康寧 (GLW) 2022 Q4 法說會逐字稿

Welcome to the Corning Incorporated Fourth Quarter 2022 Earnings Call. (Operator Instructions) It is my pleasure to introduce to you, Ann Nicholson, Vice President of Investor Relations.

歡迎來到康寧公司 2022 年第四季度財報電話會議。 （操作員說明）很高興向您介紹投資者關係副總裁 Ann Nicholson。

Thank you, Crystal, and good morning, everybody. Welcome to Corning's Fourth Quarter 2022 Earnings Call. With me today are Wendell Weeks, Chairman and Chief Executive Officer; Ed Schlesinger, Executive Vice President and Chief Financial Officer; and Jeff Evenson, Executive Vice President and Chief Strategy Officer.

謝謝 Crystal，大家早上好。歡迎來到康寧 2022 年第四季度財報電話會議。今天和我在一起的是董事長兼首席執行官 Wendell Weeks； Ed Schlesinger，執行副總裁兼首席財務官；和執行副總裁兼首席戰略官 Jeff Evenson。

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. These 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.

我想提醒您，今天的評論包含前瞻性陳述，屬於 1995 年私人證券訴訟改革法案的含義。這些陳述涉及風險、不確定性和其他可能導致實際結果大不相同的因素。這些因素在公司的財務報告中有詳細說明。

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

您還應該注意，除非我們特別指出我們的評論與 GAAP 數據相關，否則我們將使用核心績效指標來討論我們的合併結果。我們的核心績效指標是管理層用來分析業務的非 GAAP 指標。

For the fourth quarter, the difference between GAAP and core EPS stemmed primarily from restructuring charges as well as noncash mark-to-market adjustments associated with the company's currency hedging contracts and foreign debt. In total, these increased core earnings in the fourth quarter by $256 million. As a reminder, the mark-to-market accounting has no impact on our cash flow.

對於第四季度，GAAP 與核心每股收益之間的差異主要源於重組費用以及與公司貨幣對沖合約和外債相關的非現金市值調整。總的來說，這些使第四季度的核心收益增加了 2.56 億美元。提醒一下，按市值計算的會計對我們的現金流沒有影響。

A reconciliation of core results to the comparable GAAP value can be found in the Investor Relations section of our website at corning.com. You may also access core results on our website with downloadable financials in the Interactive Analyst Center. Supporting slides are being shown live on our webcast, and we encourage you to follow along. They're also available on our website for downloading.

可以在我們網站 corning.com 的投資者關係部分找到核心結果與可比較的 GAAP 值的對賬。您還可以在我們的網站上訪問核心結果，並在交互式分析中心下載可下載的財務數據。支持幻燈片正在我們的網絡廣播中實時播放，我們鼓勵您繼續關注。它們也可以在我們的網站上下載。

And now I'll turn the call over to Wendell.

現在我會把電話轉給溫德爾。

Thank you, Ann, and good morning, everyone. Today, we reported fourth quarter and full year 2022 financial results. Throughout the year, a series of pandemic-driven effects continued to ripple across the global economy. Nevertheless, we executed well to grow sales and advanced strategic initiatives, while addressing the implications that the current environment poses for margins and cash generation.

謝謝你，安，大家早上好。今天，我們公佈了 2022 年第四季度和全年的財務業績。全年，一系列由大流行病驅動的影響繼續波及全球經濟。儘管如此，我們在增加銷售額和推進戰略計劃方面表現出色，同時解決了當前環境對利潤率和現金產生的影響。

For the fourth quarter, sales of $3.6 billion and EPS of $0.47 were both at the high end of our guided range. And for the full year, building on our strong 2021, we grew sales by 5% to $14.8 billion and EPS by 1% to $2.09. Gross margin was 36%. Free cash flow was $1.24 billion.

第四季度，銷售額為 36 億美元，每股收益為 0.47 美元，均處於我們指導範圍的高端。全年，在我們強勁的 2021 年的基礎上，我們的銷售額增長了 5% 至 148 億美元，每股收益增長了 1% 至 2.09 美元。毛利率為 36%。自由現金流為 12.4 億美元。

I'm pleased with the sales growth we continue to deliver, despite confronting what is essentially recession level demand in markets that constitute about half of our sales. Cars, televisions, smartphones, laptops and tablets are all well below what we estimate as the normal range.

我對我們繼續實現的銷售增長感到滿意，儘管面臨著占我們銷售額一半左右的市場基本上處於衰退水平的需求。汽車、電視、智能手機、筆記本電腦和平板電腦都遠低於我們估計的正常範圍。

Now we've offset this weak consumer demand with the strength of our positions in the growing optical communications and solar markets as well as ongoing outperformance by our businesses versus our end markets. That said, profitability and free cash flow are not where we need them to be.

現在，我們憑藉在不斷增長的光通信和太陽能市場中的優勢地位以及我們的業務相對於我們的終端市場的持續出色表現，抵消了這種疲軟的消費者需求。也就是說，盈利能力和自由現金流不是我們需要的。

So I'd like to deviate from our usual format for these calls, in which I focus on our progress across our market access platforms. Today, I want to give you some insight and perspective on the external dynamics driving our financial results, and I'll discuss what we're doing to address those dynamics.

因此，我想偏離我們通常的這些電話會議格式，我將重點關注我們在市場准入平台上取得的進展。今天，我想就推動我們財務業績的外部動力向您提供一些見解和觀點，我將討論我們為解決這些動力所做的工作。

Since 2020, the external environment has been characterized by the sweeping impact of the pandemic, including supply chain disruptions, depressed productivity, large swings in consumer spending and inflation. When the pandemic hit, our core priorities were protecting our people and delivering for our customers.

2020年以來，外部環境呈現出受疫情影響廣泛的特點，包括供應鏈中斷、生產率低迷、消費支出大幅波動和通貨膨脹。當大流行來襲時，我們的核心優先事項是保護我們的員工並為我們的客戶提供服務。

So throughout 2022, we operated with elevated staffing and higher-than-normal inventory levels. In addition, persistent and sometimes quite unpredictable, inflation added to the cost of raw materials we purchased, the cost to produce and ship our products and the inventory we maintained. As a result, our growth in profitability and cash flow have lagged our sales growth.

因此，在整個 2022 年，我們的運營人員配備增加，庫存水平高於正常水平。此外，持續且有時完全不可預測的通貨膨脹增加了我們購買原材料的成本、生產和運輸產品的成本以及我們維持的庫存。因此，我們的盈利能力和現金流量增長落後於銷售額增長。

While we took action to improve profitability and cash generation throughout 2022 and made good progress during the first half of the year, it became clear that more was needed. So we took additional and significant actions in the fourth quarter, including raising prices, again, in optical communications and life sciences to more appropriately share the inflationary cost with our customers.

雖然我們在整個 2022 年採取行動提高盈利能力和現金生成，並在今年上半年取得了良好進展，但很明顯還需要更多。因此，我們在第四季度採取了額外的重大行動，包括再次提高光通信和生命科學的價格，以更適當地與我們的客戶分擔通貨膨脹成本。

Adjusting our productivity ratios to get closer to historical metrics without impacting our ability to supply and capture future growth and normalizing inventory. Because our productivity and supply chains have improved, in the near term, we expect to maintain reliable supply for our customers at current inventory levels or below. Now all of these actions will improve our margins and cash flow throughout 2023.

調整我們的生產率以更接近歷史指標，同時不影響我們供應和獲取未來增長以及使庫存正常化的能力。由於我們的生產力和供應鏈得到改善，在短期內，我們希望在當前庫存水平或更低水平下為我們的客戶維持可靠的供應。現在，所有這些行動都將在整個 2023 年提高我們的利潤率和現金流。

Now as you may have already inferred from our press release this morning, we expect both first quarter sales and profitability to be anomalous from a historical perspective. Typically, our first quarter sales declined about 5% sequentially and margins declined about 1 to 2 points. This year, we expect first quarter sales to decline by more than normal seasonality. In contrast, we expect our margins to increase sequentially due to the benefits of our recent actions.

現在您可能已經從我們今天早上的新聞稿中推斷出，從歷史的角度來看，我們預計第一季度的銷售額和盈利能力都將出現異常。通常，我們第一季度的銷售額環比下降約 5%，利潤率下降約 1 到 2 個百分點。今年，我們預計第一季度的銷售額下降幅度超過正常季節性。相比之下，由於我們最近的行動帶來的好處，我們預計我們的利潤率將連續增加。

What's driving our below seasonal outlook for the first quarter sales is the situation unfolding in China, where consumer sentiment was already low. In December, China shifted its approach to the pandemic and a significant wave of COVID outbreaks ensued. This resulted in lower consumer spending and workforce shortages, which have, in turn, impact the demand for our products as well, particularly in Display, Environmental and Specialty Materials. We expect China to overcome these issues and demand to improve, but it's too early to call the specific timing of improvements in consumer sentiments and demand. We'll keep you posted as we learn more.

