康寧 (GLW) 2017 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the Corning Incorporated quarter 4 2017 earnings results.

各位女士、先生，感謝您稍候。歡迎參加康寧公司 2017 年第四季財報結果電話會議。

It's my pleasure to turn the call over to Ann Nicholson, Division Vice President of Investor Relations.

我很榮幸將電話會議交給投資人關係事業部副總裁 Ann Nicholson。

Thank you, Jon. And good morning. Welcome to Corning's Year-end 2017 Conference Call.

謝謝你，Jon。各位早安。歡迎參加康寧 2017 年年終電話會議。

With me today are Wendell Weeks, Chairman and Chief Executive Officer; and Jeff Evenson, Senior Vice President and Chief Strategy Officer. Because of a family emergency, Tony Tripeny, Senior Vice President and Chief Financial Officer, is not on the line today, but he looks forward to talking with investors throughout the quarter. And we're sending his family our regards. And joining us today are Ed Schlesinger, Vice President and Corporate Controller; and Stefan Becker, Vice President and Operations Controller.

今天與我一同出席的有董事長兼執行長 Wendell Weeks，以及資深副總裁兼首席策略長 Jeff Evenson。由於家中緊急狀況，資深副總裁兼財務長 Tony Tripeny 今天未能在線上，但他期待在本季期間與投資人交流。我們也向他的家人致上慰問。另外，今天加入我們的還有公司副總裁暨企業財務控管長 Ed Schlesinger，以及副總裁暨營運控管長 Stefan Becker。

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

提醒各位，今天的發言包含前瞻性陳述，屬於 1995 年《私人證券訴訟改革法案》所定義之範圍。這些陳述涉及風險、不確定性及其他因素，可能導致實際結果出現重大差異。相關因素已詳載於本公司的財務報告中。

You should also note that we'll be discussing our results using core performance measures, unless we specifically indicate our comments relate to GAAP data. Our core performance measures are non-GAAP measures used by management to analyze the business. A reconciliation of core results to the comparable GAAP values can be found in the Investor Relations section of our website at corning.com.

也請注意，除非我們特別說明評論與 GAAP 數據相關，否則我們將以核心績效衡量指標來討論業績。我們的核心績效衡量指標為非 GAAP 指標，供管理階層用以分析業務。核心結果與可比較 GAAP 數值之調節表，可於 corning.com 網站的投資人關係專區查閱。

Supporting slides are being shown live on our webcast, and we encourage you to follow along. It will also be available on our website for downloading.

支援投影片正於我們的網路直播中同步展示，建議您一同觀看。投影片也將提供於我們網站供下載。

Now I'll turn the call over to Wendell.

現在我把電話會議交給 Wendell。

Thank you, Ann. And welcome, everyone.

謝謝你，Ann。也歡迎各位。

This morning, we reported a strong finish to an outstanding year. And we feel great about our progress and our prospects.

今天早上，我們公布了在傑出年度中強勁收官的表現。我們對自身的進展與前景都感到非常振奮。

Strong growth and strong investment generated an $800 million sales increase for the year and set the stage for additional growth. We exited the year running at full capacity in several of our businesses and with committed customer demand that supports our current capacity expansion initiatives. We expect to see the benefits of these initiatives in the second half of 2018 and beyond as production ramps. 2018 will be another year of strong growth and investment, consistent with our strategy and capital allocation framework. All of our businesses contributed to the outstanding 2017 results, highlighted by 18% year-over-year sales growth in Optical Communications, 25% growth in Specialty Materials, 7% growth in environmental; and price declines in displays that were the best in 7 years.

強勁的成長與強勁的投資，使全年銷售額增加 8 億美元，並為進一步成長奠定基礎。年末時，我們多項業務以滿載產能運行，且客戶的承諾性需求支持我們目前的產能擴張計畫。隨著產能爬坡，我們預期將在 2018 年下半年及之後看到這些計畫帶來的效益。2018 年將是另一個強勁成長與投資之年，符合我們的策略與資本配置架構。我們所有業務都為 2017 年的亮眼成果做出貢獻，其中包括：光學通訊年對年銷售成長 18%、特殊材料成長 25%、環境相關成長 7%；以及顯示器價格下滑幅度為 7 年來最佳。

As we've shared, the strategy and capital allocation framework outlines our leadership priorities, but we continue to focus our portfolio and utilize our financial strength to extend our leadership, drive our growth and reward our shareholders. Under the framework, we target generating $26 billion to $30 billion in cash through 2019. We plan to return more than $12.5 billion to our shareholders through repurchases and dividends and invest $10 billion to extend our leadership and deliver growth across all of our market access platforms. We've made great progress toward those goals since we announced the framework in October of 2015. Our cash generation is on target. And through the end of 2017, we returned $9 billion through share repurchases and dividends. We've invested $4.5 billion under the framework in RD&E, capital expenditures and acquisitions. We're starting to see the returns already. As you can see in our most recent results, full year sales increased 8% and EPS increased 11%. And we expect these returns to accelerate.

如同我們先前分享，策略與資本配置架構勾勒出我們的領導優先事項；同時我們持續聚焦投資組合，並運用財務實力來延伸領導地位、推動成長並回饋股東。在該架構下，我們目標是在 2019 年前創造 260 億至 300 億美元的現金。我們計畫透過庫藏股回購與股利，回饋股東超過 125 億美元，並投資 100 億美元以延伸領導地位，並在所有市場切入平台上帶動成長。自 2015 年 10 月公布該架構以來，我們已朝目標取得重大進展。我們的現金創造符合目標。截至 2017 年底，我們已透過股票回購與股利回饋 90 億美元。在該架構下，我們已於研發與工程（RD&E）、資本支出與併購投資 45 億美元。我們已開始看到回報。如您在最新結果所見，全年銷售成長 8%，每股盈餘（EPS）成長 11%。我們預期這些回報將加速。

We believe that these results illustrate the benefits of our framework. We are best in the world in 3 core technologies, 4 manufacturing and engineering platforms and 5 market access platforms. We focus 80% of our resources on opportunities that use capabilities in at least 2 of these 3 categories. And we've stepped up our investments over the last 6 months to meet opportunities in front of us in all of our market access platforms. Significant portions of the investments are going towards capacity expansions to meet committed demand. Currently, we have 23 projects underway, including construction of 11 new plants. These investments dampened our profitability in the second half of 2017 and will do so again in the first half of 2018, although we really see the benefits of those investments in sales and profitability in the back half, so we feel great about the year ahead of us.

我們相信，這些結果展現了我們架構的效益。我們在 3 項核心技術、4 大製造與工程平台，以及 5 個市場切入平台上皆為全球領先。我們將 80% 的資源聚焦於同時運用上述 3 大類別中至少 2 類能力的機會。過去 6 個月，我們已提高投資力度，以把握所有市場切入平台上眼前的機會。相當大一部分投資用於產能擴張，以滿足已承諾的需求。目前我們有 23 個專案進行中，包括興建 11 座新工廠。這些投資在 2017 年下半年壓抑了我們的獲利能力，並將在 2018 年上半年再次造成影響；不過我們確實會在下半年看到這些投資在銷售與獲利上的效益，因此我們對即將到來的一年感到非常樂觀。

Now let me review progress in our market access platforms, starting with Optical Communications.

接下來我將回顧我們在各市場切入平台的進展，先從光學通訊開始。

We're the world leader in passive optical communications and the only true end-to-end supplier of integrated optical solutions. 2017 was another great year. We expanded strategic relationships, like the ones we've recently announced with Verizon and Saudi Telecom, which supports our view of strong future growth. We expanded our manufacturing capacity to support growing demand and initiated programs to further expand capacity in 2018. During 2017, we acquired SpiderCloud to enhance our wireless portfolio and announced an agreement to purchase 3M's communications markets division. We expect that transaction to close later this year. It brings us a talented group of employees. It enhances our offerings in the rapidly growing fiber to the home and optical solutions markets.

我們是全球被動式光學通訊的領導者，也是唯一真正端到端的一體化光學解決方案供應商。2017 年又是非常出色的一年。我們擴大了策略合作關係，例如近期與 Verizon 及 Saudi Telecom 宣布的合作，支持我們對未來強勁成長的看法。我們擴充製造產能以支援持續成長的需求，並啟動計畫在 2018 年進一步擴產。在 2017 年期間，我們收購 SpiderCloud 以強化無線產品組合，並宣布協議收購 3M 的通訊市場事業部。我們預期該交易將於今年稍晚完成。此交易將為我們帶來一支優秀的員工團隊。並強化我們在快速成長的光纖到府（FTTH）與光學解決方案市場的產品供給。

We expect to continue growing more than twice as fast as the communications infrastructure market. Rapid adoption of optical solutions in more market segments, combined with the strength and relevance of our technology and co-innovation approach, support our superior growth. We believe that the opportunities ahead of us are much greater than those that are behind us. To capture these opportunities, we continue to invest in plants, innovations and market access. We expect 2018 growth to keep us solidly on pace to reach $5 billion in sales by 2020.

我們預期將持續以高於通訊基礎建設市場兩倍以上的速度成長。光學解決方案在更多市場區隔的快速採用，加上我們技術的強度與相關性，以及共同創新模式，支撐我們的卓越成長。我們相信，未來的機會遠大於過去。為了掌握這些機會，我們持續投資於工廠、創新與市場切入。我們預期 2018 年的成長將使我們穩健朝 2020 年達成 50 億美元銷售額的目標邁進。

Now let's turn to mobile consumer electronics, where we are the world leader in glass, in smartphones, tablets and emerging categories like wearables and augmented reality devices. Our goal is to double mobile consumer electronics sales over the next several years. We made significant progress toward that goal in 2017. Major milestones during the year included the 10th anniversary of Corning Gorilla Glass, rapid adoption of Gorilla Glass 5 and Apple's commitment to our future innovations through its American manufacturing initiative. The fundamental properties of Gorilla Glass make it an ideal choice for smartphone [enclosures]. Flagship models from Samsung and others now feature glass on the front and the back. Glass backs double the area we sell per phone and also support new innovation opportunities like fiber. We expect additional growth in 2018 as more devices adopt our latest innovations, including our next generation of cover glass which we plan to introduce later this year.

