康寧 (GLW) 2023 Q2 法說會逐字稿

Welcome to the Corning Inc. Quarter 2 2023 Earnings Call. (Operator Instructions) It is my pleasure to introduce to you Ann Nicholson, Vice President of Investor Relations.

歡迎參加康寧公司 2023 年第二季度財報電話會議。 （操作員說明） 我很高興向您介紹投資者關係副總裁 Ann Nicholson。

Thank you. And good morning, everybody. Welcome to Corning's Second Quarter 2023 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。大家早上好。歡迎參加康寧 2023 年第二季度財報電話會議。今天與我在一起的有董事長兼首席執行官 Wendell Weeks； Ed Schlesinger，執行副總裁兼首席財務官；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，今天的言論包含符合 1995 年《私人證券訴訟改革法案》含義的前瞻性陳述。這些陳述涉及風險、不確定性和其他可能導致實際結果存在重大差異的因素。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 relate to GAAP data. Our core performance measures are non-GAAP measures used by management to analyze the business.

您還應該注意到，我們將使用核心績效指標來討論我們的綜合結果。除非我們特別指出，否則我們的評論均涉及 GAAP 數據。我們的核心績效衡量標準是管理層用來分析業務的非公認會計原則衡量標準。

For the second quarter, the difference between GAAP and core EPS stemmed primarily from restructuring charges and from noncash mark-to-market adjustments associated with the company's currency hedging contracts and Japanese yen-denominated debt. In total, these decreased core earnings in the second quarter by $19 million. As a reminder, the mark-to-market accounting has no impact on our cash flow.

第二季度，公認會計原則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同和日元計價債務相關的非現金按市價調整。總的來說，第二季度的核心收益減少了 1900 萬美元。提醒一下，按市值計價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 on our webcast. We encourage you to follow along. They're also available on our website for downloading. And now I'll turn the call over to Wendell.

您可以在我們網站 corning.com 的投資者關係部分找到核心業績與可比 GAAP 值的調節表。您還可以在我們的網站上訪問核心結果，並在交互式分析師中心下載財務數據。我們的網絡廣播中正在播放支持幻燈片。我們鼓勵您繼續關注。它們也可以在我們的網站上下載。現在我將把電話轉給溫德爾。

Thank you, Ann. Good morning, everyone. Today, we reported second quarter results to demonstrate strong progress on the priorities we've outlined to improve profitability and cash flow in the current week end market environment. Sales were $3.5 billion. EPS was $0.45. Gross margin and operating margin increased sequentially to 36.2% and 17.5%, respectively.

謝謝你，安。大家，早安。今天，我們報告了第二季度業績，以證明我們在當前週末市場環境下為提高盈利能力和現金流而概述的優先事項方面取得了強勁進展。銷售額為 35 億美元。每股收益為 0.45 美元。毛利率和營業利潤率分別增長至 36.2% 和 17.5%。

And free cash flow improved to $310 million. Ed will give you the details on each of these in just a few minutes.

自由現金流改善至 3.1 億美元。 Ed 將在幾分鐘內向您詳細介紹每一項內容。

Our results reflect solid execution on our plan to deliver financial and operational improvements in response to the significant aftereffects of the pandemic still rippling across the global economy. Now we've been discussing this plan with you for several quarters, so let me just briefly recap the primary factors we've been addressing.

我們的業績反映出我們對改善財務和運營的計劃的堅定執行，以應對仍在波及全球經濟的大流行的重大後果。現在我們已經與您討論這個計劃幾個季度了，所以讓我簡要回顧一下我們一直在解決的主要因素。

For one, supply chain disruptions caused higher logistics, freight and input costs. Additionally, inflation led to interest rate hikes, then a spike in the U.S. dollar, and consumers shifted spending from goods to services as the pandemic abated. Against this backdrop, demand grew below historic trends in end markets that constitute the vast majority of our sales.

一方面，供應鏈中斷導致物流、貨運和投入成本上升。此外，通貨膨脹導致利率上漲，然後美元飆升，隨著疫情的減弱，消費者將支出從商品轉向服務。在此背景下，終端市場的需求增長低於歷史趨勢，而終端市場構成了我們銷售額的絕大多數。

Further, as supply chains started to normalize again over the last year, our customers began to draw down inventory to facilitate their transition from just-in-case back to their typical just-in-time approach.

此外，隨著供應鏈在去年開始再次正常化，我們的客戶開始減少庫存，以促進他們從以防萬一回到典型的準時制方法的轉變。

Consequently, we're seeing a synchronization of lower sales across our portfolio that is highly unusual. Now this is because while our 3 core technologies and 4 manufacturing platforms do apply to all of our markets, the demand drivers in the different markets we serve are fundamentally uncorrelated, TV sales don't move with automotive production. The life sciences market isn't correlated with fiber optic deployments and so on.

因此，我們看到我們的產品組合銷售額同步下降，這是非常不尋常的。這是因為，雖然我們的 3 個核心技術和 4 個製造平台確實適用於我們所有的市場，但我們服務的不同市場的需求驅動因素根本上是不相關的，電視銷售不會隨著汽車生產而變化。生命科學市場與光纖部署等無關。

Over the past several quarters, I've noted how all the factors I just outlined have taken a toll on profits and cash. And that's why we introduced a comprehensive plan to improve both profitability and cash flow at our current sales run rate while also innovating to generate additional near- and longer-term revenue streams.

在過去的幾個季度中，我注意到我剛才概述的所有因素如何對利潤和現金造成影響。這就是為什麼我們推出了一項全面計劃，以當前的銷售運行速度提高盈利能力和現金流，同時進行創新以產生額外的近期和長期收入流。

I would like to now walk you through the elements of our plan and the strong results we're delivering. We're taking pricing actions, almost recently, in display. We expect these actions will contribute to overall profitability improvement in the third quarter. We've reduced our staffing levels to align with demand, and we are returning our productivity ratios to historic levels.

現在我想向您介紹我們計劃的要素以及我們正在交付的強勁成果。幾乎最近，我們正在採取定價行動。我們預計這些行動將有助於第三季度整體盈利能力的改善。我們已經減少了人員配置以滿足需求，並且我們正在將生產力比率恢復到歷史水平。

And we're bringing inventory down across the company because we no longer require buffer inventory and supply chains are improving. These sets of actions are delivering the intended results. In the first quarter, we improved gross margin by 160 basis points. And in the second quarter, we improved by another 100 basis points. Collectively, we've improved gross margin by 260 basis points to 36.2% versus where we ended 2022. As I said earlier, we also improved our free cash flow to $310 million in the quarter.

我們正在降低整個公司的庫存，因為我們不再需要緩衝庫存，而且供應鏈正在改善。這些行動正在實現預期結果。第一季度，我們的毛利率提高了 160 個基點。第二季度，我們又提高了 100 個基點。總體而言，與 2022 年末相比，我們的毛利率提高了 260 個基點，達到 36.2%。正如我之前所說，我們本季度的自由現金流也提高到了 3.1 億美元。

As we move into the second half, we're not counting on a strong recovery in our end markets or a significant increase in our sales, but we do expect our profitability and cash generation to continue going up. Importantly, our actions will further improve profitability and cash generation when our markets recover, our volume returns and our sales increase.