導致我們對第一季度銷售低於季節性預期的原因是中國的情況正在發生，那裡的消費者信心已經很低。 12 月，中國改變了應對大流行病的方法，隨之而來的是一波重大的 COVID 疫情。這導致消費者支出減少和勞動力短缺，進而影響了對我們產品的需求，尤其是在顯示器、環境和特種材料方面。我們預計中國將克服這些問題並改善需求，但現在判斷消費者情緒和需求改善的具體時間還為時過早。當我們了解更多信息時，我們會及時通知您。

In the interim, we continue to be well positioned to capture growth and drive innovation. And as our sales grow, we expect to benefit from operating leverage and our profitability to improve further. Given -- I think it's too early to call the rebound in China, it's difficult to be definitive on our full year results. Here's what I can say.

在此期間，我們繼續處於有利地位，可以抓住增長並推動創新。隨著我們銷售額的增長，我們預計將從經營槓桿和盈利能力中受益，從而進一步提高。鑑於 - 我認為現在稱中國反彈還為時過早，很難確定我們的全年業績。這就是我能說的。

First, our quarter 1 sales are not an indication of our 2023 run rate. Second, I'd be disappointed if sales didn't grow sequentially in the second quarter, and we didn't see year-over-year growth in the second half. Finally, the benefits of our fourth quarter profit and cash flow actions will be significant throughout 2023. As we see consumer demand return and our revenues increase, we expect to see our profitability increase.

首先，我們第一季度的銷售額並不代表我們 2023 年的運行率。其次，如果第二季度銷售額沒有環比增長，我會感到失望，下半年我們也沒有看到同比增長。最後，到 2023 年，我們第四季度的利潤和現金流行動的好處將是顯著的。隨著我們看到消費者需求回升和我們的收入增加，我們預計我們的盈利能力會增加。

Now having shared our near-term perspective, I want to underscore how great we feel about our focused portfolio and long-term prospects. As we evaluate our trajectory, given the uncertainties, and there are a lot of them, one thing that is certain is the relevance of our leadership capabilities to secular trends. Across each of our markets, we are capturing a compelling set of long-term growth opportunities with more to come.

現在分享了我們的近期觀點，我想強調我們對我們專注的投資組合和長期前景的看法。當我們評估我們的軌跡時，考慮到不確定性，並且有很多不確定性，可以肯定的是我們的領導能力與長期趨勢的相關性。在我們的每個市場中，我們都在抓住一系列引人注目的長期增長機會，並且還會有更多機會。

In Optical Communications, we're building on a record $5 billion 2022. And we believe we are still in the early phases of a multiyear build cycle driven by broadband, 5G densification and cloud computing. Cable and fiber demand remains especially robust. If we could make more, we could sell more.

在光通信領域，我們將在 2022 年達到創紀錄的 50 億美元。我們相信，我們仍處於由寬帶、5G 緻密化和雲計算驅動的多年建設週期的早期階段。電纜和光纖需求仍然特別強勁。如果我們能生產更多，我們就能賣得更多。

In solar, we continue to capture significant upside tied to growth in the renewable energy industry, and we see excellent growth potential as we contribute to a sustainable U.S.-based solar supply chain and benefit from the Inflation Reduction Act. In display, we maintained stable price and a very strong market position throughout the ongoing industry correction. We expect to emerge from the correction with strengthened customer relationships of refreshed manufacturing fleet and increasing sales and profit.

在太陽能方面，我們繼續抓住與可再生能源行業增長相關的顯著優勢，並且我們看到了極好的增長潛力，因為我們為可持續的美國太陽能供應鏈做出貢獻並受益於《通貨膨脹減少法案》。在顯示器方面，我們在整個持續的行業調整中保持穩定的價格和非常強大的市場地位。我們希望通過更新製造車隊加強客戶關係以及增加銷售額和利潤來擺脫調整。

In mobile consumer electronics, we anticipate ongoing strong adoption of our innovations, and we expect to continue outperforming the markets we serve through our product leadership, our more Corning approach and our ongoing collaboration with industry leaders.

在移動消費電子產品領域，我們預計我們的創新將繼續得到廣泛採用，並且我們希望通過我們的產品領先地位、我們更康寧的方法以及我們與行業領導者的持續合作，繼續超越我們所服務的市場。

Moving to automotive. We've been outperforming the market throughout a period of industry constraint. We remain focused on building our $100 per car content opportunity, and we're pleased by our progress as evidenced by our strong growth in Automotive Glass Solutions in 2022. And we'll be ready to capture even more growth as adoption of our technology continues and car sales return.

轉向汽車。在整個行業限制時期，我們的表現一直優於市場。我們仍然專注於打造每輛汽車 100 美元的內容機會，我們對我們在 2022 年汽車玻璃解決方案的強勁增長所證明的進展感到高興。隨著我們技術的不斷採用，我們將準備好捕捉更多的增長和汽車銷售回報。

Finally, in Life Sciences, we're focused on delivering differentiated tools to support the discovery and delivery of cell-based medicines and modern drugs. Our operations are improving as the industry completes its correction from the unprecedented demand shifts caused by COVID.

最後，在生命科學領域，我們專注於提供差異化工具，以支持基於細胞的藥物和現代藥物的發現和交付。隨著行業完成對由 COVID 引起的前所未有的需求變化的修正，我們的運營正在改善。

So now I've gone through the macro uncertainty that characterizes the near term, and I've told you what we're doing to deal with those uncertainties. I also outlined the rich set of growth opportunities we're capturing over the long term. And I believe our progress so far is a testament to what we can achieve going forward.

所以現在我已經了解了近期的宏觀不確定性，並且我已經告訴你我們正在做什麼來應對這些不確定性。我還概述了我們在長期內抓住的一系列豐富的增長機會。我相信我們迄今為止取得的進展證明了我們未來可以取得的成就。

Let's take a look back at the 2020 to 2023 strategy and growth framework that we introduced in 2019, shortly before the onset of the pandemic. Our goals included sales growth at a compound annual growth rate of 6% to 8%. From 2019 through 2022, we grew at greater than 8% CAGR, even in the face of the ongoing and universally experienced external challenges.

讓我們回顧一下我們在 2019 年大流行爆發前不久推出的 2020 年至 2023 年戰略和增長框架。我們的目標包括銷售額以 6% 至 8% 的複合年增長率增長。從 2019 年到 2022 年，我們的複合年增長率超過 8%，即使面對持續不斷且普遍存在的外部挑戰。

Over the past 4 years, we've advanced significant strategic initiatives. We delivered key fiber-to-the-home and data center solutions to meet surging demand and facilitate a period of strong growth in optical communications. We delivered on our gasoline particulate filter content opportunity in automotive, and we introduced ceramic shield with Apple, both of which have driven strong outperformance versus depressed end markets.

在過去的 4 年裡，我們推進了重大的戰略舉措。我們提供關鍵的光纖到戶和數據中心解決方案，以滿足不斷增長的需求並促進光通信的強勁增長。我們在汽車中抓住了汽油微粒過濾器內容的機會，並與 Apple 一起推出了陶瓷防護罩，這兩者都推動了強勁的表現，而不是低迷的終端市場。

We [ran] our Gen 10.5 plants to extend our leadership in the glass for large televisions, and we made major progress on our emerging innovations. We gained significant traction in our Automotive Glass Solutions business, and our pharmaceutical packaging portfolio leaped forward to play a central role in the global health fight over the past 3 years. Our vials and tubing have supported the delivery now of more than 8 billion COVID-19 doses in more than 50 countries.

我們 [運行] Gen 10.5 工廠以擴大我們在大型電視玻璃領域的領先地位，並且我們在新興創新方面取得了重大進展。我們的汽車玻璃解決方案業務獲得了巨大的吸引力，我們的醫藥包裝產品組合在過去 3 年中躍升為在全球健康鬥爭中發揮核心作用。我們的藥瓶和管材現已支持在 50 多個國家/地區交付超過 80 億劑 COVID-19。

In sum, we've delivered multiyear sales growth in a challenging environment. We've extended our leadership position across our markets, and we have paved the way for future growth. I think these are outstanding achievements.

總之，我們在充滿挑戰的環境中實現了多年的銷售增長。我們已經擴大了我們在市場上的領導地位，並為未來的增長鋪平了道路。我認為這些都是傑出的成就。

Now as I wrap up my remarks, here's what I'd like to leave you with today. Since the start of the pandemic, we protected our people and, as evidenced in our sales growth, delivered for our customers. We've now completed significant additional actions to improve our profitability and cash generation.

現在，當我結束我的發言時，這就是我今天想留給你們的。自大流行開始以來，我們保護了我們的員工，並且正如我們的銷售增長所證明的那樣，我們為客戶提供了服務。我們現在已經完成了重要的額外行動，以提高我們的盈利能力和現金產生能力。

The unfolding situation in China certainly impacts our sales in the short term. But despite this, we expect to see the benefits of these recent pricing and productivity actions take hold in the first quarter.