現在讓我們轉向行動消費性電子領域；在智慧型手機、平板電腦，以及穿戴式裝置與擴增實境裝置等新興類別的玻璃方面，我們是全球領導者。我們的目標是在未來幾年將行動消費性電子銷售額翻倍。我們在 2017 年朝該目標取得顯著進展。年度重要里程碑包括：康寧大猩猩玻璃（Corning Gorilla Glass）問世 10 週年、Gorilla Glass 5 的快速採用，以及 Apple 透過其美國製造計畫承諾支持我們未來的創新。Gorilla Glass 的基本特性使其成為智慧型手機[外殼]的理想選擇。Samsung 等品牌的旗艦機型如今在正面與背面皆採用玻璃。玻璃背蓋使我們每支手機可銷售的面積加倍，並且也支援如光纖等新的創新機會。隨著更多裝置採用我們最新的創新，我們預期 2018 年將有進一步成長，其中包括我們計畫於今年稍晚推出的下一代蓋板玻璃。

Turning to our automotive market access platform. Our expertise focuses on helping customers build cleaner, safer and more connected vehicles. Corning pioneered the substrate at the heart of catalytic converters and is now leading the next wave of emissions control with our introduction of gas particulate filters. Most European and many Chinese OEMs have now awarded platforms, and we won the majority, reflecting our market leadership. We had our first commercial sales in the second half of 2017, and we expect a sales ramp in 2018. Once regulations are fully implemented in Europe next year and China in the early 2020s, we estimate the GPF opportunity will exceed $0.5 billion in sales for Corning.

接著談我們的汽車市場導入平台。我們的專業聚焦於協助客戶打造更潔淨、更安全且更互聯的車輛。康寧率先開發了催化轉換器核心的載體基材，如今並透過推出汽油顆粒過濾器（GPF），引領下一波排放控制浪潮。目前多數歐洲及許多中國的OEM已授予平台，我們贏得其中大多數，反映我們的市場領導地位。我們在2017年下半年取得首批商業銷售，並預期2018年銷售將加速成長。待明年歐洲法規全面落地、以及中國於2020年代初期全面實施後，我們估計GPF對康寧的銷售機會將超過5億美元。

Moving to Gorilla Glass for auto. Innovation trends continued to point toward a significant growth opportunity. On the exteriors of cars, Gorilla Glass laminates are tougher and lighter than conventional auto glass, plus the superior optical quality allows for larger and clearer head-up display. For interiors, integrated and interactive displays are becoming a seamless part of the cabin and user experience. Corning is helping OEMs with this transition because Gorilla Glass provides an advanced, durable optical interface surface with tremendous economics. Earlier this month, exhibits at CES provided impressive evidence for the increasing use and importance of glass in cars. We believe that our solutions provide compelling value. And we are investing to prepare for the industry's transition to highly connected and autonomous vehicles, which will use Gorilla Glass. Pull for collaboration from leading OEMs is increasing, and we have already been awarded 35 platforms globally. We expect to make additions and significant progress during 2018.

接著談汽車用Gorilla Glass。創新趨勢持續指向顯著的成長機會。在車輛外部，Gorilla Glass夾層玻璃比傳統汽車玻璃更堅韌且更輕，同時其優異的光學品質可支援更大、更清晰的抬頭顯示器（HUD）。在車內方面，整合式與互動式顯示正逐漸成為座艙與使用者體驗的無縫一部分。康寧正協助OEM完成此轉型，因為Gorilla Glass提供先進、耐用的光學介面表面，且具備極佳的經濟效益。本月稍早，CES上的展示為玻璃在汽車中的使用增加與重要性提升提供了令人印象深刻的證據。我們相信我們的解決方案提供了極具吸引力的價值。我們也正在投資，以因應產業轉向高度互聯與自動駕駛車輛的趨勢，而這些車輛將採用Gorilla Glass。來自領先OEM的合作需求正在增加，我們已在全球獲得35個平台授予。我們預期在2018年將新增更多平台並取得重大進展。

In our life science vessels platform, we're building a new, a long-term multibillion-dollar franchise. Last July, we introduced Corning Valor Glass, our remarkable, new pharmaceutical glass packaging solution. Valor Glass dramatically reduces particle contamination, breaks and cracks while significantly increasing throughput. Valor helps protect patients and improve pharmaceutical manufacturing. The industry is excited about our innovation and announcement. And we continue to make strong progress, although it moves at a deliberate pace. Recently, the Parenteral Drug Association hosted a 2-day conference dedicated to glass quality. Corning presented in a session focused on new developments and innovations in pharmaceutical packaging. And we remain closely engaged with our development partners Merck and Pfizer and are pleased with the progress we have seen with our customers over the last quarter. We've successfully completed multiple collaborative projects to support customer adoption of Valor. We also continue to engage with the Food and Drug Administration, which is committed to streamlining the introduction of new innovations so technologies like Valor Glass can reach patients quickly. In 2018, we plan to invest in high-volume manufacturing that will enable us to deliver commercial volumes to our customers. You will hear more from us regarding the manufacturing site and location in the coming months. We continue to believe Valor has the potential to power Corning's growth for the next decade and beyond.

在我們的生命科學容器平台方面，我們正在打造一個新的、長期的數十億美元級事業版圖。去年7月，我們推出了康寧Valor Glass，這是一項卓越的新型藥用玻璃包裝解決方案。Valor Glass可大幅降低微粒污染、破損與裂紋，同時顯著提升產能吞吐量。Valor有助於保護病患並改善製藥製造流程。產業對我們的創新與發布感到振奮。我們也持續取得強勁進展，儘管推進節奏審慎而有序。近期，注射劑藥物協會（Parenteral Drug Association）主辦了一場為期兩天、聚焦玻璃品質的研討會。康寧在一場聚焦藥品包裝新發展與創新的議程中進行了發表。我們仍與開發夥伴默克（Merck）與輝瑞（Pfizer）保持緊密合作，並對過去一季在客戶端所見的進展感到滿意。我們已成功完成多項合作專案，以支持客戶採用Valor。我們也持續與美國食品藥物管理局（FDA）互動；FDA致力於簡化新創新導入流程，使Valor Glass等技術能更快觸及病患。在2018年，我們計畫投資高產量製造能力，以便向客戶交付商業規模的供貨量。未來幾個月，我們將就製造基地與地點提供更多資訊。我們仍相信Valor有潛力驅動康寧未來十年及更長期的成長。

In display, we remain the global leader. Our priority is to deliver stable returns and win in new display categories. We expect 2018 to be another year of strong progress for our display business. Our new plant in Hefei, China has started shipping the world's first Gen 10.5 glass. We are the only manufacturer to have successfully scaled glass production through these odds. Ramping our new Gen 10.5 facility on pace with BOE, our major customers, will augmented volume growth. In addition, pricing has become consistently more favorable over the past 3 years. In June, we stated that improvement to mid-single-digit declines was possible. We now believe this will happen in 2018. Reaching mid-single-digit annual pricing is a huge milestone toward our goal of maintaining stable returns.

在顯示器領域，我們仍是全球領導者。我們的優先事項是提供穩定報酬，並在新的顯示器類別中勝出。我們預期2018年將是顯示器事業再度強勁進展的一年。我們位於中國合肥的新工廠已開始出貨全球首款10.5代玻璃。我們是唯一成功將玻璃量產擴產至此規模的製造商。隨著我們的10.5代新廠與主要客戶京東方（BOE）同步爬坡，將帶動出貨量成長。此外，過去三年價格走勢已持續轉為更有利。我們在6月曾表示，價格跌幅改善至中個位數百分比是可能的。我們現在相信這將在2018年發生。達成年度中個位數百分比的價格變動，是朝向我們維持穩定報酬目標的一項重大里程碑。

Finally, Iris Glass, which adds a third piece of glass to LCD displays, is gaining momentum. We are excited about Lenovo's and Dell's new ultrathin monitors which offer the world's brightest monitors in a thin, narrow-bezel package uniquely enabled by Corning's Iris Glass.

最後，Iris Glass可在LCD顯示器中增加第三片玻璃，正逐步累積動能。我們對聯想（Lenovo）與戴爾（Dell）的新款超薄顯示器感到振奮；其以纖薄、窄邊框的設計提供全球最明亮的顯示器表現，而這項獨特能力正是由康寧的Iris Glass所促成。

I think it's pretty clear we're making terrific progress across all of our market access platforms. We are investing to capture these opportunities and expect to maintain the 2017 momentum in 2018. We plan to deliver another strong year of sales and earnings growth and stay on track to fully achieving our strategy and capital allocation framework goals.

我想很清楚的是，我們在所有市場導入平台上都取得了極佳進展。我們正投資以掌握這些機會，並預期在2018年延續2017年的動能。我們計畫再交出銷售與獲利成長強勁的一年，並持續朝全面達成我們的策略與資本配置架構目標邁進。

Now let me turn the call over to Jeff for a review of our results, details on our outlook and additional updates on our framework.

現在我把電話交給Jeff，請他回顧我們的業績、說明展望細節，並就我們的架構提供更多更新。

Thank you, Wendell. And good morning, everyone.

謝謝你，Wendell。各位早安。

Our 2017 results were outstanding. In 2018, we'll continue investing to support our customers and extend our leadership. We expect core sales to grow to approximately $11 billion or about 7% on a constant currency basis.

我們2017年的成果非常出色。在2018年，我們將持續投資以支持客戶並延伸我們的領導地位。我們預期核心銷售額將成長至約110億美元，按固定匯率基礎約成長7%。

Before we do each segment results, I want to talk about 2 items affecting our GAAP results: FX accounting and tax reform. As we've discussed before, GAAP accounting requires earnings translation hedge contracts settling in future periods to be marked to market and recorded at current value at the end of each quarter even though those contracts will not be settled in the current quarter. For us, this resulted in an after-tax GAAP gain of $1 million for the fourth quarter and a loss of $247 million for the full year. To be clear, this mark-to-market accounting has no impact on our cash flow. Our currency hedges protect us economically from foreign exchange rate fluctuations; and provide higher certainty for our earnings and cash flow, our ability to invest for growth and our future shareholder distributions. We're very pleased with our hedging program and the economic certainty it delivers. We've received $1.6 billion in cash under our hedge contracts over the last 5 years.