當我們進入下半年時，我們並不指望終端市場的強勁復甦或銷售額的大幅增長，但我們確實預計我們的盈利能力和現金生成能力將繼續上升。重要的是，當我們的市場復甦、銷量回報和銷售額增加時，我們的行動將進一步提高盈利能力和現金生成能力。

The products and services we enable, smartphones, cars, TVs, broadband, these are central to many facets of daily life. So we're confident that volume in our markets will recover to historical trend lines.

我們提供的產品和服務，智能手機、汽車、電視、寬帶，這些是日常生活許多方面的核心。因此，我們有信心市場交易量將恢復到歷史趨勢線。

In display, for example, we believe the volume recovery has already begun. When we last spoke, panel makers had started to increase utilization at the end of the first quarter. Improvement continued in the second quarter, and we grew sales more than [20%] sequentially, driven by higher volume.

例如，在顯示器行業，我們認為銷量恢復已經開始。當我們上次談話時，面板製造商已在第一季度末開始提高利用率。第二季度繼續改善，在銷量增加的推動下，我們的銷售額環比增長了 [20%] 以上。

When we couple this volume return with the display pricing actions I mentioned earlier, we expect to show additional profitability improvement in the third quarter. Now our goal is to return display to pre-pandemic profitability levels as we exit the third quarter.

當我們將銷量回報與我之前提到的顯示器定價行動結合起來時，我們預計第三季度的盈利能力將進一步改善。現在，我們的目標是在第三季度結束時將顯示器行業的盈利能力恢復到大流行前的水平。

Let me now turn to how we intend to increase our profitability and grow our sales beyond our pre-pandemic run rates.

現在讓我談談我們打算如何提高盈利能力並使我們的銷售額超越大流行前的運行率。

Across our markets, we expect demand to normalize and our volume to return. As we drive More Corning content into those markets, we will further increase our profit as we create additional revenue streams. Now here are just a few exciting examples of More Corning innovations that are arriving in the near term.

在我們的市場中，我們預計需求將正常化，銷量將恢復。隨著我們將更多的康寧內容推向這些市場，我們將進一步增加我們的利潤，創造更多的收入來源。以下是康寧近期即將推出的更多創新的一些令人興奮的例子。

In Optical Communications, [leaders] in large language models are building data centers with what is essentially a second optical network, which is increasing connectivity by up to 5x within individual data centers. So we're commercializing a Gen 2, high-density, high-value optical interconnect system, designed to enable the requirements and capture the growth driven by AI.

在光通信領域，大型語言模型的[領導者]正在利用本質上是第二個光網絡來構建數據中心，該網絡將單個數據中心內的連接性提高了多達 5 倍。因此，我們正在將第二代高密度、高價值光學互連繫統商業化，旨在滿足人工智能的需求並抓住人工智能驅動的增長。

In mobile consumer electronics, we're launching 2 products this fall and next year, featuring innovations that significantly increase our value per device.

在移動消費電子產品領域，我們將在今年秋季和明年推出 2 款產品，其中的創新產品可顯著提高我們每台設備的價值。

In automotive, we continue to increase the amount of Corning content in vehicles across the industry as we pursue our $100 per car content opportunity. We recently commercialized a solution in our auto glass exterior business that takes a significant step to achieving this goal in electric vehicles. And for ICE vehicles, adoption of our gasoline particulate filter technology is now expanding to India. And the U.S. EPA has proposed regulations that would boost our content in the very large domestic market.

在汽車領域，我們繼續增加整個行業車輛中康寧內容的數量，追求每輛車 100 美元的內容機會。我們最近將汽車玻璃外飾業務的解決方案商業化，為實現電動汽車的這一目標邁出了重要一步。對於內燃機汽車，我們的汽油顆粒過濾器技術的採用現已擴展到印度。美國環保署提出了一些法規，以提高我們在龐大的國內市場中的含量。

In Life Sciences, we just launched Viridian Vials to address the growing need for sustainable products in the pharmaceutical supply chain. Viridian cuts the CO2 emissions from biomanufacturing by about 1/3 and reduces glass by 20%, all while improving filling line efficiency by 50%.

在生命科學領域，我們剛剛推出了 Viridian Vials，以滿足藥品供應鏈中對可持續產品日益增長的需求。 Viridian 將生物製造過程中的二氧化碳排放量減少了約 1/3，玻璃用量減少了 20%，同時將灌裝線效率提高了 50%。

We're expanding our collaboration with West Pharmaceuticals, a leader in drug packaging, to accelerate adoption. Now these are just a few examples of innovations and new product sets that you can expect to see in the near term.

我們正在擴大與藥物包裝領域的領導者 West Pharmaceuticals 的合作，以加速採用。現在，這些只是您可以在短期內看到的創新和新產品組合的幾個示例。

Additionally, we're scaling our solar business, which we expect to add hundreds of millions of dollars in annual profits and cash flow, beginning in a couple of years. We expect all of these opportunities to further increase our profits as we create additional revenue streams across our markets.

此外，我們正在擴大太陽能業務，預計幾年後將增加數億美元的年利潤和現金流。我們預計所有這些機會將進一步增加我們的利潤，因為我們在整個市場上創造了額外的收入來源。

Whether it's in automotive, cloud computing, broadband, 5G, solar, pharmaceutical packaging, next-generation displays and cover materials, augmented reality or semiconductors, our role in key secular trends is material and compelling.

無論是在汽車、雲計算、寬帶、5G、太陽能、醫藥包裝、下一代顯示器和覆蓋材料、增強現實還是半導體領域，我們在關鍵長期趨勢中的作用都是重要且引人注目的。

We've built a robust opportunity set that will drive durable long-term growth.

我們已經建立了一個強大的機會集，將推動持久的長期增長。

So before I turn things over to Ed, here's what I'd like to leave you with today. The world is working through some significant aftereffects of the pandemic, and they're not trivial for our company.

因此，在我把事情交給埃德之前，我今天想向您介紹以下內容。世界正在努力應對這一流行病的一些重大後果，這對我們公司來說並非小事。

Our approach in this environment is not the count on conditions in our end markets or our sales improving significantly from the second quarter. And that's why we're guiding based on our current order rates. When we see our orders increase, we will reflect these developments in our operating plans and, of course, our guidance.

在這種環境下，我們的做法並不是指望終端市場的狀況或我們的銷售較第二季度顯著改善。這就是為什麼我們根據當前的訂單率進行指導。當我們看到訂單增加時，我們會將這些發展反映在我們的運營計劃，當然還有我們的指導中。

For now, Corning is executing well on a comprehensive plan to improve profitability and cash flow throughout this low volume period and to emerge stronger. Our efforts are already demonstrating significant results. In the first half of the year, we improved profitability in cash flow despite lower sales.

目前，康寧正在執行一項全面計劃，以提高整個低銷量時期的盈利能力和現金流，並變得更加強大。我們的努力已經取得了顯著的成果。上半年，儘管銷售額下降，但我們的現金流盈利能力有所改善。

Even in a muted sales environment, our pricing and productivity actions will continue to drive improvement in the second half. At the same time, our More Corning approach is driving new product launches that will create additional revenue streams.

即使在銷售環境低迷的情況下，我們的定價和生產力行動也將繼續推動下半年的改善。與此同時，我們的“更多康寧”方法正在推動新產品的推出，從而創造額外的收入來源。

Altogether, as our end markets recover and our volume returns to historic levels, we're positioned to deliver improved profitability and cash flow with significant operating leverage on sales that will grow faster than our markets.

