cost of innovation goes down and our competitive advantages go up when we apply it. We are confident we can sustain our cash flow, even in times of economic uncertainty and our opportunity set is big enough that we can benefit from focusing.

所以，這就是你今天從我們這裡聽到的三個原因。我們已經做過實驗，數據也出來了；當我們加以運用時，成功機率上升、創新成本下降，而我們的競爭優勢提升。我們有信心即使在經濟不確定的時期也能維持現金流，而且我們的機會集合夠大，能從聚焦中受益。

Okay. Thanks, Wendell. Then my follow-up was on display. I mean, little more short-term, those numbers were actually better than we expected, maybe we were too pessimistic, but I wanted to just see if internally, the display results in Q3 were better than you guys were anticipating? Also, if you could comment on how 4K demand is going at this stage, I would appreciate that. Thanks.

好的。謝謝你，Wendell。那我接著想追問的是關於顯示器（display）。我的意思是，偏短期來看，那些數字其實比我們預期的好，也許我們太悲觀了；但我想確認一下，就內部而言，你們是否也覺得第三季顯示器的結果優於你們原先的預期？另外，如果你們能評論一下目前4K需求的進展，我會很感謝。謝謝。

So, Rod, no, these numbers actually were a little bit worse than what we had expected. When we began the quarter, we thought volumes would be up sequentially and they weren't. Now some of that, of course, was the contract dispute that I talked about. But the rest of it was -- panel maker utilization went down a little bit more than we expected. The reason it did was our expectations for the end market came down during the quarter.

Rod，不是，這些數字其實比我們預期的稍微差一些。在季度開始時，我們以為出貨量會季比上升，但並沒有。當然，其中一部分原因是我提到的合約爭議。但其餘原因是——面板廠的稼動率下降得比我們預期更多一些。之所以如此，是因為我們對終端市場的預期在本季期間下修了。

Those expectations came down -- as evidence came in that TV demand was going to be lower in the -- for the full year than we had thought it was going to be. That was also true from an IT demand standpoint. I think in the call last time, we talked about how we could be wrong on this and it could come down further in Q3. That's actually what happened than what we had originally anticipated.

這些預期之所以下修——是因為有證據顯示，電視需求在——就全年而言會比我們原先想的更低。從IT需求的角度來看也是如此。我想在上次電話會議中，我們談到我們可能會看錯，而它可能在第三季進一步下滑。實際發生的情況就是如此，比我們原先預期的還要更弱。

4K?

4K呢？

So 4K continues to track in a way that we like. Now, actually, where we are starting to turn a hunk of our focus is, what version of 4K can create a -- the most compelling package for our customers and that is with the added quantum dock technology as well. But we're really liking the way the sets are looking, the improvements from a performance standpoint.

4K的走勢仍然符合我們的期待。其實，我們現在開始把一大部分焦點轉向：哪一種版本的4K能為客戶打造——最具吸引力的整體方案，而那會結合額外的量子碼頭（quantum dock）技術。但我們確實很喜歡這些機種的呈現效果，以及在性能面向的改善。

It's still too early to call the bend in the curve; right? Where it's going to drive replacement cycles. We got an awful lot of noise in the marketplace with the really strong dollar -- sort of an economic headwind. So the data just isn't screaming at us yet, that we've got that driving replacement cycle feature. But, gosh, you can't help but look at these things technically and really like what you're seeing.

現在要判斷曲線是否出現轉折還太早；對吧？也就是它是否會帶動換機週期。市場上有非常多雜訊，尤其是強勢美元——某種程度上的經濟逆風。所以目前數據還沒有非常明確地告訴我們：它已具備帶動換機週期的特徵。但老天，從技術角度看這些產品，你很難不喜歡你所看到的。

Okay. Great. Thank you, guys.

好的。很好。謝謝各位。

Mark Sue, RBC Capital Markets.

RBC Capital Markets 的 Mark Sue。

Thank you for the focus on shareholders being stewards of capital. When I look at the step function jump in cash returns in a tougher macro environment, is part of the framework to get that return on innovation potentially consolidating cash generating businesses and focusing on higher improved ROIC? For example, if I look at what, according to what's done in display glass, going after -- both maintaining share and then seeing a lift in industry profits. Is that the framework we should see in the other segments such as telecom and diesel, for example? That would be helpful.