在逐一說明各事業部門業績之前，我想先談兩項影響我們GAAP結果的因素：外匯會計與稅改。如同我們先前討論過的，GAAP會計要求將於未來期間結算的盈餘換算避險合約按市價評價，並在每季季末以當期價值入帳，即使這些合約不會在當季結算。對我們而言，這使得第四季稅後GAAP收益為100萬美元，而全年稅後GAAP損失為2.47億美元。需要強調的是，這種按市價評價的會計處理對我們的現金流沒有影響。我們的貨幣避險在經濟上保護我們免受匯率波動影響；並為我們的獲利與現金流、成長投資能力以及未來股東分配提供更高的確定性。我們對避險計畫及其帶來的經濟確定性非常滿意。過去五年，我們已透過避險合約收到16億美元現金。

Our non-GAAP or core results provide additional transparency into operations by using a fixed currency rate aligned with our yen and won translation hedges and also by adjusting for other items that did not reflect ongoing operations. For 2015 to 2017, our core reporting used a constant currency rate of JPY 99 to the U.S. dollar and KRW 1,100 to the U.S. dollar. For 2018 to 2020, we have established hedges for approximately 90% of our expected display earnings. We expect these hedges to result in an average rate of JPY 107 to the dollar, and we plan to use that rate for our core reporting over the next 3 years. Additionally, we will use a constant rate of KRW 1,175 to the dollar, which is closely aligned to our current won portfolio of foreign currency hedges.

我們的非GAAP或核心結果，透過採用與我們日圓與韓元換算避險一致的固定匯率，並調整其他不反映持續營運的項目，為營運提供更高透明度。在2015年至2017年，我們的核心報導採用固定匯率：日圓兌美元99、韓元兌美元1,100。在2018年至2020年，我們已就約90%的預期顯示器獲利建立避險。我們預期這些避險將帶來平均匯率約為日圓兌美元107，並計畫在未來三年以該匯率作為核心報導基礎。此外，我們將採用韓元兌美元1,175的固定匯率，該匯率與我們目前韓元外匯避險組合高度一致。

Nearly all the analysts covering Corning are already publishing estimates for 2018 and beyond at a yen exchange rate of approximately JPY 107 to the dollar. For today's discussion, I will present fourth quarter and full year 2017 core results at the [99] rate. My comments on our 2018 outlook will be based on 170 -- JPY 107 per dollar. And 2017 results will be recast to our new core rates for comparison. We provided 2016 and 2017 results recast to the new core rate in an 8-K so you can update your models and compare our operating results on an apple-to-apples basis.

幾乎所有追蹤康寧（Corning）的分析師，已經在約每美元兌日圓 107（JPY 107）的匯率假設下，發布了 2018 年及之後的預估。就今天的討論而言，我將以 [99] 匯率呈現 2017 年第四季與全年核心業績。我對 2018 年展望的評論將以 170 -- 每美元兌日圓 107（JPY 107）為基礎。而 2017 年的結果也將依我們新的核心匯率重編，以便比較。我們已在一份 8-K 中提供按新核心匯率重編的 2016 與 2017 年結果，方便各位更新模型，並以同一基準（apple-to-apples）比較我們的營運表現。

Turning to taxes. Our full year and fourth quarter 2017 core results have been adjusted to exclude $1.8 billion in noncash items related to U.S. tax reform. The majority of the $1.8 billion is a onetime toll charge of approximately $1.2 billion on unremitted foreign earnings. The cash cost is almost entirely offset by our foreign tax credit carryforwards. We have also revalued our deferred tax assets and liabilities. While we are still finalizing the impacts of reform on our effective tax rate for 2018, we expect it to increase to between 20% and 22%. In 2018, our projected tax rate will reflect the new lower U.S. tax rate, offset by anti-base erosion provisions. The net impact does not fully replace the benefit of our previously available foreign tax credit planning. Near term, tax reform provides greater flexibility in accessing our non-U. S. cash, and we have already benefited from that flexibility. Longer term as we execute on our growth initiatives and our U.S. income grows, we will further benefit from the lower tax rate in United States. As a final note, our investment and shareholder distribution targets in the 2016 to 2019 strategy and capital allocation framework are not impacted by tax reform.

接著談稅務。我們 2017 年全年與第四季的核心業績已調整，排除與美國稅改相關的 18 億美元非現金項目。這 18 億美元中的大部分，是對未匯回海外盈餘一次性徵收的約 12 億美元過路費（toll charge）。其現金成本幾乎完全由我們的外國稅額抵免結轉（foreign tax credit carryforwards）所抵銷。我們也已重新評價遞延所得稅資產與負債。雖然我們仍在敲定稅改對 2018 年有效稅率的影響，但我們預期有效稅率將上升至 20% 至 22% 之間。2018 年，我們預估的稅率將反映新的較低美國稅率，但會被反稅基侵蝕條款（anti-base erosion provisions）所抵銷。淨影響無法完全取代我們先前可透過外國稅額抵免規劃所取得的利益。短期而言，稅改讓我們在動用非美國現金方面更具彈性，而我們本月已經受益於這項彈性。S. 現金，而且我們已經從這項彈性中受益。長期而言，隨著我們推動成長計畫且美國境內所得增加，我們將進一步受益於美國較低的稅率。最後補充一點：我們在 2016 至 2019 年策略與資本配置架構中的投資與股東分配目標，不受稅改影響。

Now let's look at our results and outlook.

現在我們來看業績與展望。

For the fourth quarter, core sales were up 7% year-over-year and EPS was $0.49. Full year sales rose 8%, and EPS was up 11% to $1.72. Core earnings were $1.8 billion, consistent with 2016. An apples-to-apples comparison that reflects the strategic realignment of Dow Corning by excluding silicone's equity earnings from the first half of 2016 shows that core earnings grew 5% year-over-year.

第四季核心銷售額年增 7%，每股盈餘（EPS）為 0.49 美元。全年銷售額成長 8%，EPS 年增 11% 至 1.72 美元。核心獲利為 18 億美元，與 2016 年一致。若以同一基準比較，並反映道康寧（Dow Corning）策略性重整、將 2016 年上半年矽利康（silicones）的權益法收益排除後，核心獲利年增 5%。

As Wendell mentioned, gross and operating margin dollars grew more slowly than sales in the back half of 2017 primarily because of plant and very attractive growth investments. These include capacity expansions for optical fiber and cable; our Gen 10.5 Hefei display glass plant; capacity for gas particulate filters; plus development for Gorilla Glass, Valor and a few other projects that we're not quite ready to dive into publicly.

如 Wendell 所提到，2017 年下半年毛利與營業利益金額的成長速度低於銷售額，主要因為工廠以及極具吸引力的成長投資。這些投資包括：光纖與光纜的產能擴充；我們合肥的第 10.5 代顯示玻璃工廠；汽油微粒濾清器（GPF）的產能；以及 Gorilla Glass、Valor 與其他幾個我們尚未準備好對外公開深入說明的專案之開發。

Turning to the balance sheet. We ended the year with $4.3 billion of cash. With the new flexibility created by U.S. tax reform, we brought $2 billion in cash back to the United States already this month. Adjusted operating cash flow for the year was $2.6 billion and keeps us on track to meet the goals of our 4-year capital allocation plan.

接著看資產負債表。我們在年底持有 43 億美元現金。在美國稅改帶來的新彈性下，我們本月已將 20 億美元現金匯回美國。全年調整後營運現金流為 26 億美元，使我們持續朝 4 年期資本配置計畫的目標邁進。

Now let's look at detailed segment results and outlook, beginning with Display Technologies.

現在我們來看各事業部門的詳細業績與展望，先從顯示科技（Display Technologies）開始。

Display's 2017 core sales were $3.4 billion, and core earnings were $944 million. Fourth quarter 2017 volume was up slightly sequentially, exceeding our guidance and in line with the market. Sequential LCD glass pricing declines were slightly better than quarter 3 and better than expected. For the full year, our volume was up mid-single digits, in line with our expectations. Pricing improved and reached single-digit year-over-year declines in both quarter 3 and quarter 4.

顯示事業 2017 年核心銷售額為 34 億美元，核心獲利為 9.44 億美元。2017 年第四季出貨量較前一季小幅上升，超出我們的指引，並與市場一致。LCD 玻璃價格的季比下滑幅度略優於第三季，也優於預期。全年而言，我們的出貨量呈中個位數成長，符合預期。價格走勢改善，且在第三季與第四季的年比降幅皆收斂至個位數。

Let's turn to 2018. We expect further pricing improvement, with year-over-year declines reaching mid-single digits. Reaching mid-single-digit annual declines is an important milestone toward our goal of stabilizing returns in display, and it's occurring earlier than the view we communicated to investors in June 2017.

接著看 2018 年。我們預期價格將進一步改善，年比降幅可達中個位數。年降幅達到中個位數是朝我們「穩定顯示事業報酬」目標邁進的重要里程碑，而且其發生時間早於我們在 2017 年 6 月向投資人所傳達的看法。

3 factors drive our view of a more favorable pricing environment. First, we expect glass supply to be balanced or even tight. Our Gen 10.5 plant supports the expected growth of large-size TVs. This is colocated with and dedicated to our customer BOE. We pace that aligned capacity in tandem with BOE to ensure our Gen 10.5 glass supply is balanced to demand. We expect glass supply-demand balance below Gen 10.5 to tighten further because demand continues to grow in 2018 but public information indicates there is little capacity growth planned in this segment by glass makers. Second, our competitors continue to face profitability challenges at current pricing levels. Therefore, we expect their price declines will flow further as they try to remain profitable. Third, LCD glass manufacturing requires ongoing investment in current and new capacity to support growth. To generate acceptable returns on investments, glass pricing will need to improve even further.