總而言之，隨著我們的終端市場復甦和銷量恢復到歷史水平，我們將能夠通過顯著的銷售運營槓桿來提高盈利能力和現金流，其增長速度將快於我們的市場。

In total, we feel good about our execution. We're taking the right steps to improve our performance today and further improve our results when volume returns. And I look forward to updating you on our progress. Now I'll turn the call over to Ed, so he can get into the details of our results and outlook.

總的來說，我們對我們的執行力感覺良好。我們正在採取正確的措施來提高我們今天的業績，並在銷量恢復時進一步改善我們的業績。我期待著向您通報我們的最新進展。現在我將把電話轉給埃德，以便他詳細了解我們的結果和前景。

All right. Thank you, Wendell. Good morning, everyone. As expected, in the second quarter, we improved profitability and cash flow in an overall weak demand environment. Second quarter sales were $3.5 billion, up 3% sequentially. EPS was $0.45, increasing $0.04 from the prior quarter.

好的。謝謝你，溫德爾。大家，早安。正如預期的那樣，第二季度我們在整體需求疲軟的環境下改善了盈利能力和現金流。第二季度銷售額為 35 億美元，比上一季度增長 3%。 EPS 為 0.45 美元，比上一季度增加 0.04 美元。

Gross margin and operating margin increased sequentially by 100 basis points to 36.2% and 200 basis points to 17.5%, respectively, reflecting progress on our pricing and productivity improvement actions.

毛利率和營業利潤率分別比上一季度增長 100 個基點至 36.2% 和 200 個基點至 17.5%，反映出我們在定價和生產力改進行動方面取得的進展。

These results demonstrate the progress on and benefits from our comprehensive approach to improve profitability and cash flow, including continued actions to offset inflationary costs, return productivity levels to -- return productivity ratios to historical levels and reduce inventory.

這些結果表明，我們在提高盈利能力和現金流的綜合方法方面取得了進展並從中受益，包括繼續採取行動抵消通脹成本、使生產率水平恢復到歷史水平並減少庫存。

Now let's turn to our segment results. Let me start with Optical Communications. I shared with you back in May that we were not seeing the typical seasonal uptick in our orders. Near-term demand for passive optical network products remains weak. And as the quarter progressed, orders came in at the low end of our expectations. As a result, Sales in the second quarter were $1.66 billion, down 5% sequentially and 19% year-over-year.

現在讓我們看看我們的細分結果。讓我從光通信開始。我早在五月份就曾與您分享過，我們的訂單並未出現典型的季節性增長。無源光網絡產品的近期需求仍然疲軟。隨著本季度的進展，訂單量處於我們預期的低端。因此，第二季度銷售額為 16.6 億美元，環比下降 5%，同比下降 19%。

As I'm sure you're hearing across the industry, carriers and enterprise operators are pushing projects into 2024 due to high inflation and rising interest rates. For now, we are sizing our operational plans based on the orders in our books.

我相信您在整個行業中都聽說過，由於高通脹和利率上升，運營商和企業運營商正在將項目推遲到 2024 年。目前，我們正在根據賬簿中的訂單調整運營計劃。

Net income was $140 million, down 12% sequentially and 23% year-over-year. The decline on lower volume was moderated by productivity improvements, as I shared in the first quarter. We raised price in this segment to more appropriately share inflationary costs with customers.

淨利潤為 1.4 億美元，環比下降 12%，同比下降 23%。正如我在第一季度分享的那樣，生產率的提高緩解了產量下降的趨勢。我們提高了該細分市場的價格，以更適當地與客戶分擔通脹成本。

While the demand for passive optical network products remains weak, longer term, we remain confident that the industry's underlying growth drivers are intact. We're pursuing 4 significant secular trends: broadband, 5G, the cloud and the paradigm shift in computation necessary to train large language models and other advanced AI.

儘管對無源光網絡產品的需求依然疲弱，但從長遠來看，我們仍然相信該行業的潛在增長動力完好無損。我們正在追求 4 個重要的長期趨勢：寬帶、5G、雲以及訓練大型語言模型和其他高級人工智能所需的計算範式轉變。

We've got major innovation programs underway for each category. And our connectivity solutions offer economic advantages for a broader range of customers than ever before, and demand for optical networks is strongly supported by trends in computation as well as by private and public infrastructure investments to help connect the unconnected and bring broadband to a much larger share of the population.

我們正在針對每個類別開展重大創新計劃。我們的連接解決方案為比以往更廣泛的客戶提供了經濟優勢，計算趨勢以及私人和公共基礎設施投資有力地支持了對光網絡的需求，以幫助連接未連接的人並將寬帶帶入更大的範圍。人口比例。

Turning to Display Technologies, sales in the second quarter were $928 million, up 22% sequentially and 6% year-over-year. Net income was $208 million, up 30% sequentially, primarily driven by higher volume. Second quarter panel maker utilization played out in line with the expectations I described 3 months ago. After reaching historic lows in 2022 and as recently as January, panel maker utilization has increased consistently, driving significant sequential volume increases. We believe that the display industry recovery is underway.

至於顯示技術，第二季度銷售額為 9.28 億美元，環比增長 22%，同比增長 6%。淨利潤為 2.08 億美元，環比增長 30%，主要是由於銷量增加。第二季度面板製造商的利用率與我三個月前描述的預期一致。在 2022 年和最近的 1 月份達到歷史低點後，面板製造商的利用率持續增加，帶動銷量大幅增長。我們相信顯示器行業正在復蘇。

Now let me update you on what has happened since our display price increase announcement in May. Since then, we've engaged with our customers, and they understand our need to offset elevated costs. We expect to finalize agreements for double-digit price increases that will begin to go into effect in the third quarter. We expect our profitability to improve and to return to pre-pandemic levels as we exit the quarter.

現在讓我向您介紹自 5 月份我們宣布顯示器價格上漲以來所發生的最新情況。從那時起，我們開始與客戶合作，他們理解我們需要抵消增加的成本。我們預計將敲定兩位數提價協議，該協議將於第三季度開始生效。我們預計，當我們退出本季度時，我們的盈利能力將會改善並恢復到大流行前的水平。

Moving to Specialty Materials, second quarter sales were down 13% year-over-year. This reflects continued end market softness. Sales increased 4% sequentially on higher Gorilla Glass sales. Net income was $33 million, down 15% sequentially, impacted by continued development costs for new product launches.

至於特種材料，第二季度銷售額同比下降 13%。這反映出終端市場持續疲軟。由於大猩猩玻璃銷量增加，銷售額環比增長 4%。受新產品發布持續開發成本的影響，淨利潤為 3300 萬美元，環比下降 15%。

Looking ahead, we believe that there are new innovation opportunities for us in emerging trends like augmented reality, bendable devices and AI that will extend our More Corning opportunities far into the future.

展望未來，我們相信增強現實、可彎曲設備和人工智能等新興趨勢為我們帶來了新的創新機會，這將使我們在未來獲得更多康寧機會。

For example, our world-leading optical materials and systems in our Advanced Optics business power EUV lithography technology. We enable the manufacturing of smaller, faster, more powerful chips, including GPUs. Global AI initiatives are accelerating demand for GPUs and for our EUV-related products.