謝謝你們把焦點放在股東、作為資本的受託管理者（stewards of capital）。當我看到在更艱難的總體環境下，現金回饋出現階梯式跳升（step function jump），這個架構的一部分是否是：為了提高創新投資報酬，可能去整併能產生現金的業務，並聚焦於更高、改善後的ROIC？例如，如果我看顯示玻璃（display glass）所做的事情——一方面維持市占，同時看到產業獲利提升。我們是否也應該在其他事業部門（例如電信與柴油）看到同樣的架構？這會很有幫助。

I think the short version is yes. You're going to see us use that type of tool. Especially in telecom, we think we have a lot of potential leverage that looks just like that. So that is one of the things we are going to do as we deploy that $10 billion.

我想簡短的答案是：是的。你會看到我們使用那類工具。尤其在電信方面，我們認為有很大的潛在槓桿，樣貌就跟你描述的非常類似。所以，當我們部署那100億美元時，這會是我們要做的事情之一。

That's helpful. When we consider potential asset sales, how should we frame the tax implications considering the JV, I think began before most of us were born? (laughter) Is there a large capital gains tax that we should consider? Would there be major depreciation recapture involved as well? So maybe the framework as you potentially divest some assets that began a long time ago?

這很有幫助。當我們考慮潛在的資產出售時，鑑於合資企業（JV）我想是在我們大多數人出生之前就開始了，我們應該如何看待稅務影響？（笑聲）是否有很大的資本利得稅需要考量？另外也會涉及重大的折舊回收（depreciation recapture）嗎？所以，當你們可能處分一些很久以前就開始的資產時，能否談談這個思考框架？

So, Mark, first, thank you for not making me feel old today. Usually, I feel a little bit old, but you're right, we've got some stuff that we started before I was born, which is like nice. All I do is work with young people these days. So I normally feel old. But anyway, I digressed. So as far as Dow Corning goes, we are not going to discuss any further than that we have a potential transaction under discussion with our good friends at Dow.

Mark，首先，謝謝你今天沒有讓我覺得自己很老。通常我會覺得有點老，但你說得對，我們確實有一些事情是在我出生之前就開始的，這還挺不錯的。我現在整天都在跟年輕人一起工作。所以我通常會覺得自己老了。不過我扯遠了。至於 Dow Corning，我們不會進一步討論，除了說我們正與我們在 Dow 的好朋友就一項潛在交易進行討論。

Shifting gears and talking about transactions in general and what happens to our out-of-focus assets. So our out-of-focus assets. As I said, we are running them pretty well. They are generating higher than their cost of capital in terms of returns, but we think that some of these assets may offer more synergy to others, if we can realize that synergy including any friction costs that may be involved one way or the other.

換個話題，談一般性的交易，以及我們那些非聚焦資產會怎麼處理。也就是我們的非聚焦資產。如我所說，我們把它們經營得相當好。就報酬而言，它們創造的回報高於其資本成本，但我們認為其中一些資產若由其他方持有，可能能產生更高的綜效；前提是我們能實現該綜效，並把可能涉及的各種摩擦成本（friction costs）一併納入考量，不論是哪一方承擔。

For our shareholders, those are the transactions we are willing to consider. As you take a look at the overall framework of being able to deploy $20 billion; right? Investing in our growth and back to our shareholders, any transactions in any of the areas we are talking about will represent upside to that deployment. So thanks, Mark, for making me feel younger.

對我們的股東而言，這些就是我們願意考慮的交易。當你看整體架構——能夠部署200億美元；對吧？一方面投資成長，一方面回饋股東；我們在所談及任何領域所進行的任何交易，都將代表對該部署的額外上行空間。所以謝謝你，Mark，讓我覺得自己更年輕。

That's helpful. One last question. If we look at the cost of debt, which is at low levels at the moment, any thoughts on the framework for adding more debt to the balance sheet considering that you still want to maintain your credit rating?

這很有幫助。最後一個問題。如果我們看目前處於低檔的債務成本，對於在仍希望維持信用評等的前提下，增加資產負債表負債的框架，您有什麼想法？

So clearly, I think over the next three or four years, we will be adding debt to the balance sheet. We are not prepared now to talk about what the timing of that is. In terms of when we need to do it; right now, we have good cash balances, $5 billion including $2 billion offshore. So we are currently working to try to determine what that is. But keep in mind that our objective is to have debt balances of 2X our EBITDA. Over the next few years, we will be putting debt on to do that.

很明顯，我認為在接下來三到四年，我們會在資產負債表上增加負債。我們目前還不準備談論其時點。就我們何時需要這麼做而言；目前我們的現金餘額充裕，合計50億美元，其中20億美元在海外。所以我們正在努力釐清具體安排。但請記住，我們的目標是讓負債餘額達到EBITDA的2倍。未來幾年，我們會增加負債以達成這個目標。

That's helpful. Thank you. Good luck.