中國不斷發展的形勢肯定會在短期內影響我們的銷售。但儘管如此，我們預計這些最近的定價和生產力行動的好處將在第一季度發揮作用。

Overall, we will continue to focus on operating each of our business as well and adjusting to meet the needs of the moment, while simultaneously advancing growth initiatives and capabilities that will drive success as the global economy stabilizes. Our focused and cohesive portfolio provides strategic resilience that is evident in our results even in the current environment. And we remain confident in our ability to deliver durable, multiyear growth with improved margins and cash generation.

總體而言，我們將繼續專注於經營我們的每項業務並進行調整以滿足當前的需求，同時推進增長計劃和能力，隨著全球經濟的穩定而推動成功。我們專注且有凝聚力的產品組合提供了戰略彈性，即使在當前環境下，我們的結果也很明顯。我們仍然相信我們有能力實現持久的多年增長，同時提高利潤率和產生現金。

Now I'll turn the call over to Ed so he can get into the details of our financial priorities, along with our results and outlook.

現在我會把電話轉給埃德，這樣他就可以詳細了解我們的財務優先事項，以及我們的結果和前景。

Thank you, Wendell. Good morning, everyone. Building on last year's strong performance, we grew full year sales 5% to $14.8 billion and EPS 1% to $2.09. We outperformed our consumer-facing end markets, we continue to capture growth in solar and we delivered record sales of $5 billion in optical communications. In total, we had a solid year, and our results reflect our resilience in the face of ongoing external challenges.

謝謝你，溫德爾。大家，早安。基於去年的強勁表現，我們全年銷售額增長 5% 至 148 億美元，每股收益增長 1% 至 2.09 美元。我們的表現優於面向消費者的終端市場，我們繼續在太陽能領域取得增長，我們在光通信領域實現了創紀錄的 50 億美元銷售額。總的來說，我們度過了堅實的一年，我們的業績反映了我們在面對持續的外部挑戰時的韌性。

As you heard from Wendell, our profitability and cash flow have lagged our strong sales growth. To address this, we took further actions, including raising prices again in Optical Communications and Life Sciences to more appropriately share the inflationary costs with our customers, adjusting our productivity ratios closer to historical metrics without impacting our ability to supply and capture future growth and reducing inventory by $115 million in the fourth quarter. We will start to see the benefits of these actions in the first quarter despite suppressed sales from the disruption and low consumer sentiment in China that Wendell described.

正如您從 Wendell 那裡聽到的那樣，我們的盈利能力和現金流已經落後於我們強勁的銷售增長。為了解決這個問題，我們採取了進一步的行動，包括再次提高光通信和生命科學的價格，以更適當地與我們的客戶分擔通貨膨脹成本，將我們的生產率調整為更接近歷史指標，同時不影響我們供應和獲取未來增長的能力，並減少第四季度庫存減少 1.15 億美元。我們將在第一季度開始看到這些行動的好處，儘管溫德爾所描述的中國的中斷和低迷的消費者信心抑制了銷售。

With that, I will turn to our fourth quarter performance. Sales in the fourth quarter were $3.6 billion and EPS was $0.47, both coming in at the high end of our guidance. Fourth quarter gross margin was 34%, down 250 basis points sequentially. And operating margin was 14%, down 290 basis points sequentially, both including the impact of reducing inventory. EPS was favorably impacted by $0.03 due to a tax adjustment. Through the third quarter, our estimated tax rate was 20.5%. Our actual 2022 tax rate was 19.3%. The required adjustment resulted in an unusually low 15% core tax rate in the fourth quarter.

有了這個，我將轉向我們第四季度的表現。第四季度銷售額為 36 億美元，每股收益為 0.47 美元，均處於我們指導的高端。第四季度毛利率為 34%，比上一季度下降 250 個基點。營業利潤率為 14%，連續下降 290 個基點，均包括減少庫存的影響。由於稅收調整，每股收益受到 0.03 美元的有利影響。到第三季度，我們估計的稅率為 20.5%。我們 2022 年的實際稅率為 19.3%。必要的調整導致第四季度 15% 的核心稅率異常低。

Now let's take a closer look at our segment results for the fourth quarter and full year, beginning with Optical Communications. Fourth quarter sales were $1.2 billion, down $122 million sequentially, reflecting the slower pacing of customer projects that we discussed on our last call. Net income was $130 million, down $53 million sequentially on lower volume and the impact of reducing inventory. The strength of the first 3 quarters of 2022 drove annual sales to an all-time high of $5 billion, reflecting a 15% increase, while net income grew 20% year-over-year to $661 million.

現在讓我們仔細看看第四季度和全年的分部業績，從光通信開始。第四季度銷售額為 12 億美元，環比下降 1.22 億美元，反映出我們在上次電話會議上討論的客戶項目節奏放緩。淨收入為 1.3 億美元，環比下降 5300 萬美元，原因是銷量下降和庫存減少的影響。 2022 年前 3 季度的強勁表現推動年銷售額達到 50 億美元的歷史新高，增長 15%，而淨收入同比增長 20% 至 6.61 億美元。

Moving to Display. On our last call, we said we believed panel maker utilization had reached bottom in September, but it was too early to call the timing or the shape of the recovery. We were then very encouraged to see panel maker utilization levels climbed in October and then again in November, indicating a recovery had begun. However, in December, China reopened and a significant wave of COVID outbreaks ensued, panel maker utilization leveled off in December and has since decreased in January. We believe that panel maker utilization will resume its recovery.

移動到顯示。在上次電話會議中，我們表示相信面板製造商的利用率已在 9 月份觸底，但現在就判斷復甦的時機或形式還為時過早。然後我們非常鼓舞地看到面板製造商的利用率水平在 10 月和 11 月再次攀升，表明復蘇已經開始。然而，在 12 月，中國重新開放，隨之而來的是一波重要的 COVID 爆發，面板製造商的利用率在 12 月趨於平穩，此後在 1 月有所下降。我們相信面板製造商的利用率將恢復復甦。

In January, panel makers are operating below the current reduced rate of demand. I'll cover more on our Display outlook in a moment. Display sales in the fourth quarter grew 14% sequentially to $783 million. Net income was $171 million, up 28% sequentially on strong execution and the additional volume. Fourth quarter glass price was consistent with the third quarter as expected. For the full year, sales were $3.3 billion and net income was $769 million, both down year-over-year, reflecting the impact of the industry correction in the second half. Glass price for the full year was consistent with 2021.

1 月份，面板製造商的運營低於當前需求下降的速度。稍後我將詳細介紹我們的顯示前景。第四季度顯示器銷售額環比增長 14% 至 7.83 億美元。淨收入為 1.71 億美元，由於執行力強和銷量增加，環比增長 28%。四季度玻璃價格與三季度一致，符合預期。全年銷售額為 33 億美元，淨收入為 7.69 億美元，均同比下降，反映了下半年行業調整的影響。全年玻璃價格與 2021 年持平。

We anticipate glass price in the first quarter of '23 to be consistent with the fourth quarter, and we expect the favorable glass pricing environment we experienced over the last few years to continue, driven by 2 factors: first, glass makers continue to align supply to demand. Corning and other glass makers have been taking additional tanks offline for maintenance and repairs after an extended period of glass tightness. As we've told you before, we are taking this opportunity to upgrade our fleet with the latest technology, and we are actively managing the timing of tank restarts to align our supply to demand.

我們預計 23 年第一季度的玻璃價格將與第四季度保持一致，我們預計我們在過去幾年中經歷的有利玻璃定價環境將持續下去，這主要受兩個因素的驅動：首先，玻璃製造商繼續調整供應要求。康寧和其他玻璃製造商在玻璃長時間密封後，已經將額外的儲罐下線以進行維護和維修。正如我們之前告訴您的那樣，我們正藉此機會使用最新技術升級我們的車隊，並且我們正在積極管理儲罐重啟的時間，以使我們的供應與需求保持一致。

Another factor is glassmakers profitability. It is challenging for glass makers who have high fixed costs to maintain profitability during this period of low volume and high inflation. We have maintained stable price and market position through this industry correction and as demonstrated in the fourth quarter when the market recovers, incrementals from our increased volume will be meaningful.

另一個因素是玻璃製造商的盈利能力。對於固定成本高的玻璃製造商來說，在這個低產量和高通脹時期保持盈利能力是一項挑戰。通過這次行業調整，我們保持了穩定的價格和市場地位，正如第四季度市場復甦所證明的那樣，我們增加的銷量增量將是有意義的。

In Specialty Materials, fourth quarter sales of $505 million were down 3%, but we outperformed our markets driven by customer product launches and continued strong demand for premium glasses and advanced optics products. Full year sales were $2 billion, flat year-over-year. Gorilla Glass sales were down 5%, outperforming the smartphone market, which was down 11% and IT market, which was down 15%. Advanced Optics grew sales 12% driven by the strength of our next-generation semiconductor equipment materials.