例如，我們先進光學業務中世界領先的光學材料和系統為 EUV 光刻技術提供支持。我們能夠製造更小、更快、更強大的芯片，包括 GPU。全球人工智能計劃正在加速對 GPU 和 EUV 相關產品的需求。

In Environmental Technologies, second quarter sales were $457 million, up 6% sequentially and 28% year-over-year. Net income increased to $107 million on stronger sales and improved productivity. In automotive, our sales were up 8% sequentially, driven by the ramp of GPF sales in China, based on regulations that are now in effect. We do not expect to see this level of GPF sales in China in the third quarter.

在環境技術領域，第二季度銷售額為 4.57 億美元，環比增長 6%，同比增長 28%。由於銷售強勁和生產力提高，淨利潤增至 1.07 億美元。在汽車領域，根據現已生效的法規，受中國 GPF 銷量增長的推動，我們的銷售額環比增長了 8%。我們預計第三季度中國的 GPF 銷量不會達到這一水平。

Auto production levels remained steady quarter-over-quarter in North America and Europe. Year-over-year, our automotive sales were up 40%, driven by the GPF ramp in China that I just mentioned and versus low auto sales in China during the 2022 COVID shutdowns and 2022 supply chain issues for automakers globally. In diesel, our sales were up [13%] year-over-year, driven by heavy-duty demand in North America and Europe, which more than offset languishing demand in China.

北美和歐洲的汽車產量環比保持穩定。受我剛才提到的中國 GPF 增長的推動，以及 2022 年新冠疫情停工和 2022 年全球汽車製造商供應鏈問題期間中國汽車銷量較低的推動，我們的汽車銷量同比增長了 40%。在柴油方面，受北美和歐洲重型需求的推動，我們的銷量同比增長 [13%]，這足以抵消中國疲軟的需求。

Turning to Life Sciences, second quarter sales were $231 million, down 10% sequentially and 26% year-over-year. Both the sequential and year-over-year sales declines resulted from lower demand for COVID-related products in China and by customers continuing to draw down inventory.

生命科學領域，第二季度銷售額為 2.31 億美元，環比下降 10%，同比下降 26%。銷售額環比和同比下降都是由於中國對新冠病毒相關產品的需求下降以及客戶持續減少庫存所致。

Net income increased sequentially to $11 million, with productivity improvements more than offsetting lower sales. We expect our sales and profitability to improve as the industry corrects and as we continue to restore productivity ratios back to pre-pandemic levels.

淨利潤連續增加至 1100 萬美元，生產率的提高足以抵消銷售額的下降。我們預計，隨著行業的調整以及我們繼續將生產率恢復到大流行前的水平，我們的銷售額和盈利能力將會改善。

Finally, in Hemlock and Emerging Growth businesses, Sales in the second quarter were $377 million, consistent with the first quarter. Sales were down 10% year-over-year, partly associated with a decline in solar-grade polysilicon spot prices.

最後，在 Hemlock 和新興增長業務中，第二季度銷售額為 3.77 億美元，與第一季度持平。銷售額同比下降 10%，部分原因是太陽能級多晶矽現貨價格下跌。

We are seeing continued strong demand for solar-grade polysilicon required to meet the need for a transparent, sustainable and traceable solar supply chain in the U.S. market. And we have long-term take-or-pay contracts with our customers that have floor price mechanisms built in to help mitigate the impacts of spot market dynamics. Net income increased sequentially to $26 million, up 4% year-over-year, driven by productivity improvements.

我們看到對太陽能級多晶矽的需求持續強勁，以滿足美國市場對透明、可持續和可追溯的太陽能供應鏈的需求。我們與客戶簽訂了長期的照付不議合同，其中內置了底價機制，以幫助減輕現貨市場動態的影響。在生產力提高的推動下，淨利潤環比增至 2600 萬美元，同比增長 4%。

Now let me spend a minute on our outlook for the third quarter. As we've been sharing with you, we are planning our operations based on our current order run rate. And we're continuing to take pricing and productivity actions to improve profitability and cash flow. We're adopting the same philosophy for our guidance. Based on our current order run rate, we expect our sales to come in roughly in line with quarter 2, approximately $3.5 billion. Orders begin to increase, we'll let you know.

現在讓我花一點時間談談我們對第三季度的展望。正如我們一直與您分享的那樣，我們正在根據當前的訂單運行率來規劃我們的運營。我們將繼續採取定價和生產力行動，以提高盈利能力和現金流。我們採用相同的指導理念。根據我們目前的訂單運行率，我們預計銷售額將與第二季度大致持平，約為 35 億美元。訂單開始增加，我們會通知您。

On roughly flat total company sales, we expect improved profitability and cash flow. We expect EPS to come in about the same or slightly better than the second quarter, and this factors in sequentially higher interest expense and a slightly higher tax rate.

在公司總銷售額基本持平的情況下，我們預計盈利能力和現金流將有所改善。我們預計每股收益將與第二季度大致相同或略好，這會導致利息支出連續上升和稅率略高。

Of course, there are differing dynamics in each of our businesses. At a high level, we expect improvements in Display and Specialty Materials to be offset by declines in Optical Communications, driven by the dynamics I previously mentioned, as well as declines in Environmental, where we expect lower sales for GPF in China as the ramp is largely complete, and we expect lower demand for heavy duty. We continue to expect 2023 full-year capital expenditures to be slightly lower than 2022.

當然，我們每項業務都有不同的動態。在高水平上，我們預計顯示和特種材料的改善將被光通信的下降所抵消，這是由我之前提到的動態推動的，以及環境的下降，我們預計中國 GPF 的銷售額將下降，因為增長是基本完成，我們預計重型卡車的需求將會下降。我們繼續預計 2023 年全年資本支出將略低於 2022 年。

Now I'd like to wrap up with a few key takeaways. As CFO, I am pleased with our execution on many dimensions. Our second quarter results demonstrate the benefits of our comprehensive approach to address aftereffects of the pandemic. We're sharing inflationary costs with our customers. We're returning our productivity ratios to pre-pandemic levels, and we are on track to normalize inventory.

現在我想總結一些要點。作為首席財務官，我對我們在許多方面的執行感到滿意。我們第二季度的業績證明了我們採取綜合方法來解決大流行後遺症的好處。我們正在與客戶分擔通貨膨脹成本。我們正在將生產力比率恢復到大流行前的水平，並且我們有望實現庫存正常化。

Additionally, we're undertaking initiatives to capture our next wave of growth opportunities. In the near term, to enhance shareholder value, we remain focused on improving cash flow and profitability in the second half even at our current sales run rate and advancing innovations to outperform our end markets.

此外，我們正在採取舉措來抓住下一波增長機會。短期內，為了提高股東價值，即使在目前的銷售運行率下，我們仍將重點放在改善下半年的現金流和盈利能力上，並推進創新以超越我們的終端市場。

We're seeing the recovery play out in display, and we expect to see it play out across our other markets because the underlying fundamental drivers remain intact.

我們看到復蘇正在顯現，並且我們預計其他市場也會出現復甦，因為潛在的基本面驅動因素仍然完好無損。

Longer term, we are well positioned to continue capturing growth tied to key secular trends and expect to grow faster than our markets, driven by our More Corning approach. So I look forward to updating you on our progress. Now I'll turn things back over to Ann.