這很有幫助。謝謝。祝你好運。

Thanks, Mark.

謝謝你，Mark。

Vijay Bhagavath, Deutsche Bank.

Deutsche Bank 的 Vijay Bhagavath。

A bigger picture question for you, Wendell, which is what gets you impatient about the business? Are there any areas or parts of the business that you'd see -- you would like to see progress quicker or in a different way than you're seeing now? It would be very helpful to hear your points. Then a quick follow-on for Tony.

Wendell，我想問一個更宏觀的問題：在業務上，什麼事情會讓你感到不耐煩？是否有任何領域或業務部分，你希望看到比現在更快、或以不同方式推進的進展？很希望聽到你的看法。接著我還有一個給 Tony 的簡短追問。

Well, the short answer to your first question is, yes. (laughter) There are many things that make me feel impatient; right? About making progress. But in general, I think the most significant source of frustration these days is that as we use our three, four, five plan and we apply our core technology sets in our manufacturing and engineering platforms and our market access platforms, when we try to introduce a new product to a customer who knows us well in other areas, sometimes we forget that different industries move at different speeds.

嗯，對你第一個問題的簡短答案是：有。（笑聲）有很多事情會讓我感到不耐煩，對吧？關於推動進展。但總體而言，我覺得近來最主要的挫折來源是：當我們運用我們的三、四、五計畫，並把核心技術組合應用到製造與工程平台以及市場通路平台時，當我們嘗試把新產品導入一位在其他領域很熟悉我們的客戶時，有時我們會忘了不同產業的節奏不同。

So not everything moves like tech, not everything moves like consumer electronics and mobile consumer electronics. As a matter of fact, few things do. So, for instance, it is frustrating how long it's taking us to get widespread adoption of lightweight glazing in automotive. It's a heck of a good idea, good for consumers, it's good for the environment, it's good for safety, it's good for almost everything. But the industry, even when you're a highly valued supplier as we are, it just takes time. So I think the degree of speed with which our innovation can make a difference to our top line, it's a little frustrating.

所以不是所有事情都像科技業那樣快，也不是所有事情都像消費性電子、行動消費性電子那樣快。事實上，很少有事情是那樣的速度。例如，讓輕量化車用玻璃在汽車領域獲得廣泛採用，所花的時間之長，讓人感到挫折。這真的是個非常好的點子，對消費者好、對環境好、對安全好，幾乎對所有面向都好。但這個產業，即使你像我們一樣是高度被重視的供應商，也就是需要時間。所以我認為，我們的創新能以多快的速度對營收帶來影響，這點確實有些令人沮喪。

Yes, excellent. Then a quick follow-on for Tony. Give us your view on where do you see the acquisition strategy trending? Any particular product areas, technologies, market transitions? Thanks.

是的，很好。那接著給 Tony 一個簡短追問。請談談你對併購策略走向的看法？是否有特定的產品領域、技術或市場轉變？謝謝。

Sure. Thanks, Vijay. I think Wendell said before that we feel like there's big opportunities in the optical communications business both with our internal growth opportunities and applying our three, four, five strategy but also from an acquisition standpoint. I would expect that most of our focus as we go forward the next couple of years from M&A, would be looking in the optical communications area.

當然。謝謝你，Vijay。我想 Wendell 之前提過，我們認為光通訊業務有很大的機會，既包括內生成長機會、也包括運用我們的三、四、五策略，同時從併購角度也有機會。我預期未來一兩年我們在併購（M&A）上的重點，大多會放在光通訊領域。

We think we can generate good synergies there. We've got a big power house machine that's there today with $3 billion in sales. I think it gives us really good opportunities to bring in companies and make them better. We have done three acquisitions this year. In those acquisitions, we are really happy with our results. We've been able to prove out, I think, our ability to really drive value with those acquisitions. So I would expect more of the same.

我們認為在那裡可以產生良好的綜效。我們目前已經有一個很強大的平台，銷售額達30億美元。我認為這讓我們有很好的機會把公司納入並把它們做得更好。我們今年已完成三起收購。對於這些收購，我們對結果非常滿意。我想我們已經能證明，我們確實有能力透過這些收購來驅動價值。所以我預期會延續同樣的方向。

Excellent. Thank you.

很好。謝謝。

Doug Clark, Goldman Sachs.