有 3 項因素支撐我們對更有利定價環境的看法。第一，我們預期玻璃供給將維持平衡，甚至偏緊。我們的第 10.5 代工廠支援大尺寸電視的預期成長。該工廠與客戶京東方（BOE）共址，並專供 BOE。我們會與 BOE 同步調整這部分配套產能的節奏，以確保第 10.5 代玻璃供給與需求維持平衡。我們預期在第 10.5 代以下的玻璃供需平衡將進一步收緊，因為 2018 年需求持續成長，但公開資訊顯示玻璃製造商在此區段規劃的產能成長有限。第二，我們的競爭對手在目前的價格水準下仍面臨獲利挑戰。因此，我們預期他們為了維持獲利，價格下滑的幅度將進一步收斂。第三，LCD 玻璃製造需要持續投資於既有與新增產能以支援成長。為了讓投資取得可接受的報酬，玻璃價格還需要進一步改善。

We typically see the largest quarterly price change in the first quarter. In quarter 1 2018, we expect sequential glass price declines to again be moderate and more favorable than first quarter sequential price changes in recent years. In sum, pricing will be favorable in 2018.

我們通常在第一季看到最大的單季價格變動。在 2018 年第一季，我們預期玻璃價格的季比下滑仍將溫和，且將比近年第一季的季比價格變動更為有利。總結而言，2018 年的定價將偏向有利。

Let's turn to volume. We expect the LCD glass market volume to grow mid-single digits as television screen size growth continues. We expect our volume to grow faster than the market as we ramp production in tandem with BOE's Gen 10.5 demand in Hefei. With the first quarter of 2018, we expect both the LCD glass market and our volume to decline sequentially by low single digits, in line with normal seasonality. First quarter volume will be up low single digits on a year-over-year basis.

接著看出貨量。我們預期隨著電視螢幕尺寸持續增大，LCD 玻璃市場出貨量將呈中個位數成長。隨著我們在合肥與 BOE 的第 10.5 代需求同步拉升產量，我們預期自身出貨量將快於市場成長。進入 2018 年第一季，我們預期 LCD 玻璃市場與我們的出貨量將因季節性因素而季比下滑低個位數，符合正常季節性。第一季出貨量在年比基礎上將成長低個位數。

We feel good about price and volume. And gross margins should improve throughout the year. 2 factors will dampen display's gross margin percentage in the first quarter of 2018. First, we are starting up our Hefei facility. As always, during a plant startup, fixed costs and staffing ramp ahead of production. Second, we'll be taking advantage of the seasonally lighter volume in display and Gorilla to rebuild tanks and optimize the fleet with our latest technology. As you may recall, in the third and fourth quarters of 2017, we ran a handful of tanks outside of optimal range to meet strong demand. We'll be correcting this in the first half. The higher utilization at the Hefei plant and the fleet optimization will improve productivity and gross margin, especially in the second half of the year.

我們對價格與出貨量都很有信心。而毛利率應會在全年逐步改善。有兩項因素將壓抑 2018 年第一季顯示事業的毛利率百分比。第一，我們正在啟動合肥廠。一如以往，在工廠啟動期間，固定成本與人力配置會先於產出爬升。第二，我們將利用顯示與 Gorilla 事業在季節性淡季的較低出貨量，進行熔爐（tanks）重建，並以最新技術優化整體產線配置。各位或許記得，在 2017 年第三季與第四季，我們為了滿足強勁需求，曾讓少數熔爐在非最佳區間運轉。我們將在上半年加以修正。合肥廠更高的稼動率與產線優化將提升生產力與毛利率，尤其是在下半年。

In summary, we have essentially all of our 2018 volume under contract. We remain very pleased with the current dynamics in our display business and our progress in maintaining stable returns.

總結來說，我們基本上已將2018年的全部出貨量納入合約。我們對顯示器業務目前的市場動態以及我們在維持穩定報酬方面的進展仍感到非常滿意。

Let's move to Optical Communications. Full year sales were $3.5 billion, up 18%. And core earnings were up 33%. Fourth quarter sales grew 13% over last year. Fourth quarter earnings declined slightly as we invested to support growth in 2018 and beyond. In addition to new fiber and cable capacity, we invested in building supply chain and new products for Saudi Telecom. Our first significant sales occurred during the quarter and required some setup costs. We're honored to support Saudi Telecom as it begins the largest network build in the history of the kingdom.

接下來談光學通訊。全年銷售額為35億美元，成長18%。核心盈餘成長33%。第四季銷售額較去年成長13%。第四季盈餘小幅下滑，因為我們投入資源以支援2018年及未來的成長。除新增光纖與纜線產能外，我們也投資建立供應鏈並為沙烏地電信開發新產品。我們在本季出現首筆具規模的銷售，並需要一些前置建置成本。我們很榮幸能支援沙烏地電信，因其正展開王國史上最大規模的網路建設。

In the first quarter and for full year 2018, we expect sales to be up about 10% year-over-year, excluding any contribution from the pending acquisition of 3M's communications markets division. Key growth drivers include strong demand from carrier and enterprise customers that will fill new capacity as we bring it online. We expect profitability to improve through the course of the year as we ramp our plants to meet committed customer demand. For your modeling purposes: We expect the 3M transaction to close in the middle of 2018. The transaction will add about $200 million in sales and be neutral to EPS in 2018 due to integration costs. As previously announced, we expect it will be accretive in 2019 and beyond.

在第一季以及2018全年，我們預期銷售額年增約10%，不包含尚待完成的3M通訊市場事業部收購案所帶來的任何貢獻。主要成長動能包括來自電信營運商與企業客戶的強勁需求，隨著我們將新增產能上線，這些需求將填滿新產能。隨著我們逐步提升工廠產能以滿足客戶已承諾的需求，我們預期獲利能力將在全年過程中改善。供您建模參考：我們預期3M交易將於2018年年中完成。該交易將增加約2億美元的銷售額，並因整合成本在2018年對EPS影響為中性。如先前所宣布，我們預期其將在2019年及之後帶來增益（具增厚效果）。

Stepping back. We're excited about 2018's growth potential for Optical Communications and pleased to have additional opportunities ahead of us.

退一步來看。我們對光學通訊在2018年的成長潛力感到振奮，也很高興未來仍有更多機會。

Environmental Technologies 2017 sales were $1.1 billion, up 7%, driven by worldwide growth in the auto market and from winning additional business, which allowed us to grow faster than the market. Fourth quarter sales grew 19% year-over-year, with core earnings rising 33%. As anticipated, the North American heavy duty market improved in the second half of the year, driving 7% growth in our diesel sales for 2017. In addition, our gasoline particulate filter business delivered its first commercial sales in the third quarter as the initial phase of Euro 6 regulations took effect in September 2017. In the fourth quarter, we had additional sales and we won additional platforms. We have won the majority of platforms awarded to date.

環境技術2017年銷售額為11億美元，成長7%，主要受全球汽車市場成長以及我們贏得更多業務所帶動，使我們得以快於市場成長。第四季銷售額年增19%，核心盈餘成長33%。如預期，北美重型車市場在下半年改善，帶動我們2017年柴油相關銷售成長7%。此外，隨著Euro 6法規的第一階段於2017年9月生效，我們的汽油微粒濾清器（GPF）業務在第三季實現首次商業銷售。第四季我們有更多銷售，並贏得更多平台。截至目前，我們已贏得已授予平台中的大多數。

2017 core earnings were $139 million, as investments in select capacity and engineering to support the ramp of our GPF business partially offset the benefits of increasing sales.

2017年核心盈餘為1.39億美元；為支援GPF業務放量，我們在特定產能與工程方面的投資，部分抵銷了銷售增加所帶來的效益。

In the first quarter and for full year 2018, we expect high single-digit sales growth driven by continued strength in auto sales, ongoing improvements in the heavy-duty diesel market and from the GPF launch.

在第一季以及2018全年，我們預期銷售額將呈現高個位數成長，動能來自汽車銷售持續強勁、重型柴油市場持續改善，以及GPF的上市推進。

In Specialty Materials, 2017 sales rose 25% over last year, and core earnings were up 32%. We're clearly benefiting from the rapid adoption of Gorilla Glass 5 and the trend for glass backs on devices. We also made progress with our innovations in other areas, including Gorilla Glass emerging as the most widely used cover material on smart watches worldwide. Fourth quarter sales increased 17%, and core earnings were up 12% year-over-year. Sales benefited from brands building aggressively to support their launch cycles. This demand pull-in is the primary reason we expect first quarter 2018 sales to be down about 10% year-over-year.

在特殊材料方面，2017年銷售額較去年成長25%，核心盈餘成長32%。我們顯然受惠於Gorilla Glass 5的快速採用，以及裝置採用玻璃背蓋的趨勢。我們在其他領域的創新也有所進展，包括Gorilla Glass成為全球智慧手錶最廣泛使用的覆蓋材料。第四季銷售額成長17%，核心盈餘年增12%。銷售受惠於品牌為支援其產品上市週期而積極備貨。這種需求提前拉貨是我們預期2018年第一季銷售額將年減約10%的主要原因。

Overall, we remain very pleased with our performance in Specialty Materials. We expect to grow again for the full year 2018, following our strong 2017. The 2018 growth rate will depend on new model launches and the adoption of our innovations. In the second half of 2018, we expect year-over-year growth as customers launch their new products; and as we announce new innovations to meet customer needs in mobile consumer electronics, including the introduction of our next generation of Gorilla Glass.

整體而言，我們對特殊材料的表現仍感到非常滿意。在2017年強勁表現之後，我們預期2018全年將再次成長。2018年的成長率將取決於新機型上市以及我們創新技術的採用情況。在2018年下半年，隨著客戶推出新產品，以及我們宣布新的創新以滿足行動消費性電子客戶需求（包括推出下一代Gorilla Glass），我們預期將出現年對年成長。

In Life Sciences, 2017 sales were $879 million and core earnings were $80 million, with strong fourth quarter sales, as we continued to outpace market growth. For full year 2018, we expect sales to grow mid-single digits. First quarter sales should be up high single digits year-over-year.

在生命科學方面，2017年銷售額為8.79億美元，核心盈餘為8,000萬美元；第四季銷售強勁，因為我們持續跑贏市場成長。2018全年我們預期銷售額將呈現中個位數成長。第一季銷售額應可年增高個位數。

As a reminder, my comments on our 2018 outlook are based on the new JPY 107 and KRW 1,175 core rates. We're comparing to 2017 results recast to our new core rates.