從長遠來看，我們處於有利地位，可以繼續抓住與關鍵長期趨勢相關的增長，並預計在我們的“更多康寧”方法的推動下，增長速度快於我們的市場。因此，我期待著向您通報我們的最新進展。現在我會把事情交還給安。

Thanks, Ed. Operator, we're ready for our first question.

謝謝，艾德。接線員，我們準備好回答第一個問題了。

(Operator Instructions) Our first question comes from the line of Samik Chatterjee with JPMorgan.

（操作員指令）我們的第一個問題來自摩根大通的 Samik Chatterjee。

I guess maybe if I can get your insights and what you're seeing in the market [rated] to optical, which you're guiding down sequentially into the third quarter. Have you seen more incremental weakness, given we've seen certainly telcos pulled back on spending a bit more? Or as you sort of look in -- look at your 3Q guidance, is being driven by both telcos and enterprise.

我想也許如果我能獲得您的見解以及您在光學市場上看到的情況，您將按順序將其引導到第三季度。鑑於我們確實看到電信公司削減了更多支出，您是否看到了更多的增量疲軟？或者，正如您所看到的那樣，看看您的第三季度指導，是由電信公司和企業共同推動的。

And just a quick second part there. I mean, any discovery, discussions in terms of what this lead cable replacement opportunity or whether it's an opportunity as well for Corning in the long run?

這是第二部分。我的意思是，對於這種主要電纜更換機會是什麼，或者從長遠來看這是否也是康寧的一個機會，有任何發現和討論嗎？

Samik, I appreciate the question. So I think we're going to go back to what we said a little bit as we shared our perspective on the second quarter. When we were together in May, I talked mostly about us not seeing an inflection in our order rates, and that was driving how we saw the second quarter playing out. Normally, we would have a pretty big seasonal uptick in the second quarter relative to the first quarter.

Samik，我很欣賞這個問題。因此，我認為我們將回到我們在分享對第二季度的看法時所說的內容。當我們五月份在一起時，我主要談論的是我們沒有看到訂單率的變化，這推動了我們對第二季度的表現。通常情況下，第二季度相對於第一季度會有相當大的季節性上升。

As it turned out, our orders were actually even lower than we thought at that time. And therefore, the second quarter came in down from the first quarter, and we're guiding the third quarter to be down sequentially again, and that's primarily driven by what we're seeing in our order book.

事實證明，我們的訂單實際上比我們當時想像的還要低。因此，第二季度比第一季度有所下降，我們預計第三季度將再次環比下降，這主要是由我們在訂單簿中看到的情況推動的。

I think that's the best way for us to describe the way we see the optical market playing out versus what might happen in the future. For sure, as you hear and see in the industry, we're seeing it in both the carrier and the enterprise space, customers are pushing projects out into 2024.

我認為這是我們描述光學市場的發展方式與未來可能發生的情況的最佳方式。當然，正如您在行業中聽到和看到的那樣，我們在運營商和企業領域都看到，客戶正在將項目推遲到 2024 年。

Any thoughts on the lead cable replacement opportunity, whether you see that as an opportunity?

對於引線電纜更換機會有什麼想法，您是否認為這是一個機會？

We'll do both. I'll add a little to Ed and then talk briefly about the lead cables. So I think the way we think -- the right way to think about how we're approaching demand in our optical market is our historic models that we would normally use to predict future revenue streams from what we're experiencing in one quarter to the -- be able to build out a year plan and our direct customer inputs on their plans for the year haven't have -- proven to not be as reliable as we like.

我們都會做。我將向 Ed 補充一些內容，然後簡要討論一下引線。因此，我認為我們的思考方式 - 思考我們如何滿足光學市場需求的正確方法是我們的歷史模型，我們通常會使用該模型來預測未來的收入流，從我們在一個季度到下一個季度的經歷- 能夠制定年度計劃，而我們的客戶對他們的年度計劃的直接投入還沒有 - 事實證明，這並不像我們希望的那樣可靠。

And so what you're really seeing in our guide is really a shift in our operating philosophy, which is we're going to plan our operations based on what we see in our order book, and we're going to improve our productivity to historic rates based on that broad load, and we're going to increase our prices and carry the appropriate inventory so that our profitability and cash flow is going to increase in a very reliable manner despite the lower sales volume.

因此，您在我們的指南中真正看到的是我們運營理念的轉變，即我們將根據我們在訂單簿中看到的內容來規劃我們的運營，並且我們將提高我們的生產力基於廣泛負載的歷史費率，我們將提高價格並持有適當的庫存，以便我們的盈利能力和現金流將以非常可靠的方式增加，儘管銷量較低。

And so that's all you're really seeing in our guide. We're just carrying our operating philosophy forward to our guide.

這就是您在我們的指南中真正看到的全部內容。我們只是將我們的經營理念作為我們的指南。

As to lead cables, [with] a complicated issue. The good news is, is the glass is entirely inert to the environment and is better, lower cost, all the things that make it the right side of the secular trend would mean that this is why it's an ascendant technology on really every metric you can name. But I have no further insight to offer on the lead cable problem or opportunity.

至於引線，是一個複雜的問題。好消息是，玻璃對環境完全惰性，而且性能更好、成本更低，所有使其符合長期趨勢的因素都意味著，這就是為什麼它在幾乎所有指標上都是一種優勢技術。姓名。但我對引線問題或機遇沒有進一步的見解可提供。

Our next question comes from the line of Meta Marshall with Morgan Stanley.

我們的下一個問題來自梅塔·馬歇爾與摩根士丹利的對話。

Great. You noted that the pricing negotiations, you're already starting to see traction on those. I just wanted to kind of get more detail there. Is this being accompanied by long-term supply agreements? Just how should we think about share in terms of kind of how these pricing increases impact revenue? I realize they're probably all not done, but any additional commentary there would be helpful.

偉大的。您注意到定價談判，您已經開始看到這些談判的吸引力。我只是想了解更多細節。這是否伴隨著長期供應協議？我們應該如何考慮這些定價增加如何影響收入的份額？我意識到它們可能都還沒有完成，但是任何額外的評論都會有幫助。

Thanks for the question, Meta. I think you're right on all the dimensions, right? This price increase is a very significant, a complicated strategy move that is done in a backdrop, as most of businesses are, on well-established long-term agreements. Yet we are redoing the value proposition between ourselves and our customers. So it's complicated.

謝謝你的提問，梅塔。我認為你在所有方面都是正確的，對嗎？這次提價是一項非常重大、複雜的戰略舉措，就像大多數企業一樣，是在建立了完善的長期協議的背景下進行的。然而，我們正在重新制定我們自己和客戶之間的價值主張。所以這很複雜。

So the good news is it's progressing well. Our customers understand our need to offset elevated cost. We expect to successfully execute a double-digit price increase in the third quarter and do so in a manner that does not negatively impact our market share. That's very significant and compelling.

所以好消息是進展順利。我們的客戶了解我們需要抵消增加的成本。我們預計第三季度將成功實現兩位數的提價，並且不會對我們的市場份額產生負面影響。這是非常重要和引人注目的。

Now, this also leaves -- I also understand the challenge in modeling, like specialized strategic move, especially in the backdrop of what's going on in the end markets. So let me just share for a moment the way we think about it.