Goldman Sachs 的 Doug Clark。

I wanted to touch on LCD glass pricing a little bit. I understand the three key points that you make about why glass prices could remain stable. On the other side of that and what isn't addressed is kind of the panel maker dynamic, especially as their profit margins continue to erode. Do you see that as a possible area of pressure on your glass pricing going forward, to the extent that demand doesn't firm up and remains soft?

我想稍微談一下 LCD 玻璃的定價。我理解你提出的三個關鍵點，說明為何玻璃價格可能維持穩定。但另一方面、也就是尚未被談到的是面板廠的動態，尤其是當他們的利潤率持續被侵蝕時。如果需求沒有轉強、仍然疲弱，你是否認為這可能會成為未來對你們玻璃定價施壓的來源？

For sure, we think that's always a possibility and that could put pricing pressure on us. But I think what we really expect to see is, as those panel makers go closer to cash costs that they will cut back their utilizations. We saw that in the third quarter in the small gem sizes. We think we will see that over the next couple of quarters in the larger gem sizes. So the reason that we are confident are the three things I talked about relative to the financial situation with our competitors, the benefit that has happened with the significant weakening of the Japanese yen and then our ability to keep glass supply and demand balanced by taking capacity off-line.

當然，我們認為那一直都是可能性，也可能對我們造成定價壓力。但我認為我們真正預期看到的是：當那些面板廠更接近現金成本時，他們會降低稼動率。我們在第三季的小世代尺寸上已經看到這點。我們認為在接下來幾季會在較大世代尺寸上看到同樣情況。因此，我們之所以有信心，是基於我提到的三點：相對於競爭對手的財務狀況、日圓大幅走弱帶來的效益，以及我們透過讓部分產能下線來維持玻璃供需平衡的能力。

But it's an excellent question, Doug. I mean as our display maker customers hit the -- they never made a lot of money but as they hit pain, they will increase the pressure. Then the question is going to be what do our competitors choose to do? Do the factors that Tony has laid out, which is -- as they are basically approaching breakeven in one of them and the other's profit is greatly reduced, how do they react to that pressure given that the display makers are on the opposite side of the yen too and have gotten that tremendous benefit.

但這是個很好的問題，Doug。我的意思是，當我們的顯示器製造客戶——他們本來就沒賺很多錢——開始感到痛苦時，他們會加大施壓。接下來的問題會是：我們的競爭對手會選擇怎麼做？Tony 所列出的那些因素——也就是其中一家基本上接近損益兩平、另一家的獲利大幅下降——在顯示器製造商也同樣站在日圓的另一側、並獲得巨大好處的情況下，他們會如何回應這種壓力？

So how that -- you're on the right question. How that dynamic plays out in the coming quarters is important. I think the good news is what you heard from Tony was in this next quarter, we expect our display pricing to moderate further than it did in quarter three. The profitability problem is already upon the display maker, so that's encouraging data, Doug, encouraging data.

所以你問到重點了。這種動態在接下來幾季如何發展很重要。我認為好消息是，你從 Tony 那裡聽到的是：在下一季，我們預期顯示器玻璃的價格下滑幅度會比第三季更趨緩。面板廠的獲利問題已經出現了，所以這是令人鼓舞的數據，Doug，令人鼓舞的數據。

Right. No, that makes a lot of sense. That's very helpful. Thanks. One follow-up to that more on the volume side. I think in last quarter, you talked about inventories coming down by about two weeks by the end of the year. Wondering if you can give us an update on where supply chain inventories are? To the extent that panel makers cut utilizations between 4Q and 1Q, do you think it will be skewed more towards one or the other quarter?

了解。不，這很合理。非常有幫助。謝謝。再追問一個，偏向出貨量的部分。我記得上季你們提到，到年底庫存會下降大約兩週。想請問你能否更新一下供應鏈庫存目前的狀況？如果面板廠在第四季到第一季之間降低稼動率，你認為會比較偏向發生在其中哪一季？

So right now, our expectations is that there will be some decline in Q4, but it's -- we expect that softness is likely to continue into Q1. Part of that is, that we do know that some panel makers are bringing on capacity in China. We think that has an impact. Of course, we don't know for sure. We were wrong in our last quarter conference call on how much was going to be in Q3 versus Q4. Of course, we could be wrong here.