在特殊材料方面，第四季度銷售額為 5.05 億美元，下降了 3%，但在客戶產品發布以及對優質眼鏡和先進光學產品的持續強勁需求的推動下，我們的表現優於市場。全年銷售額為 20 億美元，同比持平。大猩猩玻璃銷量下降 5%，跑贏智能手機市場下降 11% 和 IT 市場下降 15%。 Advanced Optics 的銷售額增長了 12%，這得益於我們下一代半導體設備材料的優勢。

Full year net income was $340 million, down 8% year-over-year due to continued investment in next-generation materials for consumer electronics and semiconductor equipment as well as new markets, such as bendable devices and augmented reality.

全年淨收入為 3.4 億美元，同比下降 8%，原因是對用於消費電子和半導體設備的下一代材料以及可彎曲設備和增強現實等新市場的持續投資。

In Environmental Technologies, fourth quarter sales were $394 million, up 12% year-over-year. And net income was $69 million, up 28% year-over-year. Sequentially, fourth quarter sales were down 7%, impacted by a decline in China OEM production levels in December, driven by similar COVID dynamics I mentioned in Display.

在環境技術領域，第四季度銷售額為 3.94 億美元，同比增長 12%。淨收入為 6900 萬美元，同比增長 28%。受我在 Display 中提到的類似 COVID 動態的推動，12 月份中國 OEM 生產水平下降的影響，第四季度銷售額下降了 7%。

Full year sales of $1.6 billion were flat versus 2021 as light and heavy-duty markets in China remain weak and global auto market growth was restricted. Net income for the full year increased 9% to $292 million as we improved our productivity and raised prices.

全年銷售額為 16 億美元，與 2021 年持平，原因是中國的輕型和重型汽車市場依然疲軟，全球汽車市場增長受到限制。由於我們提高了生產力並提高了價格，全年淨收入增長了 9%，達到 2.92 億美元。

Turning to Life Sciences. Fourth quarter sales were $294 million, down sequentially and year-over-year, impacted by lower demand for COVID-related products. Fourth quarter net income was down, driven by lower sales and the impact of reducing inventory.

轉向生命科學。受 COVID 相關產品需求下降的影響，第四季度銷售額為 2.94 億美元，環比和同比下降。受銷售額下降和庫存減少的影響，第四季度淨收入下降。

Full year sales of $1.2 billion were consistent with a strong 2021, while net income was $153 million, down 21% as the unexpected shift in demand away from COVID-related products led to a significantly lower productivity in our manufacturing operations.

全年銷售額為 12 億美元，與 2021 年的強勁表現一致，而淨收入為 1.53 億美元，下降 21%，原因是需求從 COVID 相關產品的意外轉移導致我們製造業務的生產率顯著降低。

And finally, in Hemlock and emerging growth businesses, sales in the fourth quarter were $462 million, up 22% year-over-year and 14% sequentially. And full year sales were $1.7 billion, up 34% year-over-year, reflecting strong demand for polysilicon as we continue to see robust demand for both semiconductor and solar grade polysilicon. We also saw strong growth in Automotive Glass Solutions and Pharmaceutical Technologies.

最後，在 Hemlock 和新興增長業務中，第四季度銷售額為 4.62 億美元，同比增長 22%，環比增長 14%。全年銷售額為 17 億美元，同比增長 34%，反映出對多晶矽的強勁需求，因為我們繼續看到對半導體和太陽能級多晶矽的強勁需求。我們還看到了汽車玻璃解決方案和製藥技術的強勁增長。

To close out my segment recap, we're pleased that our more Corning approach and secular trends in optical and solar enabled us to grow sales and outperform our markets.

在結束我的細分市場回顧時，我們很高興我們更多的康寧方法和光學和太陽能領域的長期趨勢使我們能夠增加銷售額並跑贏市場。

Turning to our outlook. We maintain an attractive long-term trajectory and are well positioned to capture growth. Looking at the near term, typically, in the first quarter, our sales declined about 5% sequentially and margins declined about 1 to 2 points. This quarter, we expect a sequential sales decline of 6% to 11%. In contrast, with the recent price and productivity actions we've taken, we expect about a 1- to 2-point margin improvement in the first quarter.

轉向我們的前景。我們保持著有吸引力的長期發展軌跡，並有能力捕捉增長。從近期來看，通常在第一季度，我們的銷售額環比下降約 5%，利潤率下降約 1 到 2 個百分點。本季度，我們預計銷售額環比下降 6% 至 11%。相比之下，根據我們最近採取的價格和生產力行動，我們預計第一季度的利潤率將提高 1 到 2 個百分點。

In total, for the quarter, we anticipate core sales in the range of $3.2 billion to $3.4 billion and EPS in the range of $0.35 to $0.42. Our first quarter sales outlook reflects the current dynamics in China since COVID restrictions were lifted in December. The situation has impacted consumer sentiment and labor availability, which is playing out across some of the industries we serve.

總的來說，我們預計本季度核心銷售額在 32 億美元至 34 億美元之間，每股收益在 0.35 美元至 0.42 美元之間。我們的第一季度銷售前景反映了自去年 12 月解除 COVID 限制以來中國的當前動態。這種情況影響了消費者信心和勞動力供應，這在我們服務的一些行業中正在發揮作用。

For example, in Display, as I mentioned, we saw panel maker utilization decline in January back to October levels. With that, we now believe the display industry recovery has been delayed by at least a quarter. And in environmental, we expect the lower OEM production levels we saw in December to remain in the first quarter.

例如，正如我提到的，在顯示器領域，我們看到面板製造商的利用率在 1 月份下降到 10 月份的水平。因此，我們現在認為顯示器行業的複蘇至少被推遲了四分之一。在環境方面，我們預計我們在 12 月份看到的較低的 OEM 生產水平將保持在第一季度。

We will have a better feel for the situation in China after the Lunar New Year, and we'll share more with you as we go through the quarter. As a reminder, the first quarter is usually our lowest volume quarter of the year. So we expect sales to grow sequentially in the second quarter. And I'll also note that we expect 2023 full year capital expenditures to be consistent with 2022.

我們將在農曆新年後更好地了解中國的情況，並在整個季度期間與您分享更多信息。提醒一下，第一季度通常是我們一年中銷量最低的季度。因此，我們預計第二季度銷售額將環比增長。我還要指出，我們預計 2023 年全年資本支出將與 2022 年保持一致。

Before I close, I want to cover 2 other topics. First, I want to take a minute to address currency exchange rates. As a reminder, we have actively hedged our foreign currency exposure over the past decade. This serves as an effective tool to reduce earnings volatility, protect our cash flow, enhance our ability to invest and protect shareholder returns. Our largest exposure is the Japanese yen.

在結束之前，我想介紹另外兩個主題。首先，我想花點時間談談貨幣匯率問題。提醒一下，我們在過去十年中積極對沖了我們的外匯風險。這是減少收益波動、保護我們的現金流、增強我們的投資能力和保護股東回報的有效工具。我們最大的敞口是日元。

As we've previously shared with investors, we have most of 2023 hedged. We now also have most of 2024 hedged. We expect to keep our core rate at 1-0-7, at least through the end of 2024. We're very pleased with our hedging program and the economic certainty it provides. We've received more than $2 billion in cash under our hedge contracts since their inception.

正如我們之前與投資者分享的那樣，我們對 2023 年的大部分時間進行了對沖。我們現在還對 2024 年的大部分時間進行了對沖。我們希望將核心利率保持在 1-0-7，至少到 2024 年底。我們對我們的對沖計劃及其提供的經濟確定性感到非常滿意。自對沖合約成立以來，我們已收到超過 20 億美元的現金。

Second, as CFO, in addition to investing for organic growth, my top priorities include maintaining a strong and efficient balance sheet and returning excess cash to shareholders. Examples include creating one of the longest debt tenors in the S&P 500. Our current average debt maturity is 25 years, with only $1 billion in debt coming due in the next 5 years and no significant debt coming due in any given year. And our interest rate exposure is very low because essentially all our debt instruments are fixed rate.

其次，作為首席財務官，除了為有機增長進行投資外，我的首要任務包括維持強大而高效的資產負債表，並將多餘的現金返還給股東。示例包括創造標準普爾 500 指數中最長的債務期限之一。我們目前的平均債務期限為 25 年，未來 5 年內只有 10 億美元的債務到期，而且任何一年都沒有重大債務到期。而且我們的利率敞口非常低，因為基本上我們所有的債務工具都是固定利率的。

Additionally, over the last 4 years, we have consistently returned excess cash to shareholders even throughout the pandemic, and one of the ways we do that is through dividends. We have grown our dividend 35% since 2019, and we have increased our dividend for 12 consecutive years. Our dividend yield is top quartile in the S&P 500 at 3%. As we enter 2023, we will recommend that our Board approve an increase in the quarterly dividend, raising the annual rate from $1.08 to $1.12 per share.