現在，這也離開了——我也理解建模方面的挑戰，比如專門的戰略舉措，尤其是在終端市場發生的情況下。因此，讓我暫時分享一下我們的想法。

The way we think about the financials is that what we're seeking to do is to return display profitability, sort of think NPAT percent of sales, right, how much net income was the percent of net income on top of our sales revenue, back to the historic levels in the mid- to high 20s. And we've been operating the past year closer to 20%.

我們思考財務的方式是，我們尋求做的是返回顯示盈利能力，有點像銷售額的 NPAT 百分比，對吧，淨收入是多少淨收入占我們銷售收入的百分比，返回達到20多歲的歷史水平。去年我們的運營率接近 20%。

Now we expect to hit that level of profitability as we exit the third quarter. So that's the way we tend to think about the financial modeling. Is that helpful, Meta?

現在，我們預計在第三季度結束時將達到這一盈利水平。這就是我們思考財務模型的方式。這有幫助嗎，梅塔？

Yes, that's helpful. I appreciate it.

是的，這很有幫助。我很感激。

Our next question comes from the line of Asiya Merchant with Citi.

我們的下一個問題來自花旗銀行的 Asiya Merchant 線路。

In terms of returning the business back to sort of pre-pandemic levels, how much confidence that you have that this is something that could possibly maybe happen during '24? Or is it the first part of '24? Is it the end of '23?

就讓業務恢復到大流行前的水平而言，您對這可能在 24 年期間發生的事情有多少信心？或者這是'24的第一部分？ 23年末了嗎？

Do you guys have any more visibility into how we should think about as we exit this year into '23 and into '24, based on discussions with your customers right now? And if you could provide some color by segment, that would be even more helpful.

根據現在與客戶的討論，你們是否對我們今年進入“23”和“24”時應該如何思考有更多的了解？如果您可以按段提供一些顏色，那就更有幫助了。

Can I ask a clarifying question? Are you speaking about display or the broader company? Just so I can make sure I answer can your question specifically.

我可以問一個澄清的問題嗎？您是在談論顯示器還是更廣泛的公司？這樣我就可以確保我能具體回答你的問題。

We could start with display because it seems like optical, there is some weakness. And then Specialty, if you guys can talk about what you see in the back half. But it was more a broader commentary as well about confidence in getting to kind of pre-pandemic levels of profitability as we exit '23 and into '24.

我們可以從顯示開始，因為它看起來像光學的，有一些弱點。然後是專業，如果你們能談談你們在後半段看到了什麼。但這更是一種更廣泛的評論，也是關於當我們退出 23 世紀並進入 24 世紀時，對達到大流行前盈利水平的信心。

Okay. Great. So let me start with display, and then I'll have Ed add some color on the total company. So in display, we expect to return to pre-pandemic levels this year as we exit Q3. And then we would expect that level of profitability, what our plan is, is that we'll continue to carry forward into next year. Is that -- does that address your question on this point? Good. Ed, do you want to speak to the...

好的。偉大的。讓我從展示開始，然後我會讓 Ed 為整個公司添加一些色彩。因此，我們預計，隨著第三季度的結束，今年將恢復到大流行前的水平。然後我們預計我們的盈利水平，也就是我們的計劃，將繼續延續到明年。這是否解決了您在這一點上的問題？好的。艾德，你想和...說話嗎？

Yes, sure. I'll build on Wendell's comments. Thanks, Asiya. So first, I want to sort of start with where we are in Q2. If you think about where our gross margin and operating margin in Q2 are, we've made a significant move up from where we were at the end of the year. Gross margin at 36%, operating margin at about 17.5%. So 260 basis point improvement from the fourth quarter and 300 basis point improvement, I think, on operating margin from the fourth quarter.

是的，當然。我將以溫德爾的評論為基礎。謝謝，阿西婭。首先，我想從第二季度的情況開始。如果你考慮一下我們第二季度的毛利率和營業利潤率，就會發現我們比年底的水平有了顯著的提高。毛利率為36%，營業利潤率約為17.5%。因此，我認為，營業利潤率比第四季度提高了 260 個基點，比第四季度提高了 300 個基點。

So as we've sort of talked about, our goal is to continue to marching up -- to march up profitability-wise. Now our sales are muted, so they're at a lower level, and that obviously impacts overall profitability. Now as we go forward, display, we shared our view, we expect to continue improving overall profitability for Corning, yes, led by display, but also across all of our segments.

正如我們所談到的，我們的目標是繼續前進——在盈利能力方面前進。現在我們的銷售疲軟，因此處於較低水平，這顯然會影響整體盈利能力。現在，隨著我們前進，顯示器，我們分享了我們的觀點，我們期望繼續提高康寧的整體盈利能力，是的，以顯示器為主導，但也包括我們所有的細分市場。

And then when sales return, I think it is possible for us to get back to real pre-pandemic historical levels at some point in the future. So that's kind of the way you think about it. I think of it as a continued march upward, display, very specific, given where we are, and we've seen this volume recovery; and then our pricing and productivity actions will continue to take effect in the third and fourth quarter. Does that help?

然後，當銷售恢復時，我認為我們有可能在未來某個時候回到大流行前的真實歷史水平。這就是你的想法。我認為這是一個持續的上升，顯示，非常具體，考慮到我們所處的位置，我們已經看到了成交量的恢復；然後我們的定價和生產力行動將在第三和第四季度繼續生效。這有幫助嗎？

Yes. And then just in terms of share buyback, at what point -- now that preferred shares, the payments that you had for the purchase from [Samsung], I mean, those were -- hopefully come to an end now. When would you expect to turn on share repurchase?

是的。然後就股票回購而言，在什麼時候 - 現在優先股，你從[三星]購買的付款，我的意思是，這些 - 希望現在結束。您預計什麼時候啟動股票回購？

When we start piling up more and more cash flow every quarter as we are aiming at. So there's improving in our profitability and cash flow even at this muted sales level, we want to see that first before we think deeply about our capital allocation model.

當我們開始按照我們的目標每個季度積累越來越多的現金流時。因此，即使在如此低迷的銷售水平下，我們的盈利能力和現金流也有所改善，我們希望在深入思考我們的資本配置模型之前首先看到這一點。

As always, you can expect us to hold our shareholders near and dear in our heart. But the first step is we've got to restore that profitability and cash flow to our pre-pandemic levels even at these muted sales levels.

與往常一樣，您可以期望我們將股東放在心上。但第一步是，即使在銷售水平低迷的情況下，我們也必須將盈利能力和現金流恢復到大流行前的水平。

Our next question comes from the line of Mehdi Hosseini with SIG.

我們的下一個問題來自 SIG 的 Mehdi Hosseini。

Actually, I have one clarification. Wendell, you talked about the pre-pandemic margin profile for Display business. I'm a little bit confused. You exited 2019 with a 24% net income margin for Display. And in the prior year, it was like 26% to 27%. When you reference pre-pandemic, how far back should we go, given the margin difference in 2018 and 2019?

事實上，我有一個澄清。溫德爾（Wendell），您談到了顯示器業務大流行前的利潤狀況。我有點困惑。 2019 年結束時，展示廣告業務的淨利潤率為 24%。而在前一年，這一比例約為 26% 至 27%。當您提到大流行前時，考慮到 2018 年和 2019 年的利潤率差異，我們應該追溯到多遠之前？

Yes. Mehdi, this is Ed. So I think the way to think about it is we've been running closer to 20%, and we think of pre-pandemic closer to 30%, right? So I think it's a big delta that we seek to achieve, so not the end of 2019 levels, but more like the back half of 2018, maybe the front half of 2019 and maybe even earlier than that, depending on how successful we are.