所以目前，我們的預期是第四季會有一些下滑，但——我們預期疲弱可能會延續到第一季。其中一部分原因是，我們確實知道有些面板廠正在中國新增產能。我們認為那會帶來影響。當然，我們也無法完全確定。我們在上一季的電話會議中，對於第三季相對於第四季會發生多少的判斷是錯的。當然，我們這次也可能會判斷錯。

We do think that is what is going to be necessary to get the supply chain inventories at a healthy level. Clearly, since demand is less than what we thought last quarter, even though inventories are going to go down in the fourth quarter, that inventory level at the end of the fourth quarter is a little bit higher than what we would have projected last quarter. We expect that to bleed off in the first quarter.

我們確實認為，這正是讓供應鏈庫存回到健康水位所必需的作法。很明顯地，由於需求低於我們上季的預期，即使第四季庫存會下降，第四季末的庫存水位仍會比我們上季原先預估的略高一些。我們預期這會在第一季逐步消化掉。

Got it. Thank you very much.

了解。非常感謝。

Joseph Wolf, Barclays.

Joseph Wolf，巴克萊。

I just wanted to start and get a lot of detail on the capital deployment. You mentioned investor input. I'm wondering if you're having some sort of internal -- I don't know if we call it contest with the engineers that you have mentioned to go after that capital of projects that they are looking at? Also, any pace of deployment that you're thinking about in terms of over the entire four years? Or could we wake up one morning and you have decided to spend half of that on one very specific and targeted project with a lot of growth opportunity?

我想先從資本配置開始，並請教更詳細的內容。您提到投資人的意見回饋。我想知道你們內部是否有某種——我不知道是否該稱為競賽——讓您提到的工程師去爭取他們正在評估的那些資本專案？另外，就整個四年期間而言，您對部署節奏有什麼想法嗎？或者，我們是否可能某天早上醒來就發現你們決定把其中一半投入到某個非常特定、聚焦且具高度成長機會的專案上？

Great questions, Joseph. So I think you should think of the deployment as fitting our culture, which is in the way our innovation model works. When you do material science, whether you dig stuff out of the ground or take assets and end up converting them into highly engineered components, that takes time. Since that takes time, the bad news is that things don't turn overnight your way. The good news is that the things tend not to sneak up on you.

很好的問題，Joseph。我認為你應該把這次的部署方式視為符合我們的文化，也就是我們創新模式運作的方式。當你做材料科學時，不論是從地底開採，或是取得資產並將其轉化為高度工程化的零組件，這都需要時間。既然需要時間，壞消息是事情不會一夕之間就朝對你有利的方向轉變。好消息是，事情通常也不會在你毫無防備時突然發生。

So I think you can expect some pretty steady behavior honestly. As we go out and talk to investors, we will give clear indications on, here's where our tendency is going to be as far as where we are going to invest that $10 billion. We'll give you a good feel for rough ideas of timing and how that plays. The big thing that we are picking up here with this focused portfolio is increased productivity. That increased productivity is what's behind our ability to give more to the shareholders.

所以我認為你可以期待我們的行為會相當穩健、持續。當我們外出與投資人溝通時，我們會清楚說明：就這100億美元而言，我們的投資傾向會落在哪些方向。我們也會讓你對大致的時程與推進方式有清楚的感覺。這個聚焦的投資組合帶給我們的最大收穫，是生產力的提升。而這個生產力提升，正是我們能夠回饋股東更多的原因。

So if you were to take a look out over the last 10 years; right? About 30% of the funds we had available, we were able to give to shareholders either in the form of dividend or share repurchase. As we look forward over this next four years, because of that increased productivity, we are looking at an ability to do about 50% over that time period. That will be a steady effort. That's the way you should expect this to behave. Did that answer your question?

如果你回頭看過去10年，對吧？我們可運用資金中約有30%，能以股利或庫藏股（股票回購）的形式回饋給股東。展望未來四年，因為生產力提升，我們預期在那段期間有能力做到約50%。這會是一項穩定、持續的努力。你應該預期它會以這種方式運作。這樣有回答到你的問題嗎？

Thank you, that's helpful.

謝謝，這很有幫助。

Okay.

好的。

Yes. No, that was very helpful. Just a follow-up on the environmental business. If you think about -- if you had a view -- maybe if I had a view or one had a view on the trucking business globally, how would you expect the business would go in terms of the way trucks are moving? Could they be more negative than you based on that viewpoint? Or is there growth in the environmental business independent of growth in trucks? Especially, the heavy-duty or long haul trucking?