提醒一下，我對2018年展望的評論是以新的核心匯率：日圓107與韓元1,175為基礎。我們是將2017年的結果依新的核心匯率重編後進行比較。

For 2018, all of our businesses have positive momentum. And we expect full year sales of about $11 billion, up 7%. We expect the full year gross margin to exceed 41%, similar to 2017. The first quarter will be the low point for the year. We expect gross margin to be about 40% of sales, consistent with 2017's fourth quarter. In the second half of 2018, our investments, for example, in the Gen 10.5 facility, gas particulate filter capacity and new fiber and cable plants will exit the startup phase and result in new sales. Quarterly gross margin should exceed 42% in the second half.

就2018年而言，我們所有業務都具備正向動能。我們預期全年銷售額約110億美元，成長7%。我們預期全年毛利率將超過41%，與2017年相近。第一季將是全年低點。我們預期毛利率約為銷售額的40%，與2017年第四季一致。在2018年下半年，我們的投資（例如Gen 10.5廠、汽油微粒濾清器產能，以及新的光纖與纜線工廠）將走出啟動期並帶來新增銷售。下半年單季毛利率應可超過42%。

Annual operating expenses should remain consistent with last year as a percentage of sales. For the full year, SG&A is expected to be about 14% of sales, and RD&E about 8%. The slides will show and give you additional details for the first quarter and for the year. In other items, we expect other income, other expense to remain at our fourth quarter 2017 run rate, generating a net expense of approximately $200 million for the year or about $45 million to 50 -- $55 million in Q1.

年度營業費用占銷售額比重應與去年一致。全年而言，SG&A預期約占銷售額14%，RD&E約占8%。投影片將展示並提供第一季及全年更多細節。在其他項目方面，我們預期其他收入、其他費用將維持在2017年第四季的運行水準，全年淨費用約2億美元，或第一季約4,500萬至5,000萬—5,500萬美元。

Full year 2018 total gross equity earnings are expected to be similar to 2017 at approximately $200 million, predominantly from Hemlock Semiconductor, with first quarter at about $25 million to $30 million, consistent with typical seasonality. As a reminder, our tax rate should be between 20% and 22% for the year and for the first quarter.

2018全年總股權法收益（稅前）預期與2017年相近，約2億美元，主要來自Hemlock Semiconductor；第一季約2,500萬至3,000萬美元，符合典型季節性。提醒一下，我們全年及第一季的稅率應介於20%至22%。

In 2018, we expect to spend slightly more than $2 billion on capital expenditures, with programs in every market access platform. How much more will depend on how quickly we ramp some of our investments. We'll provide more information as the year progresses.

在2018年，我們預期資本支出將略高於20億美元，且每個市場進入平台都有相關計畫。增加多少將取決於我們提升部分投資產能的速度。我們將在年度進行過程中提供更多資訊。

Stepping back. The fourth quarter marks the halfway point of our 4-year strategy and capital allocation framework. And I'll conclude with a look on our accomplishments and our expectations. In brief, our progress on all dimensions in the framework has been excellent, and we expect to deliver on all of our goals.

退一步來看。第四季標誌著我們四年策略與資本配置框架的半程點。最後我將回顧我們的成果與預期。簡而言之，我們在該框架各個面向的進展都非常出色，並預期能達成所有目標。

In the first 2 years of the framework, our cash generation has been on target. We have invested $4.5 billion in planned investments to grow and extend our leadership, and we have returned more than $9 billion to shareholders from share repurchases and dividends. Over the next 2 years of the framework, we plan to invest an additional $5.5 billion in our growth initiatives. And we plan to continue repurchasing shares and paying dividends, totaling at least $3.5 billion additional dollars over the remainder of the program. We expect our board to increase the dividend by at least 10% next week and at least 10% again in 2019.

在該架構的前2年，我們的現金創造一直符合目標。我們已投入45億美元於既定投資，以推動成長並延伸我們的領導地位，同時也透過庫藏股回購與股利，向股東返還超過90億美元。在該架構接下來2年，我們計畫在成長計畫上再投資55億美元。此外，我們計畫持續回購股票並發放股利，在計畫剩餘期間合計至少再返還35億美元。我們預期董事會將於下週把股利至少提高10%，並在2019年再至少提高10%。

Putting it all together. As we invest $10 billion to drive growth and extend our leadership, we are rewarding our investors by returning more than $12.5 billion, which compounds the benefit of our future growth for long-term shareholders.

把這些整合起來。當我們投資100億美元以驅動成長並延伸領導地位的同時，我們也透過返還超過125億美元來回饋投資人，這將為長期股東複利放大未來成長的效益。

We are very pleased with our continued positive momentum. We're focused on keeping that momentum heading into 2018. We remain on track to deliver the goals of our strategy and capital allocation framework and are excited about the rich set of opportunities ahead of us.

我們對於持續的正向動能感到非常滿意。我們專注於在邁入2018年時維持這股動能。我們仍按計畫推進，以達成我們的策略與資本配置架構目標，並對前方豐富的機會感到振奮。

With that, let's move to Q&A. Ann?

接下來，我們進入問答。Ann？

Thank you, Jeff.

謝謝你，Jeff。

Jon, let's open the lines for questions. We have live folks in the queue today. (Operator Instructions)

Jon，請開放電話線供提問。今天佇列中有現場來電者。(接線員指示)

(Operator Instructions) I'll first go to the line of George Notter with Jefferies.

(接線員指示) 我先接 Jefferies 的 George Notter 這一線。

I guess I wanted to dig into the optical business a bit. You guys are adding a lot of capacity here. I saw the announcement from the other day about the new cable manufacturing facility. I guess the question here is can you refresh us on the amount of new capacity you're adding in that business and then also the timing with which that capacity comes online.

我想更深入了解一下光學業務。你們在這裡新增了很多產能。我看到前幾天關於新電纜製造設施的公告。我的問題是，你們能否更新一下在該業務新增產能的規模，以及這些產能上線的時間點。

Thanks, George. We're not giving exact guidance on how much capacity we're adding, for obvious competitive reasons. We launched on this latest round of capacity expansion really anchored by the Verizon announcement and their commitment to $1 billion over the next few years. That, together with a few other building blocks with key customer-committed demand, had us really start to expand our capacity footprint across all those products that they'll be requiring. What you can expect on timing, as you sort of heard from Jeff, is that investment in capacity has been a bit of a drag on our profitability in the back half of 2017 and the first half of 2018. And you're going to feel those plants ramp up and increase their utilization in the back half of 2018. So they'll turn from a drag to being a real force for positive momentum in the back half

謝謝你，George。基於顯而易見的競爭因素，我們不會提供新增產能的精確指引。我們啟動這一輪最新的產能擴張，主要是以 Verizon 的公告及其未來幾年投入10億美元的承諾為核心。再加上其他幾個關鍵客戶承諾需求的基石，促使我們開始擴大在所有其所需產品上的產能版圖。至於時程，如同你從 Jeff 那裡聽到的，產能投資在2017年下半年與2018年上半年對我們的獲利能力造成了一些拖累。而在2018年下半年，你會感受到這些工廠逐步爬坡並提高稼動率。因此，它們將從拖累轉為在下半年帶來正向動能的真正力量

(technical difficulty)

(技術問題)

Is that helpful? Okay.

這樣有幫助嗎？好的。

Our next question is from Vijay Bhagavath with Deutsche Bank.

下一個問題來自德意志銀行（Deutsche Bank）的 Vijay Bhagavath。

And we will move on to Mehdi Hosseini with SIG.

接著我們將轉到 SIG 的 Mehdi Hosseini。

I'm looking at the display as a percentage of net income. And the mix has steadily declined. Back in 2013, it was in the high 60%. And now it is almost 50%. As you accelerate the investment in other areas, like what happened in the second half of '17, should we also expect an acceleration in this decline in display net income as a percentage of overall net income? I'm just trying to better understand how other segments are going to grow and help continue to diversify the revenue and operating income mix.

我在看顯示業務占淨利的比例。而其組合占比一直在下降。回到2013年時，比例在60%後段。而現在幾乎是50%。當你們加速在其他領域的投資（例如2017年下半年發生的情況）時，我們是否也應預期顯示業務淨利占整體淨利的比例下降會加速？我只是想更了解其他事業部將如何成長，並協助持續分散營收與營業利益的組合。

So I think you've got it, Mehdi. I think your observation on what's happened in the past and your projection of what's in the future is directionally correct. Our other market access platforms are going to grow faster than our display market access platform. And therefore will -- it will become a smaller part of our overall corporate mix on income.

我想你抓到重點了，Mehdi。我認為你對過去發生的情況的觀察，以及你對未來的推估，在方向上是正確的。我們其他的市場進入平台（market access platforms）將比顯示市場進入平台成長更快。因此——它在我們整體公司獲利組合中的占比將會變小。

I guess the question is, since you have a stepped-up investment in other areas, should we expect an acceleration in contribution from other segments?

我的問題是，既然你們加大了對其他領域的投資，我們是否應預期其他事業部的貢獻會加速提升？

Yes.

是的。

Would you like to elaborate on the rate of increase?

你願意就成長加速的幅度多說一些嗎？

No. It's just [not for the queue, that is]. There's only so much guidance we really want to give and project mainly because we don't want to -- everything has arc of probability sets to it, but I think in general you're on track with it. As you heard from Jeff, it was he's expecting $11 billion of revenue this year, right, with the bulk of that revenue growth coming from other segments other than display. I think -- that type of numbers that you saw that you can interpolate from there and what you saw through 2017, I think directionally that's the way to think about it going forward: very strong growth for the company overall, with display being stable. Certainly, with the pricing dialogue you heard from Jeff, there is a possibility that displays as a segment begins to grow some, but still it'll be at a lower rate than the rest of the company, I believe.

不。只是[不適合在這個提問佇列中談]。我們願意提供與推估的指引有限，主要是因為我們不想——所有事情都有其機率弧線，但我認為整體而言你的理解是正確的。如同你從 Jeff 那裡聽到的，他預期今年營收為110億美元，對吧，而其中大部分的營收成長將來自顯示以外的其他事業部。我認為——你可以從那裡以及你在2017年看到的數字去做推算；方向上，未來應該這樣看：公司整體非常強勁的成長，而顯示業務維持穩定。當然，依你從 Jeff 那裡聽到的定價對話，顯示業務作為一個事業部也有可能開始出現一些成長，但我相信其成長率仍會低於公司其他部分。

And next we'll go to Steven Fox with Cross Research.