是的。邁赫迪，這是艾德。所以我認為思考這個問題的方法是我們已經接近 20%，我們認為大流行前接近 30%，對嗎？因此，我認為這是我們尋求實現的一個巨大的增量，所以不是 2019 年底的水平，而是更像 2018 年下半年，也許是 2019 年上半年，甚至可能更早，這取決於我們的成功程度。

Okay. Very helpful. And then you highlighted opportunities with polysilicon. I'm trying to understand how the Hemlock and other emerging growth revenue scale without significant or material increase in CapEx. You did [377] in Q2 and [386] at the prior quarter. And then in the latter part of last year, you were doing higher revenue. Should I assume that you can actually do like closer to 500 million without significant CapEx?

好的。很有幫助。然後您強調了多晶矽的機會。我試圖了解 Hemlock 和其他新興增長收入如何在資本支出沒有顯著或實質性增加的情況下擴大規模。您在第二季度做了 [377]，在上一季度做了 [386]。然後在去年下半年，你的收入增加了。我是否應該假設，在沒有大量資本支出的情況下，您實際上可以做到接近 5 億美元？

Yes. Mehdi, so I'll take that one also. So a couple of things. Just a reminder, in that segment, you have Hemlock, you have our auto glass business and you have our Corning Pharmaceutical Technologies business, think Valor, Velocity. I think all of those businesses will grow their sales. So I definitely think the level you're thinking about is very achievable for us.

是的。邁赫迪，所以我也選那個。有幾件事。只是提醒一下，在這個領域，你有 Hemlock，你有我們的汽車玻璃業務，你有我們的康寧製藥技術業務，想想 Valor 和 Velocity。我認為所有這些企業的銷售額都會增長。所以我絕對認為您所考慮的水平對我們來說是非常可以實現的。

In Hemlock, we're currently working through additional capacity, so that we can expand that business. There will be some capital spending, but I don't think you need to think of it as significant at this point.

在 Hemlock，我們目前正在擴大產能，以便擴大業務。將會有一些資本支出，但我認為您目前不需要認為它很重要。

I think when we're not quite ready yet to discuss sort of the precise way in which we expect to expand our profit streams in solar. So what we're trying to do is to provide you some insight as to how much more income we expect in that segment and a rough idea of the timing of that without yet fully disclosing the details of our plan, to be able to realize that expanded value footprint.

我認為當我們還沒有準備好討論我們期望擴大太陽能利潤流的精確方式時。因此，我們正在努力做的是，在尚未完全披露我們計劃細節的情況下，向您提供一些有關我們預計該細分市場將增加多少收入的見解，以及大致的時間安排，以便能夠認識到這一點擴大價值足跡。

So we will be more forthcoming as -- this finalizes that it is in our benefit to come out of the more stealthy mode that we are in. But at the same time, it is significant enough. Do we wanted to make sure that we had provided for you a rought idea on how to think about it financially? So that's -- what I think you have a good question here. But -- so we're trying to -- we've given you the answer without all the inputs. Does that make sense?

因此，我們將更加坦誠地表明——這最終表明，擺脫我們所處的更加隱秘的模式對我們有利。但與此同時，它也足夠重要。我們是否想確保我們為您提供瞭如何從財務角度考慮的粗略想法？所以這就是——我認為你在這裡提出了一個很好的問題。但是——所以我們正在努力——我們已經在沒有所有輸入的情況下給了你答案。那有意義嗎？

Absolutely. And the reason I ask is your margin -- net margin profile for this business unit has continued to improve. And I attribute that to poly. So would it be fair to say that poly is a much better margin profile than other subsegments within that business unit?

絕對地。我問的原因是您的利潤率——該業務部門的淨利潤狀況持續改善。我將其歸因於保利。那麼，可以公平地說，保利的利潤狀況比該業務部門內的其他細分市場要好得多嗎？

I think that there's a lot going on in that segment. And you are right to think that a significant amount of the growth, which we have outlined here, and we've given in our sort of longer term what happens in a couple of years, is rolling out of our fundamental capabilities in solar because I think you're right to think about it that way.

我認為該領域發生了很多事情。你的想法是正確的，我們在這裡概述的增長量，以及我們從長遠來看幾年內發生的情況，正在超出我們在太陽能方面的基本能力，因為我我認為你這樣想是對的。

I think concluding much more than that from the statement sort of runs the risk of you not being exactly in line with what our strategic plan is. So I'd ask for a little bit of patience, and it will be forthcoming in the not-too-distant future.

我認為從聲明中得出的結論可能會存在與我們的戰略計劃不完全一致的風險。所以我希望大家有一點耐心，這將在不久的將來實現。

Our next question comes from the line of Wamsi Mohan with Bank of America.

我們的下一個問題來自瓦姆西·莫漢 (Wamsi Mohan) 與美國銀行的聯繫。

When I look at Display, revenue in the quarter was up 6% year-on-year, but profitability is down 9% year-on-year. You're obviously calling for an inflection in Display and expecting significant profit improvement, as you just answered in prior questions. So I was wondering, how much of your cost actions benefit did you already realized in the second quarter?

當我查看顯示業務時，該季度的收入同比增長了 6%，但盈利能力同比下降了 9%。正如您在之前的問題中所回答的那樣，您顯然正在呼籲展示廣告的轉變並期望顯著的利潤改善。所以我想知道，您在第二季度已經實現了多少成本行動收益？

And as you think about the margin improvement, how much of that would you say is going to come from pricing actions versus continued benefit from productivity initiatives that you're undertaking? That's the first part of the question.

當您考慮利潤率的提高時，您認為其中有多少是來自定價行為，而不是來自您正在採取的生產力計劃的持續收益？這是問題的第一部分。

And the second part of it is, as you think about the improvement in Display, would you say that this pricing sort of supersedes any of the prior market-based pricing agreements that you had with some of your customers? Is this a new paradigm? Or is that like old paradigm still impact?

第二部分是，當您考慮顯示方面的改進時，您是否會說這種定價會取代您與某些客戶之前達成的任何基於市場的定價協議？這是一個新的範式嗎？或者說舊的範式仍然有影響嗎？

Yes, I'll take the first part of your question first, Wamsi. So the main reason we are taking a price action is the point you're making. We are absorbing higher costs. We have elevated costs in this business, and we expect the price to offset those costs. And I think about that as being the most significant driver of our profitability improvement as we go forward.

是的，我首先回答你問題的第一部分，Wamsi。因此，我們採取價格行動的主要原因是您所提出的觀點。我們正在吸收更高的成本。我們在這項業務中的成本較高，我們預計價格可以抵消這些成本。我認為這是我們前進過程中盈利能力提高的最重要驅動力。

I agree with that. I mean the right way to think about it, Wamsi, is if you take a look at our quarter 2 results, and it's a great example of why we need to increase our prices, right? So then, there is -- this is a paradigm, a new paradigm move. This is a significant enough, Wamsi, that it's going to take a little time to settle into what this does to the overall dynamic in the industry. So this type of significant move does represent a new paradigm for us.