是的。不，那真的很有幫助。我想就環保事業再追問一下。如果你從全球卡車產業的角度來看——假設你有一個看法，或我有一個看法，或任何人有一個看法——你預期在卡車運行（出貨/行駛）情況上，這個事業會如何發展？基於那個觀點，情況是否可能比你們的看法更負面？或者，環保事業是否存在不依賴卡車成長的成長動能？特別是重型或長途運輸卡車？

I think growth in the environmental business in total, of course, is going to be driven by both what happens with trucks and light-duty vehicles. On a global basis as long as total production for light-duty vehicles increase, you will see some growth in the environmental business. Of course, pollution regulations make a big impact on that business too.

我認為整體而言，環保事業的成長當然會同時受到卡車與輕型車市場表現的驅動。在全球範圍內，只要輕型車總產量增加，你就會看到環保事業有一些成長。當然，污染排放法規也會對這項業務造成很大的影響。

I think from the heavy-duty diesel standpoint, we have seen strong growth in North America over the last couple of years, some of it economically driven, some of it regulation driven. In Europe, the regulations in particular caused nice growth in 2014. I think what we are faced with right now in 2015 in China is just that the truck production is down significantly compared to what it had run at, actually, over the last six years, down about 34% on a year-to-date basis.

以重型柴油車的角度來看，過去幾年我們在北美看到強勁成長，其中一部分是經濟因素帶動，一部分是法規因素帶動。在歐洲，尤其是法規在2014年帶來了不錯的成長。我認為我們目前在2015年於中國面臨的情況是，卡車產量相較於其實過去六年的水準顯著下滑，年初至今約下降34%。

That from a very specific to China impact is impacting us both from a revenue standpoint but also from a cost standpoint because we obviously put cost in place to be able to manufacture to meet that demand. Until those sales turn around, along with the improving regulatory environment there, those -- I mean, that's really what we are looking for in 2016. We think there will be some improvement in 2016, but we are still waiting to see -- we certainly don't think that will improve much in Q4.

這種非常特定、來自中國的影響，對我們同時造成營收面與成本面的衝擊，因為我們顯然已經配置了成本，以具備製造能力來滿足那樣的需求。在銷售回升、加上當地法規環境改善之前，這些——我的意思是，這正是我們對2016年所期待的重點。我們認為2016年會有一些改善，但我們仍在觀察——我們當然不認為第四季會有太大改善。

From the most macro standpoint, it's not the amount of trucks that are bought in the world. That, we don't need to grow. What we need is more compliant trucks. Then same thing with cars, even though cars continue to expand and grow very nicely, right? For our automotive -- our environmental business, it is driven by compliance. So the tighter air requirements get, the more of our components get used. As new countries come on board to clean up their air, that's what adds the big swaths of demand, but it's really an excellent question.

從最宏觀的角度來看，關鍵不在於全球買了多少卡車。那個部分，我們不需要它成長。我們需要的是更多符合排放規範的卡車。汽車也是同樣的道理，即使汽車持續擴張且成長得相當不錯，對吧？對我們的汽車——環保事業而言，驅動因素是合規（符合法規）。因此，空氣排放要求越嚴格，我們的零組件就會被使用得越多。當新的國家加入改善空氣品質的行列時，這才會帶來大範圍的需求增量；不過這確實是個很棒的問題。

All right. Thank you very much.

好的。非常感謝。

Steven Fox, Cross Research.

Steven Fox，Cross Research。

Just the first question on the new plan. I guess when I think about the three, four, five that you laid out, I guess the three and the four have typically outperformed historically for Corning but the five has been the one where timing the products to market et cetera has been problematic. Under the new focus, can you just discuss how maybe getting products to market or matching your customers or end market needs gets better and timing more predictable? Then I had a quick follow-up.

第一個問題是關於新計畫。我想，當我想到你提出的三、四、五時，我認為三和四在康寧的歷史表現通常優於預期，但五一直是在產品上市時點等方面較容易出問題的部分。在新的聚焦之下，你能否談談，產品推向市場或更貼合客戶/終端市場需求會如何改善，並讓時程更可預測？然後我有一個簡短的追問。

Yes, I think in a way we tend to be -- the timing piece for us by and large -- it's possible to miss timing on both ends, right? But where we tend to miss timing is we are ready earlier than our customers, which I guess beats the heck out of the other timing base, right? So that can lead us to have capacity out ahead of demand. That can lead us to have innovations ready before our customers need to pull them. It's been one of the lovely things about mobile consumer electronics is it's almost impossible to be faster than those guys.