接下來我們將轉到 Cross Research 的 Steven Fox。

Two questions from me, please. First of all, on the gross margin swing during 2018, can you give us an idea of how you -- how much of the swing is just from ramping down some of the spending versus expecting new volumes to ramp in the second half? And then as a follow-up, can you just give us a little bit better color on some of the Gorilla Glass auto wins maybe just by large buckets of interior versus exterior and how you expect that to -- how you expect to realize revenues from that?

我有兩個問題。首先，關於2018年毛利率的波動，你們能否讓我們了解一下——這個波動有多少只是因為部分支出逐步下降， versus 預期下半年新出貨量爬坡所帶來的影響？接著作為追問，你們能否就 Gorilla Glass 在汽車領域的一些得標案提供更清楚的說明，例如大致區分內裝與外裝的大類別，以及你們預期將如何從中實現營收？

Steve, when we open any new plant, the staffing and fixed costs tend to ramp earlier than the production. We have committed demand for these plants. And as we move to higher utilization rates due to volume increases and meeting this committed demand, we would expect our gross margins to improve throughout the year, with especially strong growth in the second half.

Steve，每當我們開設任何新工廠，人員配置與固定成本通常會比產量更早爬升。我們對這些工廠有已承諾的需求。隨著我們因應產量增加並滿足這些承諾需求而提高稼動率，我們預期毛利率將在全年逐步改善，且下半年成長尤其強勁。

And on auto, Steve, did I hear your question right, how we're feeling about the ramp and the mix between glazing exterior versus interior...

至於汽車方面，Steve，我是否正確理解你的問題：我們如何看待爬坡，以及外裝玻璃（glazing exterior）與內裝之間的組合……

Yes. I was just trying to understand, like if you looked at the 35 new wins, sort of what kind of buckets they fall into within the vehicle location, whether outside, inside; what type of things inside; and when would these programs start to ramp.

是的。我只是想了解一下，如果看那35個新得標案，它們在車內不同位置大致落在哪些類別：車外、車內；車內又是哪些類型；以及這些專案何時會開始爬坡。

The majority of the platform wins that we have right now are on the interior. One of the reasons for that is people refresh interiors and adopt new design in interiors much more rapidly than they refresh the exterior of car platform. So the majority of those are interiors. I think that, though, when we think through the revenue opportunity, we don't see a lot of difference between the revenue opportunity in interiors and exteriors. Even though the glass area is quite higher in exterior, the relatively higher value that we add in interior with special optical surfaces to create a particular viewing experience means that that's quite a high-revenue-realization business for us, so I would say determining between the two probably isn't as important as the overall rate of adoption as we try to drive this business to another $1 billion sort of revenue generator for Corning over time.

我們目前拿下的平台得標案，多數是在內裝。其中一個原因是，相較於更新車款平台外觀，人們更新內裝並在內裝採用新設計的速度要快得多。因此多數都在內裝。不過，我認為當我們評估營收機會時，並不認為內裝與外裝的營收機會有很大差異。即使外裝的玻璃面積更大，但我們在內裝透過特殊光學表面來創造特定觀看體驗所增加的相對更高價值，意味著這對我們而言是營收實現度很高的業務；因此我會說，區分兩者可能不如整體採用速度重要，因為我們希望隨時間推進，將這項業務再打造為 Corning 另一個約10億美元等級的營收引擎。

And this will be for 2019, 2020 model year vehicles.

而這將適用於 2019、2020 車型年度的車輛。

We'll start shipping commercially for those products late this year, right? We'll begin, but you won't start to see a significant ramp 'til starting in 2019 and beyond. You should look for when we start to put in some high-volume manufacturing for the part finishing and optical treatments. And it should give you some more evidence. And you should hear about that sometime this year, Steve.

我們會在今年稍晚開始對這些產品進行商業出貨，對吧？我們會開始，但要到 2019 年及之後你才會看到顯著的放量爬坡。你應該關注我們何時開始導入一些高產量製造，用於零件後段加工與光學處理。這應該會給你更多佐證。而你應該會在今年某個時候聽到相關消息，Steve。

Our next question is from Wamsi Mohan with Bank of America Merrill Lynch.

下一個問題來自美國銀行美林（Bank of America Merrill Lynch）的 Wamsi Mohan。

So I was just wondering around these price declines. It sounded from your Q1 commentary that there was an improving but higher than mid-single-digit decline, which would improve that pricing improves more so throughout the course of the year post Q1. I appreciate your volumes are lower in Q1 relative to full year, but is 2Q the right time frame to think about price declines to get to mid-single digit? And secondarily, I know Tony in the past has said that the core rate could be locked-in maybe over a 5-year period. Is the FX volatility causing you to rethink the period of locking-in the core rate at this JPY 107 for 3 versus 5 years?

我想問一下關於這些價格下滑的情況。從你們對第一季的評論聽起來，價格下滑正在改善，但仍高於中個位數的下滑幅度；而在第一季之後，隨著年度進程推進，定價會進一步改善。我理解你們第一季的出貨量相較全年偏低，但第二季是否是可以期待價格下滑回到中個位數的合適時間點？另外，我知道 Tony 過去曾說核心匯率可能可以鎖定大約 5 年。外匯波動是否讓你們重新思考：在日圓 107 這個核心匯率水準下，鎖定 3 年而不是 5 年？

Thanks for the questions, Wamsi. To the first one, on pricing. So let's make sure we're talking about the right terms. There's no sequential price declines, say, quarter 4 and quarter 1, for instance. And then there's year-over-year declines, quarter 1 this year versus quarter 1 last year. What you heard from Jeff was that we are talking now about the really important milestone of, towards the back half of this year, we expect the year-over-year decline to be mid-single digits, okay? That's a very significant milestone. The sequential declines is where you have been of low single digit and continue to be. We're seeing improvement in this quarter 1 decline versus quarter 1 of last year. And of course, we're going to continue to see improvement in the sequential declines to be able to reach this much longer year-over-year decline rate, but that little shift in terms can lead to misunderstanding. I think the key thing is we see the rate of price decline improving for us. And we would expect to see that especially in the back half of the year, that we have evidence for it already in quarter 1. And we would anticipate it as well in quarter 2.

謝謝你的提問，Wamsi。先回答第一個，關於定價。我們先確認一下討論的是正確的概念。例如第四季到第一季，並不存在逐季的價格下滑。而另一種是年對年下滑，也就是今年第一季相較去年第一季。你從 Jeff 那裡聽到的是：我們現在談的是一個非常重要的里程碑——在今年下半年，我們預期年對年下滑會是中個位數，好嗎？這是一個非常重要的里程碑。逐季下滑則是你們一直看到的低個位數，且仍將維持。我們看到今年第一季相較去年第一季的下滑幅度正在改善。當然，我們也會持續看到逐季下滑的改善，以便達到這個更長期間的年對年下滑率；但這些用語上的小差異可能會造成誤解。我認為關鍵是：我們看到價格下滑的速度正在對我們有利地改善。我們預期在下半年會特別明顯；我們在第一季已經看到證據，也預期第二季同樣如此。

With respect to hedging, we find giving a 3-year core rate to be effective. It's a good window to provide certainty for our cash flows and earnings. It allows us to execute in a focused way our strategy and capital allocation framework and deliver on all the goals. Consistent with our financial policies, we do have hedges in place for the next 3-year period but at lower coverage than the 90% we have through the end of 2020. So we'll give you more details on how we expect our core rate to evolve as we get closer to the next 3-year period.

就避險而言，我們認為提供 3 年期的核心匯率是有效的。這是一個很好的期間窗口，可為我們的現金流與獲利提供確定性。它也讓我們能以更聚焦的方式執行策略與資本配置框架，並達成所有目標。依照我們的財務政策，我們已為接下來 3 年建立避險部位，但覆蓋率低於我們截至 2020 年底所維持的 90% 覆蓋率。因此，當我們更接近下一個 3 年期時，我們會提供更多細節，說明我們預期核心匯率將如何演變。

And the next question, we'll go to Vijay Bhagavath with Deutsche Bank.

下一個問題是德意志銀行（Deutsche Bank）的 Vijay Bhagavath。

My question is around your optical portfolio and 5G in particular. 5G, if you'd agree with me, is fundamentally different from previous wireless generations. 5G uniquely needs both wireless and optical communications, so my question is around would you focus primarily on the optical communications opportunity in 5G. Or any thoughts on building up a wireless communication portfolio for 5G now that the fixed wireless is starting to pick up and then we're getting to mobility in 5G?

我的問題是關於你們的光學產品組合，特別是 5G。如果你同意我的看法，5G 在本質上與先前的無線世代不同。5G 獨特之處在於同時需要無線與光通訊；所以我的問題是：在 5G 上，你們是否會主要聚焦於光通訊的機會？或者，隨著固定無線開始升溫、而我們也正邁向 5G 的移動性，你們是否有任何想法要建立一個 5G 的無線通訊產品組合？

An excellent question, Vijay. I think your assessment of the difference between 5G wireless technology and previous generations is accurate in that wireless now becomes a very optically rich offering as people move towards dense 4G and 5G. As far as expanding outside of optical, mainly our focus will be on those things that are fully integrated into our passive optical system. Where we can uniquely be able to package and/or facilitate the implementation of wireless for our customers, we would augment our offering, but that is a dialogue which we're involved with deeply with our key customers. And it's really quite straightforward. It becomes, "Do you want us to do this? Or do you want to source it? And what is the least-expensive way to build out this infrastructure?" So depending on how those dialogues go, more of the value could shift [into us] beyond the optical, but I think it's too soon yet to conclude where those dialogues will end, Vijay.

很好的問題，Vijay。我認為你對 5G 無線技術與前幾代差異的判斷是正確的：當人們走向更密集的 4G 與 5G 時，無線如今變成一個高度「光學化」的方案。至於擴展到光學以外，我們的重點主要會放在那些能完整整合進我們被動光學系統的項目。在我們能以獨特方式為客戶進行封裝與/或促成無線導入的地方，我們會擴充我們的產品供應；但這是一個我們正與關鍵客戶深入進行的對話。而且其實相當直接。問題會變成：「你希望我們來做這件事嗎？還是你希望自行採購？建置這套基礎設施最便宜的方式是什麼？」因此，視這些對話的走向，更多價值可能會從光學以外的部分轉移到[我們這邊]，但我認為現在要下結論這些對話最終會落在哪裡還太早，Vijay。

Wendell, truly helpful. A quick follow-on: As you bring up more optical fiber capacity -- I mean I keep seeing these blurbs on the news wire you're going to -- keep continue to build up new optical manufacturing capacity. Will that have any near-term impacts on segment margins?