此外，在過去 4 年中，即使在整個大流行期間，我們也始終如一地向股東返還多餘的現金，而我們這樣做的方式之一就是通過股息。自 2019 年以來，我們的股息增長了 35%，並且已連續 12 年增加股息。我們的股息收益率為 3%，在標準普爾 500 指數中名列前茅。進入 2023 年，我們將建議董事會批准增加季度股息，將年利率從每股 1.08 美元提高到 1.12 美元。

Stepping back, our long-term growth drivers all remain intact. As markets recover, sales growth will resume and we're well positioned to continue capturing growth tied to key secular trends, such as optical and solar. In the face of ongoing macroeconomic challenges, we grew our sales 5% in 2022 and delivered a CAGR of greater than 8% since 2019. We have adapted to meet near-term needs, taking actions throughout this period. And while our profitability and cash flow have been impacted, we expect to see the benefits of additional actions we took in Q4, in our Q1 results and throughout the year.

退一步說，我們的長期增長動力都保持完好。隨著市場復甦，銷售增長將恢復，我們有能力繼續抓住與光學和太陽能等主要長期趨勢相關的增長。面對持續的宏觀經濟挑戰，我們在 2022 年的銷售額增長了 5%，自 2019 年以來的複合年增長率超過 8%。我們已經適應了滿足近期需求的需求，並在此期間採取了行動。雖然我們的盈利能力和現金流受到了影響，但我們希望在第四季度、第一季度和全年的業績中看到我們採取的額外行動的好處。

With that, I'll turn it back over to Ann for Q&A.

有了這個，我會把它轉回給 Ann 進行問答。

Thank you, Ed. Crystal, we're ready for our first question.

謝謝你，埃德。 Crystal，我們準備好回答第一個問題了。

(Operator Instructions) And our first question will come from Wamsi Mohan from Bank of America.

（操作員說明）我們的第一個問題將來自美國銀行的 Wamsi Mohan。

I have one for Ed, one for Wendell. Ed, you said your core rate will be 1-0-7 through 2024, but I would imagine your transactions are increasingly happening away from this core rate. How should we think about the impact of the yen as we think about 2023 and 2024 if the hedge rate is significantly away from the core rate?

我有一份給艾德，一份給溫德爾。 Ed，你說到 2024 年你的核心利率將是 1-0-7，但我想你的交易越來越多地發生在這個核心利率之外。如果對沖利率明顯偏離核心利率，我們應該如何看待 2023 年和 2024 年的日元影響？

And for Wendell, can you talk about Corning's role in both bendable and augmented reality since Ed mentioned it in his script? I'm kind of curious on the technology that you're bringing. And b, any thoughts on commercial availability for these products, particularly by flagship customers?

至於溫德爾，你能談談自從埃德在他的劇本中提到康寧在可彎曲現實和增強現實中的作用嗎？我對你帶來的技術很好奇。 b，對這些產品的商業可用性有什麼想法，尤其是旗艦客戶？

Yes. Wamsi, this is Ed. I'll take your yen question first. So just for clarity, our hedges are actually close to our core rate in '23 and 2024. And we have most of our exposure hedged, and that's why we expect to keep our core rate at 1-0-7. With the recent strengthening in the yen in December and January, we were able to put more hedges in place for 2024.

是的。 Wamsi，這是埃德。我先回答你的日元問題。因此，為了清楚起見，我們的對沖實際上接近我們在 23 年和 2024 年的核心利率。我們對大部分風險敞口進行了對沖，這就是為什麼我們希望將核心利率保持在 1-0-7。隨著近期日元在 12 月和 1 月走強，我們能夠為 2024 年實施更多對沖。

It is -- sorry, Ed, if I could just follow up on that. Is the cost to hedge significantly different in '23 and '24?

是——抱歉，Ed，請問我是否可以繼續跟進。 23 年和 24 年的套期保值成本是否有顯著差異？

No, not significantly different.

不，沒有明顯的不同。

Thanks for your question on bendable and augmented reality. For bendable, we have 2 significant opportunities, 1 of which is we're relatively matured in, which is we make the mother glass upon which the displays are manufactured to be able to do a bendable display. Actually to make one of those displays consumes more glass than sort of a typical LCD does.

感謝您提出有關可彎曲和增強現實的問題。對於可彎曲，我們有 2 個重要機會，其中 1 個是我們相對成熟的，即我們製造製造顯示器的母玻璃能夠做可彎曲顯示器。實際上，製造其中一個顯示器比典型的 LCD 消耗更多的玻璃。

Second, where the bulk of our innovation investment -- new innovation investment has been is in the cover material for bendables. This effort has led to many of the bendable devices that you see today. It still is not a product that we believe is meeting the true needs of the customer. So we have a whole series of new innovations that we're doing to try to take that technology and make it be able to be mainstream rather than just a novelty. This effort is going to continue for the next number of years, and you can expect to see us introduce new products in that space.

其次，我們的大部分創新投資——新的創新投資都用於可彎曲的覆蓋材料。這種努力導致了您今天看到的許多可彎曲設備。它仍然不是我們認為能夠滿足客戶真正需求的產品。因此，我們正在進行一系列新的創新，以嘗試採用該技術並使其能夠成為主流，而不僅僅是一種新奇事物。這種努力將在接下來的幾年中繼續進行，您可以期待看到我們在該領域推出新產品。

In augmented reality, 2 major efforts. One is, once again, be COVID-related, and I don't want to talk about that in too much detail. And then two, is we make the material and sometimes the [wave guys] that create that digital light field in front of your eyes. And so we have significant efforts in both these areas, augmented reality, embryonic industry, but quite exciting for the long term.

在增強現實方面，有 2 大努力。一個是，再次與 COVID 相關，我不想談論太多細節。其次，我們是在製造材料，有時是 [wave guys] 在你眼前創造數字光場。因此，我們在這兩個領域都做出了重大努力，增強現實，新興產業，但從長遠來看非常令人興奮。

And our next question will come from Martin Yang from Oppenheimer.

我們的下一個問題將來自 Oppenheimer 的 Martin Yang。

My first question is about the guidance. Can you talk about the sequential growth in EPS? I think you implied from the guidance adjusting for the tax benefit, EPS decline more sequentially comparing to core revenue. Is there anything else we should be looking for, for OpEx knowing that the margin -- gross margin is likely to improve sequentially?

我的第一個問題是關於指南。您能談談 EPS 的環比增長嗎？我認為你從針對稅收優惠調整的指導中暗示，與核心收入相比，每股收益的下降幅度更大。對於知道利潤率 - 毛利率可能會連續提高的 OpEx，我們還應該尋找什麼嗎？

Martin, I'll take that one. No, I think actually, our margins, both gross and operating margin, should improve sequentially in the guidance we've given you. Obviously, we've given a range for both sales and earnings per share. And you're right, if you adjust for the tax rate, it's actually a reasonable level of incrementals on the lower sales. Remember, sales are going down 6% to 11% sequentially.

馬丁，我要那個。不，我認為實際上，我們的利潤率，包括毛利率和營業利潤率，應該在我們給你的指導中連續提高。顯然，我們已經給出了銷售額和每股收益的範圍。你是對的，如果你調整稅率，它實際上是較低銷售額的合理增量水平。請記住，銷售額連續下降 6% 至 11%。

So Martin, yes, I think you're doing your math correctly. You're seeing a pretty significant increase for us in our profitability at both the gross and operating margin lines and somewhat muted by the delta in tax rate from quarter 4 to quarter 1. I think you've got it.

所以馬丁，是的，我認為你的數學計算是正確的。您會看到我們的毛利率和營業利潤率都有相當顯著的增長，而且從第 4 季度到第 1 季度的稅率增量有所減弱。我想你已經明白了。

Got it. And then a question on automotive glass, you highlighted as one of the growth areas. Can you maybe talk about, is it more in the infotainment side? Or are you seeing adoptions for windshield and or the external glasses?

知道了。然後是關於汽車玻璃的問題，您強調這是增長領域之一。你能不能談談，它更多是在信息娛樂方面？或者您是否看到擋風玻璃和/或外部眼鏡的採用？

The bulk of our current revenues are in the interior set of products. The growth rate is highest in our exterior. What's -- you've seen all the trends on the interior with these very large curved displays being introduced in more and more products. And when that happens, that is by and large us with our patented ColdForm technology.

我們目前的大部分收入來自內飾產品。我們的外部增長率最高。什麼是——你已經看到了室內的所有趨勢，這些非常大的曲面顯示器被越來越多的產品引入。當這種情況發生時，基本上就是我們擁有專利的 ColdForm 技術。

But as well, especially with electric vehicles, because they are so quiet, you experience them as noisy, at least the outside world is more noisy. And so as a result of that and the amount of energy it takes to maintain the HVAC system within an electric vehicle, we're seeing the adoption of laminated technologies beyond the windshield in sidelights, [rooms], backlights. And quite often, that is leading to adoption of one of our new technologies, which we pair with Gorilla to create a unique laminate structure that is both performance, weight and cost advantaged. And we're seeing very nice take-up of that as well.