是的，我想某種程度上我們往往會——就時程而言，我們大致上——兩端都有可能錯過時點，對吧？但我們比較常錯過的情況是：我們準備得比客戶更早；我想這總比另一種時程錯配要好得多，對吧？因此，這可能導致我們的產能建置超前於需求。也可能導致我們的創新在客戶需要拉貨之前就已經準備好了。行動消費性電子的一個美妙之處在於，你幾乎不可能比那些公司更快。

So we continue to work on how do we get better at picking these inflection points? Actually I commented that Jeff Evenson, our new Chief Strategic Officer is here today -- a big part of his new role is to work on exactly that. How do we get a little better at understanding not only the timing basis for our innovation sets but also when our potential inflection points in our market sets? How should that impact the timing of our capacity decisions? I think you're quite right to note it as an area where we can improve. Hopefully, more to come on that topic.

所以我們持續在思考：要如何更擅長判斷這些拐點？其實我也提到，我們新的首席策略長Jeff Evenson今天也在現場——他新職務的一大部分，就是專注在這件事上。我們要如何在理解創新組合的時程基礎上做得更好，同時也更了解我們市場組合中可能出現的拐點會在何時發生？這應該如何影響我們產能決策的時點？我認為你指出這是我們可以改善的領域，說得很對。希望之後能在這個主題上提供更多資訊。

Thanks. Then just a very quick follow-up. So if we think about the out-of-focus portfolio, is it safe to assume, then, that it is roughly maybe 20% of your profits today? Or is that a level of detail?

謝謝。那我再很快追問一下。所以如果我們從非核心投資組合來看，是否可以安全地假設，它大概占你們目前利潤的約20%？還是說這樣的細節層級不便提供？

I wouldn't make assumptions or speculate today on that matter, though I do understand why you're trying to.

我今天不會就這件事做任何假設或推測，不過我理解你為什麼想這麼問。

Thanks. Thanks for your understanding.

謝謝。謝謝你的理解。

Yes. (laughing).

是的。（笑）。

Patrick Newton, Stifel.

Patrick Newton，Stifel。

On the shareholder return or capital allocation framework that you've talked about, one clarification and one question. On the clarification and I think, Wendell, you alluded to this but is any potential transaction with Dow Corning baked into this current outlook through 2019 or would it be additive to the current outlook? Then I guess for Tony, on the global cash use being reduced to about $2 billion, is that going to be focused on acquisition efforts for international targets? Or is it a repatriation part of your strategy? Then I have a follow-up.

關於你們談到的股東回報或資本配置框架，我有一個釐清與一個問題。先釐清一下，我想Wendell你剛才有提到：任何與道康寧（Dow Corning）的潛在交易，是否已經納入目前到2019年的展望之中，還是會在現有展望之上額外增加？接著我想問Tony，全球現金使用將降至約20億美元，這會主要用於海外標的的併購嗎？還是說匯回（repatriation）是你們策略的一部分？然後我還有一個追問。

I think on the first question, any potential transactions we are not going to talk any more about Dow Corning, but any potential transactions are additive to that number. I mean, what we have very clearly stated is that we believe we can deliver more than $10 billion back to shareholders based on our current plans and anything on top of that from a transaction standpoint would be additive to that. Our bias right now based on what we know would be to have those transactions be additive, but bottom line is, it's additive.

我想就第一個問題，我們不會再多談道康寧，但任何潛在交易都會在那個數字之上額外增加。也就是說，我們已非常清楚地表示，基於目前的計畫，我們相信可以向股東回饋超過100億美元；而任何交易所帶來的額外部分，都會加在其上。以我們目前所知，我們的傾向是讓這些交易帶來的效益在既有基礎上額外增加；但總之，就是額外增加。

In terms of the cash amount on the $2 billion, I mean I think clearly it's our belief that $2 billion is an adequate amount to have from a Company standpoint, given our cash flow generations. As a reminder, our goal is to have 2X EBITDA in debt. Our plans are have -- is to have that $2 billion, reduce that cash over the next couple of years. In terms of where that cash is actually located, it will depend a lot depending on where our taxing policy is in the United States, as we can always add the debt in the United States and keep the cash offshore if that makes sense.

至於20億美元的現金水位，我想很明確地說，考量我們的現金流量創造能力，我們認為從公司角度來看，保有20億美元是足夠的。提醒一下，我們的目標是將負債維持在EBITDA的2倍。我們的計畫是保有這20億美元，並在未來幾年降低現金水位。至於這些現金實際位於何處，將很大程度取決於美國的稅務政策；因為如果合理的話，我們可以在美國增加負債，同時把現金留在海外。

Nope That's helpful. As a follow-up, I really want to dive into gross margin given some of your commentary. I think in the near term, you're talking about fixed cost absorption as what is pressuring the metric in the September quarter results and then in the December quarter guidance. But if I step back and I look at your gross profit since 2010 and arguably when display started to mature, it's been on a negative trajectory.