Wendell，這真的很有幫助。我再快速追問：當你們提升更多光纖產能時——我的意思是，我一直在新聞快訊上看到一些短訊說你們將要——持續擴建新的光學製造產能。這會對各事業部門的利潤率在短期內造成任何影響嗎？

Yes, excellent question, Vijay. As you will have heard from Jeff, it's we've had from our investments in optical a bit of a drag in the back half of 2017. And we're having a bit of a drag here in the first quarter of 2018. We would expect, as those facilities ramp, that that drag will disappear and then turn into a strong positive. As you know, having visited our Optical Communications plant, our fixed cost in those facilities is high, so our variable margins are also quite high. So as we fill that up, you can expect to see it have a pretty potent effect on our gross margins.

是的，很好的問題，Vijay。如同你從 Jeff 那裡聽到的，我們在光學方面的投資在 2017 年下半年帶來了一些拖累。而在 2018 年第一季也有一些拖累。我們預期，隨著這些設施產能爬坡，那些拖累會消失，並轉為強勁的正面貢獻。如你所知，你曾參觀過我們的光通訊工廠，這些設施的固定成本很高，因此我們的變動毛利也相當高。所以當我們把產能填滿時，你可以預期它會對我們的毛利率產生相當強的拉抬效果。

Our next question is from Patrick Newton with Stifel.

下一個問題來自 Stifel 的 Patrick Newton。

Wendell and Jeff, I wanted to dig a little bit more into gross margin, perhaps a 2-part question. So I guess I'm struggling to see how the commentary on several segments running at full capacity exiting the year results in the 4Q gross margin missing your guide by about 100 bps. And I -- it appears to me that the comments that you're making on investment headwinds seem to be more targeted at the first half of '18, so maybe you can help us bridge the 41% gross margin results relative to the 42% guide. And then if we look forward and taking into account that a substantial portion of your growth is coming from some larger on -- some lower-margin businesses, how should we think about gross margin post investment phase? I think that you've talked about a 42% gross margin in the back half of the year, but is that a good intermediate-term target, meaning that 43%-plus that we saw on the 2014, '15 time frame is unachievable given mix going forward?

Wendell 和 Jeff，我想更深入探討一下毛利率，可能是兩個部分的問題。我想我有點難理解：你們提到有幾個事業部在年底退出時是滿載運轉，這樣的評論如何會導致第四季毛利率比你們的指引低了大約 100 個基點。而且——在我看來，你們提到的投資逆風似乎更偏向於 2018 年上半年，所以也許你們可以幫我們把 41% 的毛利率結果與 42% 的指引之間的差異串起來。另外，如果往前看，並考量你們相當大一部分的成長來自一些較大型、但——一些較低毛利的業務，我們應該如何看待投資期結束後的毛利率？我想你們談到下半年 42% 的毛利率，但這是否是一個良好的中期目標？也就是說，考量未來產品組合，2014、2015 年期間我們看到的 43% 以上是否已經無法達成？

Great question, Patrick. Well, let's start with Q4. So in Q4, we're also seeing that drag from our investment cycles. And you're having -- what can cause timing delta is that, as we actually start up a plant, then there are certain costs that are triggered -- that were sitting in a project now flow through our P&L and our gross margins. So some of that's hitting quarter 4, as well as you may have seen the announcement from Saudi that -- of the major new strategic alliance we've announced. That also started to shift. And so there we had to build a new supply chain, and that added (inaudible) about 4 generations of product for them. So it's a new product, new supply chain. And so as we started to shift that, that -- also its profitability was not at the level that it will be ultimately. So I think really, quarter 4 and quarter 1, it's the same basic story, a little bit different mix where the investment is, but you're seeing that strong investment take away from some of the strength in the overall operations. And we'd expect that to reverse, and I'll turn it over to Jeff, for the back half, but you're right on the target for our gross margins. So Jeff?

好問題，Patrick。我們先從第4季開始。第4季我們同樣看到投資週期帶來的拖累。而造成時點差異的原因之一是：當我們實際啟動一座工廠時，會有一些成本被觸發——原本在專案中資本化或暫置的成本，會開始流入損益表（P&L）並影響毛利率。因此其中一部分在第4季反映出來；另外你可能也看到沙烏地方面宣布——我們公布了一項重大的全新策略聯盟。那也開始帶來轉移。因此我們必須建立新的供應鏈，並且為他們新增（聽不清）大約4個世代的產品。所以這是新產品、新供應鏈。而當我們開始轉移時——其獲利能力也尚未達到最終應有的水準。所以我認為第4季與第1季基本上是同樣的故事，只是投資落點的組合略有不同，但你看到的是強勁投資在一定程度上抵消了整體營運的一些強勢表現。我們預期這會反轉；至於下半年我交給Jeff說明，但你對我們毛利率的判斷非常到位。Jeff？

At our new core rates of JPY 107 per dollar and KRW 1,175 per dollar, the 2017 gross margin was 41.3%. We expect to be about at that this year. On first quarter, we're going to be at 40%. In the back half of the year, for quarters 3 and quarter 4, we'd expect to be above 42%. The 2 primary drivers of that are that our new factories will exit the startup stage as we ramp to meet the committed demand. And then the second factor is we're taking advantage of the seasonally lighter demand in display to upgrade our display tanks with the latest technology, and that will also have a strong benefit in the back half of the year.

以我們新的核心匯率：1美元兌107日圓、1美元兌1,175韓元計算，2017年毛利率為41.3%。我們預期今年大致也會在這個水準。第1季我們將在40%。在下半年，也就是第3季與第4季，我們預期會高於42%。主要有兩個驅動因素：第一，我們的新工廠在產能爬坡以滿足已承諾需求的過程中，將會走出啟動期。第二個因素是，我們利用顯示器需求季節性較淡的時段，將顯示用熔槽（display tanks）升級為最新技術，這也會在下半年帶來顯著效益。

And next we'll go to Stanley Kovler with Citi Research.

接下來我們請Citi Research的Stanley Kovler提問。

Just more question on display and then a follow-up on the optical side. Panel makers have commented recently that they wanted to refocus on profitability. And so one question was for 2017, for example, when in the second half of the year there was more discounting to get inventory moving in China. How should we think about those types of developments going forward when maybe panel makers or OEMs will be less inclined to discount to get volume through? Your thoughts would be great.

我還有一個關於顯示器的問題，然後再追問一個光通訊方面的問題。面板廠最近評論說他們想把重心拉回獲利能力。所以其中一個問題是：以2017年為例，下半年為了讓中國的庫存加速去化，折扣力度更大。展望未來，當面板廠或OEM可能不太願意透過降價折扣來衝量時，我們應該如何看待這類發展？想聽聽你們的看法。

So we think that the supply chain inventory in our -- exited 2017 at a healthy level, and we think it will be healthy throughout 2018 as we see growth at the retail level. In terms of impact on us, we think that the glass market volume is going to be up mid-single digits. And we believe that our pricing can reach mid-single-digit year-over-year declines. We think that pricing is going to be driven by 3 things: the supply-demand balance, competitor profitability of glass makers and also the need for attractive returns on ongoing investments. And if you look over the last 3 years, correlation between panel makers, performance and glass pricing has been very well. So we feel pretty confident in our guidance.

我們認為，我們的供應鏈庫存在2017年底——已回到健康水位，而且隨著零售端成長，我們認為2018年全年都會維持健康。就對我們的影響而言，我們認為玻璃市場出貨量將有中個位數成長。我們也相信，我們的價格可能達到年對年中個位數的下滑。我們認為定價將由三個因素驅動：供需平衡、玻璃製造商競爭對手的獲利能力，以及持續投資所需的具吸引力報酬。若回顧過去三年，面板廠的表現與玻璃價格之間的相關性一直非常好。因此我們對我們的指引相當有信心。

Stan, was that the question you were asking, sir? Or were you aiming more at the display market?

Stan，先生，這是你要問的問題嗎？還是你更想問顯示器市場本身？

Appreciate it. No, that was the question. I just wanted to follow up on optical related to Verizon. They announced some NG-PON capabilities, I think, that allow them multiple wavelengths on a single fiber for some of the EDGE deployments. And I think the focus more with some of these technologies was to get speed up on a single wavelength. Does this have any implication for you guys on demand or ramp of single-mode fiber? Is this an accelerator, or could this actually slow things down for you?

謝謝。不，那就是我想問的。我想再追問一個與Verizon相關的光通訊問題。他們宣布了一些NG-PON能力，我想是允許在單一光纖上使用多個波長，用於某些EDGE部署。而我認為這些技術的重點之一，是在單一波長上提升速率。這對你們在單模光纖需求或爬坡上有任何影響嗎？這會加速，還是反而可能讓你們的進展變慢？

So in general what drives our demand is going to be footprint by neighborhood or by sea. It is putting the -- in telecom it is putting in place the original infrastructure to being able to service. As always, when you put in something like GPON, the capability of the fiber is always well in excess of what you're driving it at. And so quite often, what you'll see is our demand comes when we basically do the home passes, and then ultimately the home drops. And then always the telecom company can turn up the rate and turn up the service level with pretty simple upgrades in their GPON system inside sort of the network itself. So this is very typical. And we don't see it as impacting us, frankly, one way or the other either negatively or positively other than, to the extent that the degree with which our customers serve their customers better, that in long term turns into more demand for us.

一般而言，驅動我們需求的會是覆蓋範圍（footprint），以社區或以海纜等方式來看。在電信領域，關鍵在於先建置原始基礎設施，才能提供服務。一如既往，當你部署像GPON這樣的系統時，光纖本身的能力通常遠高於你當下實際使用的負載。因此很多時候，我們的需求會在我們完成「家戶覆蓋」（home passes），以及最終的「入戶引接」（home drops）時出現。之後電信公司總是可以透過在其網路內部、也就是GPON系統端相對簡單的升級，就把速率開上去、把服務等級開上去。所以這是非常典型的情況。坦白說，我們不認為這會對我們造成不論正面或負面的影響；唯一的例外是，若我們的客戶能更好地服務他們的客戶，長期而言就會轉化為我們更多的需求。

Jon, we'll try to get a couple more people in.