但同樣，尤其是電動汽車，因為它們太安靜了，你會覺得它們很吵，至少外面的世界更吵。因此，由於這一點以及維護電動汽車內的 HVAC 系統所需的能量，我們看到層壓技術在擋風玻璃之外的側燈、[房間]、背光燈中得到採用。通常，這會導致採用我們的一項新技術，我們將其與 Gorilla 搭配使用，創造出一種獨特的層壓結構，該結構在性能、重量和成本方面均具有優勢。我們也看到了很好的接受度。

And our next question will come from Samik Chatterjee from JPMorgan.

我們的下一個問題將來自摩根大通的 Samik Chatterjee。

I actually had a question or a 2-part question on display. I know you outlined your thoughts around display and the lower panel maker utilization you're seeing in 1Q. Could you just give us a bit more color on sort of what are the range of sort of volume changes you're expecting sequentially into 1Q? What sort of typical seasonality there in terms of volume? How much of a difference or variance to the normal seasonality are you expecting in Display in 1Q?

我實際上有一個問題或一個由兩部分組成的問題。我知道您概述了您對顯示器的看法以及您在第一季度看到的較低的面板製造商利用率。你能不能給我們更多的顏色，比如你期望進入 1Q 的數量變化範圍是什麼？就數量而言，那裡有什麼樣的典型季節性？您預計 1 季度的展示廣告與正常季節性有多大差異或差異？

And sir, the second part to that, I know you outlined China consumer spending as a sort of a watch point here, but any thoughts on TV sales or TV unit sales for the year, even if it's markets outside of China at this point?

先生，第二部分，我知道您在這裡將中國消費者支出概述為一種觀察點，但對今年的電視銷售或電視單位銷售有何想法，即使此時是中國以外的市場？

Samik, let me make sure I understand your first question. I understand your second one. So you're asking how we expect to see beyond quarter 1 in panel maker utilization or within the quarter?

Samik，讓我確保我理解你的第一個問題。我理解你的第二個。所以你問我們如何期望在第一季度之後或本季度內看到面板製造商的利用率？

Within the quarter, panel maker utilization and volumes related to normal seasonality in 1Q?

在本季度內，面板製造商的利用率和產量與 1Q 的正常季節性有關嗎？

Okay. So I think -- to answer the Q1 one, I'm actually going to start a little bit. I'm going to go back in time, talk a little bit about Q4. You will remember on our last quarterly conference call, what we talked about was that -- we called that panel maker utilization was at bottom in September, but it was too early to tell sort of timing and shape of the recovery.

好的。所以我想——為了回答第一季度的問題，我實際上要開始一點點。我要回到過去，談談第四季度。你會記得在我們上次的季度電話會議上，我們談到的是——我們稱面板製造商的利用率在 9 月份處於底部，但現在判斷復甦的時間和形式還為時過早。

As we entered into quarter 4, we saw a significant increase in panel maker utilization in October and then another significant increase in panel maker utilization in November. And we -- our models were telling us that information, along with panel price increases and what we were seeing in order behavior in the industry, meant that the recovery was underway and that recovery would continue to arc upwards after adjusting for seasonality through Q1 and throughout this year.

當我們進入第 4 季度時，我們看到 10 月份面板製造商的利用率顯著增加，然後 11 月份面板製造商的利用率再次顯著增加。我們——我們的模型告訴我們，這些信息，以及面板價格上漲和我們在行業中看到的訂單行為，意味著復甦正在進行中，並且在通過第一季度調整季節性因素後，復甦將繼續呈上升趨勢全年。

In December, when China changed its approach to the pandemic, we saw panel maker utilization rather than continue its next step up to sort of level off. And then as we look at January, it looks to us like as they reduced it back really about to the levels we saw in October, that the recovery is sort of delayed a quarter is the way we would tend to think about it, adjusting for seasonality.

去年 12 月，當中國改變應對大流行病的方法時，我們看到面板製造商的利用率沒有繼續上升，而是趨於平穩。然後，當我們回顧 1 月份時，在我們看來，他們確實將其降低到了 10 月份的水平，復甦有點延遲了一個季度，這是我們傾向於考慮的方式，調整為季節性。

And then that ties to your retail piece. So we would expect panel maker utilization to grow through the year because as Ed shared with you, this UT now -- the production rate is below the even relatively depressed level of set demand that we see in the end market.

然後與您的零售產品相關聯。因此，我們預計面板製造商的利用率將在今年增長，因為正如 Ed 與您分享的那樣，這個 UT 現在 - 生產率低於我們在終端市場看到的相對低迷的固定需求水平。

Which takes us to the next part of your question, which is we would expect to see the retail market recover as the year goes on. And it doesn't have to be much, even relatively flattish set demand year-over-year, given the state of panel maker utilization, will still result in pretty significant growth for us at the glass level.

這將我們帶到您問題的下一部分，即我們預計隨著時間的推移零售市場會復蘇。考慮到面板製造商的利用率狀況，它不必太多，即使是相對平穩的固定需求，仍然會在玻璃層面為我們帶來相當顯著的增長。

And our next question will come from Shannon Cross from Credit Suisse.

我們的下一個問題將來自瑞士信貸的 Shannon Cross。

I wanted to talk about Hemlock, which was an outperformer this quarter. Wendell, can you talk a bit about the long-term opportunity that you see for polysilicon and sort of the trajectory, especially with the IRA?

我想談談本季度表現出色的 Hemlock。 Wendell，你能談談你看到的多晶矽的長期機會和某種軌跡，尤其是 IRA 嗎？

And then Ed, maybe could you talk about the margin potential for this segment? Because I would assume there's a fair amount of scale leverage that's there as you're able to utilize some of the excess manufacturing capacity that you have?

然後是 Ed，也許你能談談這個細分市場的利潤潛力嗎？因為我假設存在相當數量的規模槓桿，因為您能夠利用您擁有的一些過剩製造能力？

So our goal, Shannon, we'd like to build about $1 billion solar business for us here at the company, and it could take a variety of different product forms. It's too early right now for us to make any specific announcements. But given the IRA, we see many opportunities to both grow and enhance the profitability of this business.

所以我們的目標，香農，我們想在公司為我們建立大約 10 億美元的太陽能業務，它可以採用各種不同的產品形式。現在發布任何具體公告還為時過早。但考慮到 IRA，我們看到了許多增長和提高該業務盈利能力的機會。

Again, Shannon, I would add 2 things. One, sort of Hemlock's overall gross margin is similar to our corporate average in the same zone sort of in normal circumstances, half the business or more is semiconductor and you've got solar, right? So you've got those both product sets in there. That's all within our Hemlock and emerging growth segment.

香農，我要補充兩點。第一，Hemlock 的整體毛利率在某種程度上類似於我們在同一區域的公司平均水平，在正常情況下，一半或更多的業務是半導體，你有太陽能，對吧？所以你已經擁有了這兩個產品集。這都在我們的鐵杉和新興增長領域。

And then the second thing I would add is that we have added solar capacity which was, as we described, very inexpensive capacity because it was previously mothballed. We were able to turn it back on. As we think about the next phases of growth, there may be some costs to do that and there may be just some impacts to gross margin as we go along that journey. But in the current state it's in, think of it as around the average for Corning.

然後我要補充的第二件事是我們增加了太陽能容量，正如我們所描述的那樣，這是非常便宜的容量，因為它以前被封存了。我們能夠將其重新打開。當我們考慮下一階段的增長時，這樣做可能會產生一些成本，並且在我們沿著這個旅程前進的過程中可能會對毛利率產生一些影響。但在目前的狀態下，可以將其視為康寧的平均水平。

And our next question will come from Steven Fox from Fox Advisors.

我們的下一個問題將來自 Fox Advisors 的 Steven Fox。

I was just wondering if you can maybe explain the productivity ratio improvements or the adjustments that you talked about in terms of what kind of costs were involved and what exactly you were doing there from both a near-term standpoint and what it implies for your ability to maybe control your own destiny on the cost side should end markets remain tough this year?

我只是想知道你是否可以從近期的角度以及它對你的能力意味著什麼，從涉及什麼樣的成本以及你在那裡做了什麼來解釋你談到的生產率提高或調整如果今年終端市場依然艱難，是否可以在成本方面控制自己的命運？

Yes. Thanks, Steve. Maybe the way to think about it is as we talk about what our priorities were through the pandemic, one of them was serving our customers. And we disproportionately erred on the side of being able to do that, right?

是的。謝謝，史蒂夫。也許思考它的方式是當我們談論我們在大流行期間的優先事項時，其中之一就是為我們的客戶提供服務。我們在能夠做到這一點上犯了不成比例的錯誤，對吧？

In the beginning, when inflation was coming in, we made sure that we got our customers what they needed over time, we were able to raise price and offset that. And similarly, in the production space, we did whatever we needed to do to ensure that we have the products available to ship to our customers, in a very difficult supply chain environment in a very difficult pandemic environment where being able to staff your factories, have all the materials you need and be able to make the products you need was very difficult over this sort of long sweep of time starting in '21 and running through the end of 2022.