了解，這很有幫助。作為追問，我想根據你們的一些評論，深入談談毛利率。我認為在短期內，你們提到固定成本吸收（fixed cost absorption）是造成9月季度結果以及12月季度指引中該指標承壓的原因。但如果我退一步看你們自2010年以來的毛利，且可以說在顯示業務開始成熟之後，它一直呈現下滑趨勢。

It increased in 2014 due to the consolidation of SCP. Now as you're lapping that on a -- it seems to be redecelerating, I guess. Is this -- structurally, how should we think about your gross margin profile perhaps over the next five years or during your capital allocation framework time period, from the 42% level, do you anticipate it will have positive trajectory or will it be sustainable or further pressure?

2014年因為合併SCP而上升。現在在這個基期效應消退之後——看起來似乎又在重新放緩、下行。那麼從結構面來看，未來五年或在你們資本配置框架期間，你們的毛利率輪廓應該如何看待？

Yes, we do think we are going to have a positive trajectory. I mean, where we are right now, as I explained before, is driven really by a few things. The first item is in our display business. In the third quarter, our volume was a little bit less than what we expected and that negatively impacted our cost but we can take cost out and reduce capacity to meet market demand.

是的，我們確實認為會有正向趨勢。我的意思是，我們目前的狀況，如我先前解釋的，主要是由幾個因素所驅動。第一項是在我們的顯示業務。第三季的出貨量比我們預期略低，這對成本造成負面影響；但我們可以透過降本並降低產能來配合市場需求。

We are doing that and in the fourth quarter, our gross margins are actually consistent in the fourth quarter of 2015 as they were in the fourth quarter of 2014. So the real issues are in environmental and optical communications and in both those businesses, we have put capacity in place for new businesses that isn't showing up today.

我們正在這麼做，而第四季的毛利率其實與2015年第四季和2014年第四季一樣一致。所以真正的問題在於環境科技與光學通訊；在這兩個業務中，我們為新業務建置了產能，但目前尚未反映在營收上。

We expect those businesses to show up in 2016. For some reason they don't show up, we certainly will take the cost down but the whole purpose of this framework and the integration of this is partly to drive lower -- us to the lowest cost producer and that definitely helps us from a gross margin standpoint. So I think over time -- right now, we are certainly having seen some gross margin compression as our sales are going down but as our sales return, we would expect gross margins to expand.

我們預期這些業務會在2016年顯現。如果基於某些原因沒有顯現，我們當然會降低成本；但這個框架與整合的一個目的，部分就是要推動我們成為最低成本的生產者，而這無疑會在毛利率面提供幫助。所以我認為隨著時間推進——目前我們確實在銷售下滑時看到毛利率被壓縮，但當銷售回升時，我們預期毛利率會擴張。

Great. Thank you for taking my questions. Good luck.

很好。謝謝你回答我的問題。祝順利。

Thank you, Patrick. Thank you, everyone. Just as a reminder, the slides are posted on our IR web page for those for your reference. We have a couple announcements. We will be out visiting investors during the month of November. Also, we will be at the UBS conference on November 17 in San Francisco and the Credit Suisse conference on December 1 in Scottsdale.

謝謝你，Patrick。謝謝各位。提醒一下，投影片已張貼在我們的投資人關係（IR）網頁上，供各位參考。我們有幾項公告。我們將在11月期間外出拜訪投資人。另外，我們也會參加11月17日在舊金山舉行的UBS會議，以及12月1日在斯科茨代爾（Scottsdale）舉行的瑞信（Credit Suisse）會議。

Thank you all for joining us today. Our playback of the call is available beginning at 11:00AM eastern and will run until 5:00PM on Tuesday, November 10. To listen, dial 800-475-6701. The access code is 370570. The audio cast, of course, is available on our website as well during that time. Roxanne, that concludes our call. Please disconnect all lines.

感謝各位今天加入我們。本次電話會議的重播將於美東時間上午11:00開始提供，並持續至11月10日（週二）下午5:00。收聽請撥打800-475-6701。存取碼為370570。當然，在此期間也可於我們網站收聽網路音訊直播回放。Roxanne，我們的電話會議到此結束。請斷開所有線路。