Jon，我們再讓幾位提問。

And next we'll go to James Faucette with Morgan Stanley.

接下來請Morgan Stanley的James Faucette。

I just wanted to get a little more color on growth drivers for Specialty Materials and optical and displays. It's that, Wendell, you touched a little bit about interior glass starting to move specialty or starting to contribute in really in 2019. How should we think about it as a growth driver for Specialty Materials overall? Can it be meaningful in that 2019 as a contributor? Or is it going to take longer than that? And I guess in light of your recent comments on this call related to Iris, a similar question on Iris: Can Iris be a meaningful contributor to display in 2019? Or once again, is that going to take longer?

我想更了解一下特殊材料（Specialty Materials）、光通訊與顯示器的成長驅動因素。Wendell，你稍早提到車內玻璃正開始走向特殊材料，或是在2019年才會真正開始貢獻。我們應該如何把它視為特殊材料整體的成長驅動？它在2019年就能成為有意義的貢獻者嗎？還是會需要更久？另外，結合你們在這通電話中對Iris的近期評論，我也想問類似問題：Iris在2019年能否對顯示器業務做出有意義的貢獻？還是同樣需要更長時間？

So let's start with your first question. Just from a segment sort of accounting method, right now we account for auto in the glass area inside Other, right? Ultimately, I don't agree determined whether it is the segment, but it ranks more closely with our automotive market access platform than it does our mobile consumer electronics platform. That being said, because what you really care about is it -- does it generate revenue or not, I think 2019 will be the year, if everything goes well, that we'll start to feel it in automotive. We're a big company and this is just the beginning of this, so it's not going to be a life-changing feel in 2019, okay? But we'll expect it to be -- really start to build its momentum in 2019 and then start to really contribute much more in the next decade. So in the near term, what drives us in specialty is really the adoption of our new innovations by more and more of the OEMs. And we expect specialty to grow this year in mobile consumer electronics. The rate of growth will depend on how quickly people adopt our innovation sets. In Iris it's still too early to tell. I think it's very encouraging that 2 major players in monitors in Dell and Lenovo have adopted the Iris technology for the top of their line. I think we need to see that become a lot more mainstream before that turn some of the investment area into a margin producer.

我們先回答你的第一個問題。就事業部的會計分類方式而言，目前我們把汽車相關的玻璃業務列在Other裡，對吧？最終我還沒有決定它會歸在哪個事業部，但它與我們的汽車市場進入平台（automotive market access platform）更為接近，而不是我們的行動消費電子平台。話雖如此，因為你真正關心的是它——是否能帶來營收，我認為如果一切順利，2019年會是我們開始在汽車領域感受到它的年份。我們是一家大型公司，而這只是剛開始，所以2019年不會是那種足以改變公司面貌的感受，好嗎？但我們預期它會在2019年真正開始累積動能，並在下一個十年開始做出更大的貢獻。所以短期內，驅動我們特殊材料成長的，主要是越來越多OEM採用我們的新創新。我們預期今年特殊材料在行動消費電子領域會成長。成長速度將取決於市場採用我們創新組合的速度。至於Iris，現在還太早下定論。令人鼓舞的是，顯示器（monitor）領域的兩大主要玩家Dell與Lenovo，已在其旗艦產品採用Iris技術。我認為我們需要看到它更廣泛地成為主流，投資領域才會轉化為毛利的貢獻者。

And we'll go to Joseph Wolf with Barclays.

接下來我們請巴克萊的 Joseph Wolf 提問。

I had a question back to display but on the transition in the industry towards OLED and not on the TV set but on the smaller panel size; and the lower -- and the -- I guess, the Gen 6, 6.5. Competitively, is there any impact? I know you guys are involved in OLED manufacture, but are your competitors involved in the same way? And is there any longer-term consideration where the other businesses or your competition is looking at the OLED opportunity differently than Corning?

我有一個關於顯示器的問題，但重點在於產業朝向 OLED 的轉型，不是指電視機，而是較小尺寸的面板；以及較低世代——我想是第 6 代、6.5 代。在競爭面上，這會有任何影響嗎？我知道你們參與 OLED 製造，但你們的競爭對手是否也以同樣方式參與？以及從更長期來看，其他業務或你們的競爭對手是否以不同於康寧的方式看待 OLED 的機會？

So could you just build on your question? When you say OLED, sir, which -- what exactly do you mean?

所以你能再補充一下你的問題嗎？先生，你說的 OLED 是指——你具體指的是什麼？

Anywhere -- both in flexible and in rigid, where I know that Corning product is used in the fab -- in the manufacture of the end product but perhaps isn't in the final device. And I'm wondering if you believe that your competitors have the same sort of manufacturing capability. Or they are looking at that market differently.

任何地方——包括可撓式與硬式；我知道康寧的產品用在晶圓廠——在終端產品的製造過程中，但可能不在最終裝置裡。我想知道你是否認為你們的競爭對手具備同樣類型的製造能力。或者他們是以不同方式看待那個市場。

Actually, it's not how our competitors are looking at it. Let me share instead how we think about it. Starting back a number of years ago as we evaluated OLED versus LCD technology, we determined that OLED would probably be most successful in the flexible small mobile area because it offered some unique performance advantages that were highly valued. So therefore, that's where we focused a lot of our innovation effort, and our share in that business is impressively high. So to the extent that devices go into OLED in mobile consumer electronics, as opposed to LCD, that is a revenue enhancer for us. Now it's a small revenue enhancer because in glass the area of the device matters. And so overall mobile is a relatively small percent of the overall glass demand. What we've felt then and we continue to feel is that OLED for TV can become a player but a small player, that fundamentally it doesn't offer enough value relative to the cost increase versus the continually improving LCD technologies, like you just saw recently at CES with some of the quantum dot technologies. That being said, we have a strong position as well really any time anybody wants to use the glass. So I don't have great -- sort of great insights into how do our competitors feel about it, but I really like our position.

其實重點不在於我們的競爭對手怎麼看。我改為分享我們怎麼看。從多年前開始，當我們評估 OLED 與 LCD 技術時，我們判斷 OLED 可能在可撓式、小尺寸的行動領域最成功，因為它提供了一些獨特且高度被重視的效能優勢。因此，我們把大量創新投入在那裡，而我們在該業務的市占率高得令人印象深刻。所以在行動消費性電子裝置中，只要從 LCD 轉向 OLED，對我們而言就是營收的增益。不過這是小幅的營收增益，因為在玻璃領域，裝置的面積很重要。因此，整體而言，行動端只占整體玻璃需求相對小的比例。我們當時的看法、以及現在仍然的看法是：OLED 在電視上可以成為一個參與者，但會是小的參與者；根本原因是，相較於成本的增加，它相對於持續進步的 LCD 技術並未提供足夠的價值——就像你最近在 CES 看到的一些量子點技術。話雖如此，只要有人想用玻璃，我們也都擁有很強的地位。所以我對於競爭對手怎麼想沒有特別——算是特別深入的洞見，但我很喜歡我們目前的定位。

That will be from Doug Clark with Goldman Sachs.

接下來是高盛的 Doug Clark。

I had a question on the display glass volume expectations. First, for the market being up mid-single digits in 2018, can you explain what that means from a TV unit standpoint? TV units have been down for the past few years. I'm wondering if you're assuming a re-acceleration in growth. And then secondly, on Corning's share gains and the relationship with BOE driving above-market volume growth, can you quantify that? Should we be expecting a high single-digit glass volume growth for Corning in 2018? So essentially the materiality of BOE in 2018.

我有一個關於顯示玻璃出貨量預期的問題。首先，針對 2018 年市場成長中個位數（中段），你能說明這在電視出貨台數的角度代表什麼嗎？過去幾年電視台數一直在下滑。我想知道你們是否假設成長會重新加速。第二，關於康寧的市占提升，以及與 BOE 的合作帶動高於市場的出貨量成長，你能量化一下嗎？我們是否應該預期康寧 2018 年玻璃出貨量成長達到高個位數？也就是 BOE 在 2018 年的重要性（影響程度）。

Sure. We expect screen size to be the primary driver of growth this year. And in terms of our growth, BOE is ramping its Gen 10.5 facility. We're ramping our glass in tandem, so we expect stability in other areas and that to be a little adder for us, but that's all the guidance we're giving at this time.

當然。我們預期今年成長的主要驅動因素會是螢幕尺寸。就我們的成長而言，BOE 正在爬坡其第 10.5 代產線。我們也同步爬坡玻璃供應，因此我們預期其他領域維持穩定，而這會對我們帶來一些小幅加分；但目前我們就只提供到這樣的指引。

Great. All right, thank you all for joining us today.

很好。好的，感謝各位今天加入我們。

Before we close, I just wanted to remind you that we will issue an 8-K today with our core data recast to a yen of JPY 107 and a won of KRW 1,175. We'll be attending the Goldman Sachs conference on February 13. And we'll be planning to attend at least one conference a corner for each quarter for the rest of the year. We'll also be providing some virtual presentations and webcasts on business topics throughout the year.

在結束之前，我想提醒各位：我們今天會發布一份 8-K，將我們的核心數據以日圓 JPY 107 與韓元 KRW 1,175 的匯率重新編列。我們將於 2 月 13 日出席高盛會議。並且我們計畫在今年剩餘時間裡，每一季至少參加一場會議。我們也會在全年就各項業務主題提供一些線上簡報與網路直播。

Finally, there will be a web replay of today's call on our website starting later this morning and a telephone replay available for the next 2 weeks, with details in today's news release.

最後，今天電話會議的網路重播將於今天稍晚在我們網站上線，並提供未來兩週的電話重播；相關細節請見今天的新聞稿。

So once again, thank you all for joining us.

再次感謝各位加入我們。

Jon, that concludes our call. Please disconnect all lines.

Jon，我們的電話會議到此結束。請斷開所有線路。