一開始，當通貨膨脹來襲時，我們確保隨著時間的推移我們能滿足客戶的需求，我們能夠提高價格並抵消這種影響。同樣，在生產領域，我們做了我們需要做的一切，以確保我們在非常困難的供應鏈環境中，在非常困難的大流行環境中，能夠為您的工廠配備人員，將產品運送給我們的客戶，在從 21 世紀開始到 2022 年底的這種漫長的時間裡，擁有你需要的所有材料並能夠製造你需要的產品是非常困難的。

So we've been able to improve the way we operate, improve our yields, improve our staffing levels and in some cases, take some adjustments and realign our capacity to allow us to get back to what we would consider to be our benchmark or our historical productivity metrics. So making sure we have the right output at the right cost at every level in all of our factories.

因此，我們已經能夠改進我們的運營方式，提高我們的收益，提高我們的人員配備水平，並且在某些情況下，進行一些調整併重新調整我們的能力，使我們能夠回到我們認為的基准或我們的水平歷史生產力指標。因此，確保我們所有工廠的每個級別都以合適的成本提供合適的產量。

That's our objective. We're not completely there yet, but we've taken a lot more action in the fourth quarter, and we've made a significant amount of progress that will improve our cost and therefore, improve our gross margin.

這是我們的目標。我們還沒有完全做到這一點，但我們在第四季度採取了更多行動，我們取得了重大進展，這將降低我們的成本，從而提高我們的毛利率。

And just longer-term implications for all that?

只是對所有這些的長期影響？

Well, I think longer term, it almost -- if you think about it, it gets us back to being able to operate like we did pre-pandemic, right? Pre all of the supply chain disruption, we are humble, at least I will be humble here that we have been surprised by a lot of things, including this recent change in the way China has operated during the pandemic, which clearly impacts us and our customers and our suppliers.

好吧，我認為從長遠來看，它幾乎 - 如果你考慮一下，它會讓我們回到能夠像大流行前那樣運作，對吧？在所有供應鏈中斷之前，我們很謙虛，至少我在這裡會很謙虛，我們對很多事情感到驚訝，包括最近中國在大流行期間運作方式的變化，這顯然影響了我們和我們的客戶和我們的供應商。

But putting that aside, I feel like we now are able to run more like we did pre-pandemic levels, which then allows us to grow as our demand comes back and our margin should get back closer to our historical levels.

但撇開這一點不談，我覺得我們現在能夠更像大流行前的水平那樣運行，這讓我們能夠隨著需求的回升而增長，我們的利潤率應該會回到更接近歷史水平的水平。

Our next question will come from Josh Spector from UBS.

我們的下一個問題將來自瑞銀的 Josh Spector。

I was just curious in Specialty. Is there a way to think about the pace of new content wins over this next year? So you shared you grew almost 10 percentage points greater than the market in '22. How would that metric look in '23 based on what you know now?

我只是對專業感到好奇。有沒有辦法考慮明年新內容獲勝的速度？所以你分享了你比 22 年的市場增長了近 10 個百分點。根據你現在所知道的，這個指標在 23 年會如何？

We have a number of significant new content, new value-added products that will begin to be introduced for upcoming model launches. So we would expect to have sort of a more Corning dynamic happen again.

我們有許多重要的新內容、新的增值產品，這些產品將開始為即將推出的車型推出。因此，我們希望再次出現更多康寧動態。

Now the actual degree of overperformance will really depend upon the success and pace of adoption of those new innovations. So I'd like to see both, how our product does and sort of our customers' unique products using this technology does before I would characterize a specific numeric level of outperformance.

現在，超額表現的實際程度將真正取決於這些新創新的成功和採用速度。所以我想看看我們的產品是如何做的，以及我們客戶使用這種技術的獨特產品的分類，然後再描述一個特定的數字水平的優異表現。

Okay. And if I could just follow up on the cost side of things. So you talked about your productivity. Is there anything we should be considering energy or otherwise flowing through differently for you guys given your hedging strategies over the past couple of years?

好的。如果我能跟進事情的成本方面。所以你談到了你的生產力。考慮到你們過去幾年的對沖策略，我們是否應該考慮能量或以其他方式為你們帶來不同的流動？

Yes, Josh, I think with respect to inflation, as we've shared sort of throughout the year, we continue to be surprised primarily to the negative on all the things that we consider sort of input costs to run our business. Things have normalized a little bit as we come to the back half, and I think our price increases are allowing us to get to close to sort of neutrality as we go into 2023.

是的，喬希，我認為關於通貨膨脹，正如我們全年分享的那樣，我們繼續對我們認為是經營我們業務的投入成本的所有事情的負面影響感到驚訝。隨著我們進入後半段，情況已經有點正常化，我認為我們的價格上漲使我們能夠在進入 2023 年時接近某種中立。

Energy is certainly a cost that remains elevated relative to pre-pandemic levels, as do many other costs, by the way. I mean I think even though the rate of inflation has slowed and, in some cases, retracted, we're not back to pre-pandemic levels of costs for inputs. So I think it's -- energy is certainly one to watch, but nothing specific that I'd call out as we go into 2023.

順便說一下，與大流行前的水平相比，能源成本肯定仍然很高，許多其他成本也是如此。我的意思是，我認為即使通貨膨脹率已經放緩，並且在某些情況下已經回落，但我們並沒有回到大流行前的投入成本水平。所以我認為這是 - 能源當然值得關注，但在我們進入 2023 年時我不會特別指出。

I think, Josh, that we're -- we've been able to -- with the actions we took in the fourth quarter, which is pretty significant. We've been able to catch up to the inflation that we have experienced, like looking in the rearview mirror. And that's one of the reasons that we're able to have the step up in our profitability in quarter 1 or sequentially from quarter 4.

喬希，我認為我們在第四季度採取的行動非常重要，我們已經能夠做到。我們已經能夠趕上我們所經歷的通貨膨脹，就像看著後視鏡一樣。這就是我們能夠在第一季度或第四季度開始提高盈利能力的原因之一。

I think where we still have work to do is really in the area of what you're asking about, which is how accurately we see what's coming at us from an inflation standpoint and sort of getting ahead of the game. We're still working through that. Got a great team on supply chain who's trying to help us do it, but I think we need to improve there some more, Josh.

我認為我們還有工作要做的地方實際上是在你所問的領域，也就是我們從通貨膨脹的角度如何準確地看到我們正在發生的事情，並在某種程度上領先於遊戲。我們仍在努力解決這個問題。有一個很棒的供應鏈團隊正在努力幫助我們做到這一點，但我認為我們需要在這方面進行更多改進，Josh。

Our next question will come from Tim Long from Barclays.

我們的下一個問題將來自巴克萊銀行的 Tim Long。

Yes, I'd like to ask kind of a 2-parter on the optical coms business. First, kind of on the revenue side. It felt like last quarter or through the quarter, it was mostly like one large carrier that was part of the weakness. Now it seems like it's a little more distributed. It looked like enterprise was kind of weak in the quarter, and a lot of folks are worried about cloud spending into next year.

是的，我想問一下光通信業務的兩位合夥人。首先，在收入方面。感覺就像上個季度或整個季度一樣，它主要是作為弱點的一部分的大型承運人。現在好像有點分散了。看起來企業在本季度有點疲軟，很多人擔心明年的雲支出。

So can you just talk a little bit about kind of the maybe enterprise telco mix there or how you see the dynamics differently in those 2 markets? And then secondly, obviously, profitability was weak in the quarter. Could you talk about that? Is that just component cost or is there something else going on? There's a pretty big dip in profitability there.

那麼，您能否談談那裡可能存在的企業電信組合，或者您如何看待這兩個市場的不同動態？其次，很明顯，本季度的盈利能力很弱。你能談談嗎？這只是組件成本還是還有其他原因？那裡的盈利能力有很大的下降。

So I think that perhaps it was -- any other industry players who would have just said this was one player. But I've always said it is -- in the carrier space, we had a number of carriers who were pacing their projects and also relative to what they've been doing to manage their supply chains one way or the other.

所以我認為也許是——任何其他行業參與者都會說這是一個參與者。但我一直說它是——在承運人領域，我們有許多承運人正在調整他們的項目，也相對於他們一直在做的以一種或另一種方式管理他們的供應鏈。

Yes, clouds had a ton of activity as well. But by and large, we still think this is a carrier story. And we're -- we expect to work through that as we go through quarter 1 and then get the benefit of elevated demand levels as we go through the rest of the year.

是的，雲也有很多活動。但總的來說，我們仍然認為這是一個承運人的故事。而且我們 - 我們希望在我們經歷第一季度時解決這個問題，然後在我們度過今年剩餘時間時獲得需求水平上升的好處。

Yes. And I'll take the cost one or the margin one, profitability one. I think Opto is a good example of sort of all of the things we've talked about, inflation impacting the segment significantly, productivity levels impacting the segment significantly. Those things are depressing margins in optical.

是的。我將採取成本一或利潤一，盈利能力一。我認為 Opto 是我們所討論的所有事情的一個很好的例子，通貨膨脹顯著影響該細分市場，生產力水平顯著影響該細分市場。這些事情正在壓低光學領域的利潤率。

And the fourth quarter volumes also came down, and we also took inventory down in the fourth quarter in optical. And all of those things impacted our margins. So it's sort of a good example of all the things we've talked about. However, on the positive side, the actions we've talked about significantly impact optical as well. So as we go into 2023, that's a place where we would expect to see profitability improvement.

第四季度的銷量也有所下降，我們在第四季度的光學庫存也有所下降。所有這些都影響了我們的利潤。所以這是我們所討論的所有事情的一個很好的例子。然而，從積極的方面來看，我們所討論的行動也會對光學產生重大影響。因此，當我們進入 2023 年時，我們預計盈利能力將有所改善。

Our next question will come from Matt Niknam from Deutsche Bank.

我們的下一個問題將來自德意志銀行的 Matt Niknam。

Just 2 if I could. One, maybe bigger picture. As we think about maybe a slower start to the year, EPS, I think, is implied to be about $0.38 at the midpoint in 1Q. Is there any framework to use when thinking about the trajectory for EPS in 2Q onwards? And really what I'm getting at is any visibility you have towards when you get back to maybe a $2 a share sort of annualized EPS run rate?

如果可以的話，只有 2 個。一，也許更大的圖景。當我們考慮今年開局可能較慢時，我認為每股收益在第一季度的中點約為 0.38 美元。在考慮第二季度以後的 EPS 軌跡時，是否有任何框架可供使用？我真正想知道的是，當你回到每股 2 美元的年化 EPS 運行率時，你有什麼能見度？

And then maybe just a follow-on to the last question. On Optical, have you seen any inflections or resumption of activity in 1Q? And then maybe when you would anticipate a more meaningful bounce back this year?

然後也許只是最後一個問題的後續問題。在光學方面，您是否看到第一季度活動出現任何變化或恢復？然後也許你預計今年會出現更有意義的反彈？

So to the first question, what we've tried to do with our profitability actions is that to have that sort of run rate in EPS that you're talking about, that's a $2 run rate to be when we hit revenues that are like quarter 4, sort of 3.6, 3.7 level. That's when with our actions on productivity and pricing that if they are effective, which we believe they are. Then, at that revenue level, that's when you should expect that type of EPS level. That's the way we're thinking about it, and that's the way we're modeling it. Did that answer your question, sir?

所以對於第一個問題，我們試圖通過我們的盈利能力行動來實現你所說的 EPS 運行率，即當我們達到季度收入時的 2 美元運行率4、排序3.6、3.7級。那就是我們在生產力和定價方面採取的行動，如果它們有效，我們相信它們是有效的。然後，在那個收入水平上，你應該期望那個類型的 EPS 水平。這就是我們思考它的方式，也是我們對其建模的方式。先生，這是否回答了您的問題？

That does. That does. And then just on Optical, have you seen any sort of resumption or bounce back yet in 1Q?

確實如此。確實如此。然後就光學而言，您是否在第一季度看到任何形式的恢復或反彈？

Quarter 1 is like no time to call optical, right? So let me get another month or 2 into it, and we should be able to tell you how this all looks. We're very close with our customers. We're watching what they're doing. We're talking to them a lot on their project timing.

第 1 季度就像沒有時間打電話給光學，對吧？所以讓我再花一兩個月的時間，我們應該能夠告訴你這一切看起來如何。我們與客戶的關係非常密切。我們正在觀察他們在做什麼。我們就他們的項目時間安排與他們進行了很多交談。

And we just finished executing perhaps the most significant price increase -- perhaps, the most significant price increase in my 30-plus years of being associated with optical communications, and we did it successfully, which gives you an idea of the extent of planned demand in this business.

我們剛剛完成了可能是最顯著的提價——也許是我 30 多年來與光通信相關的最顯著的提價，我們成功地做到了，這讓你了解了計劃需求的範圍在這項業務中。

Our next question will come from Asiya Merchant from Citi.

我們的下一個問題將來自花旗的 Asiya Merchant。

But just on free cash flow, Ed. Just -- I know a lot of questions have been asked on revenue, sales and how you guys think about margin improvement. Can you shed some light on cash flow and your adjusted free cash flow post the levels in '22?

但只是關於自由現金流，埃德。只是——我知道有很多關於收入、銷售額以及你們如何看待利潤率提高的問題。您能否闡明現金流量以及調整後的自由現金流量是否達到 22 年的水平？

Yes, sure, Asiya. I mean I think on capital, I shared our view that we expect to hold CapEx similar in 2023 as we did to 2022, and that was sort of similar to the prior year as well. And I think what you saw in 2022 that really impacted our operating cash flow the most was the inventory build. We built about $500 million of inventory in the year. So obviously, that negatively impacts our operating cash flow.

是的，當然，阿西亞。我的意思是，我認為在資本方面，我同意我們的觀點，即我們希望在 2023 年持有與 2022 年相似的資本支出，這也與前一年相似。我認為你在 2022 年看到的對我們的經營現金流影響最大的是庫存增加。我們在這一年建立了大約 5 億美元的庫存。很明顯，這對我們的經營現金流產生了負面影響。

Our goal is to make inventory go the other way. We made a small step in the fourth quarter here. And even not building inventory, just holding inventory flat helps our cash flow going forward. So our goal is to make our operating cash flow go up, keep our CapEx flattish, and so that should make free cash flow go up. But we've got work to do to be able to do that, and it's primarily in the inventory space.

我們的目標是讓庫存從另一個方向發展。我們在第四季度在這裡邁出了一小步。甚至不建立庫存，只是保持庫存持平有助於我們未來的現金流。所以我們的目標是讓我們的經營現金流上升，保持我們的資本支出持平，這樣應該會讓自由現金流上升。但我們還有很多工作要做才能做到這一點，而且主要是在庫存空間。

Okay. And are you expecting like a lot of resumption in share buyback here? I know you talked about dividends -- an increase in dividends. How should we think about the pre -- how should we think about share repurchase in '23?

好的。你是否期待這裡的股票回購會大量恢復？我知道你談到了股息——股息的增加。我們應該如何考慮前 - 我們應該如何考慮 23 年的股票回購？

Yes, I'm not going to guide that specifically. But what I would say is our priorities are investing for organic growth, and we will continue to do that. We believe there's a lot of opportunity out there. That's sort of the highest priority for our operating cash flow, and then we want to return cash to shareholders. We shared what we plan to do on the dividend. And then, of course, buybacks are important to us.

是的，我不打算具體指導。但我要說的是，我們的首要任務是投資有機增長，我們將繼續這樣做。我們相信那裡有很多機會。這是我們運營現金流的最高優先級，然後我們希望將現金返還給股東。我們分享了我們計劃在股息方面做些什麼。然後，當然，回購對我們很重要。

As a reminder, we did a very large buyback in 2020 -- I'm sorry, 2021 with Samsung's conversion of their preferred shares. We bought back about 4% of our outstanding shares, and that sort of is still -- we're still paying for that. We've got one more tranche to pay for that in April of 2023. And then we'll have that behind us. That should give us more flexibility. And buybacks, of course, will remain important.

提醒一下，我們在 2020 年進行了一次非常大的回購——對不起，2021 年三星轉換了他們的優先股。我們回購了大約 4% 的已發行股票，這種情況仍然存在——我們仍在為此付出代價。到 2023 年 4 月，我們還有一筆款項要支付。然後我們就會把它拋在身後。這應該給我們更大的靈活性。當然，回購仍然很重要。

Operator, I think we're out of time. So I'm just going to shut us down for today. And I want to thank everybody for joining us.

接線員，我想我們沒時間了。所以我今天要關閉我們。我要感謝大家加入我們。

Before we close, I want to let you know that we're going to attend the Susquehanna Financial Group 12th Annual Tech Conference on March 2. And on March 7, we'll be attending the Morgan Stanley Technology Media and Telecom Conference.

在我們結束之前，我想告訴你，我們將參加 3 月 2 日舉行的 Susquehanna Financial Group 第 12 屆年度技術大會。3 月 7 日，我們將參加摩根士丹利科技媒體和電信大會。

Additionally, we'll be hosting some management visits to investor offices in select cities. And finally, a web play of today's call will be available on our site starting later this morning.

此外，我們將在特定城市舉辦一些對投資者辦公室的管理訪問。最後，從今天上午晚些時候開始，我們的網站上將提供今天電話會議的網絡播放。

So once again, thanks for joining us. Operator, that concludes our call. You can disconnect all lines.

再次感謝您加入我們。接線員，結束我們的通話。您可以斷開所有線路。

Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.

謝謝你。今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。每個人，祝你有美好的一天。