我同意這一點。我的意思是，Wamsi，正確的思考方式是，看看我們第二季度的業績，這是我們為什麼需要提高價格的一個很好的例子，對吧？那麼，這是一個範式，一個新的範式舉措。 Wamsi，這已經足夠重要了，需要一些時間來了解這對行業整體動態的影響。所以這種重大舉措確實為我們代表了一個新的範式。

It is still going to be based on our same fundamental principles that unlike many of the other players of our competitors in this industry, we are the most reliable supplier. We are going to be able to continue to maintain our position in this business and be the technology leader.

它仍然基於我們相同的基本原則，即與該行業競爭對手的許多其他參與者不同，我們是最可靠的供應商。我們將能夠繼續保持我們在該行業的地位並成為技術領導者。

If you follow the space closely, you'll see significant announcements in the glass industry here, actually capacity being taken out of the system because of the profitability challenges in glass.

如果您密切關注該領域，您會在這裡看到玻璃行業的重大公告，實際上，由於玻璃的盈利挑戰，產能正在從系統中剔除。

So the core reason that we are the leader in this business is our reliability, the advantages inherent in our technology to play itself out in both cost advantage and product leadership. And those will still underpin the new paradigm, but it is a new pricing paradigm,.

因此，我們成為該行業領導者的核心原因是我們的可靠性，即我們技術固有的優勢，可以在成本優勢和產品領先地位方面發揮作用。這些仍然將支撐新的範式，但這是一個新的定價範式。

So whether if I could just follow up on that, in the past, you guys obviously went through a period where price decline was in the mid-teens, and that stabilized down to low single digits, given that you guys did something really interesting with locking in market share or volume at some of your largest customers, which created an incentive to not take price down.

因此，我是否可以跟進這一點，在過去，你們顯然經歷了一段價格下降在十幾歲左右的時期，並且穩定下來到低個位數，因為你們做了一些非常有趣的事情鎖定一些最大客戶的市場份額或銷量，這會產生不降低價格的動力。

I understand that we're in a recovery phase in the display market at the moment. But if you think over the next 2, 3 years, why should we not think that the competitive response would go back to the historical ways of maybe trying to gain incremental share through pricing?

據我了解，目前顯示器市場正處於復蘇階段。但如果你想想未來兩三年，我們為什麼不認為競爭反應會回到過去的方式，即試圖通過定價來獲得增量份額？

Well, let me get through this [quarter] in a reset of double-digit increase in our prices while we maintain our share and keep in place our long-term agreements, right? And after we get done executing this, I'd love to sit down with you, and let's talk it through and maybe bring in some of our display leaders, and we'll talk it through. But right now, what we're focused on is getting this strategic move completed. Does that make sense, Wamsi?

好吧，讓我在維持我們的份額並維持我們的長期協議的同時，以兩位數的價格上漲來度過這個[季度]，對吧？在我們完成執行此操作後，我很樂意與您坐下來，讓我們討論一下，也許可以引入一些展示領導者，我們將討論一下。但現在，我們的重點是完成這一戰略舉措。這有道理嗎，瓦姆西？

Yes, it does. I appreciate the response.

是的，它確實。我很欣賞你的回應。

Our next question comes from the line of Shannon Cross with Credit Suisse.

我們的下一個問題來自瑞士信貸銀行的香農·克羅斯 (Shannon Cross)。

I have two. The first, just sort of a follow-up on pricing, but looking at optical. I'm just wondering what the carriers are seeing, given weakness in demand in relation to some of the pricing that you were putting in place earlier? Is it holding in? Or is there any softness there?

我有兩個。第一個，只是定價的後續行動，但著眼於光學。我只是想知道，考慮到與您之前製定的一些定價相關的需求疲軟，運營商會看到什麼？堅持住了嗎？或者說有什麼柔軟的地方嗎？

And then Wendell, can you just give us an update on how you're thinking about the timing and rollout of government stimulus, both some of the broadband as well as benefit on the poly side from the IRA?

然後，Wendell，您能否向我們介紹一下您對政府刺激​​措施的時機和推出的最新看法，包括一些寬帶以及愛爾蘭共和軍 (IRA) 帶來的多利方面的好處？

Our pricing continues to hold in optical. As far as the timing, IRA, and that is happening, right, as we speak. And I think it's a little early, though there's plenty of news, and there's been awards out to the states. And you're beginning to see the first of them get close on [BEAD]. I think it's a little early for us to be able to call here's when it's happening or do you expect to start to see that in our demand next year.

我們的光學定價繼續保持不變。就時間而言，愛爾蘭共和軍（IRA）正在發生，就在我們說話的時候。我認為現在有點早，儘管有很多消息，而且各州也都獲得了獎項。你開始看到他們中的第一個接近[BEAD]。我認為我們現在就能夠確定它何時發生還為時過早，或者您是否期望明年開始在我們的需求中看到這一點。

Do you think it's -- I mean, do you see it delayed or just progressing along what you had expected?

你認為它是——我的意思是，你認為它是延遲了還是只是按照你的預期進展？

We started with a pretty cynical view, right, of how long it would take. So we may not be the right people to ask. But we expect them really not to start feeling it until next year, and that really hasn't changed. Once again, this is a very large program. It's got a flow from the federal government out to the states, and they have to do awards that our various customers are competing for right?

我們一開始對這需要多長時間抱有相當憤世嫉俗的看法，對吧。所以我們可能不是提出這個問題的合適人選。但我們預計他們要到明年才會開始感受到這一點，而且這一點確實沒有改變。再次強調，這是一個非常大的程序。它有從聯邦政府流向各州的資金，他們必須頒發我們的各種客戶正在爭奪的獎項，對嗎？

And then those customers have to put orders in. And so we've always thought that it wouldn't start to make a big impact into -- got into next year. I believe that is still our belief. I will double check, Shannon, and Ann and Ed will get back to you if I'm wrong, okay?

然後這些客戶必須下訂單。所以我們一直認為它不會對明年產生重大影響。我相信這仍然是我們的信念。我會仔細檢查，香農，如果我錯了，安和埃德會回复你，好嗎？

Our next question comes from the line of Matt Niknam with Deutsche Bank.

我們的下一個問題來自德意志銀行的馬特·尼克南 (Matt Niknam)。

Just one follow-up on optical, and I have one on cash flow as well. On the optical side, are we at a point now where higher rates and macro dynamics are more of a -- driving more of a sustained lull in spend relative to the sort of inventory digestion that was being messaged a couple of quarters back?

只是關於光學的一項後續行動，我還有一份關於現金流的後續行動。從光學角度來看，我們現在是否處於這樣一個階段：相對於幾個季度前所傳達的庫存消化信息，更高的利率和宏觀動態更多地推動了支出的持續平靜？

And then just on cash flow, so I think you're slightly negative for the first half of the year. Obviously, there's some gross margin tailwind from the display price hikes. So maybe, Ed, if you can help us frame expectations for the second half of the year and how meaningful the quarterly improvements can be relative to the $300 million you posted this quarter.

然後就現金流而言，所以我認為今年上半年的情況略有負面。顯然，顯示器價格上漲對毛利率有一定的推動作用。 Ed，如果您能幫助我們制定下半年的預期，以及相對於您本季度發布的 3 億美元而言，季度改進有何意義。

So I'll take the first one. Maybe, Ed, you take the second. So yes, that was really broadly reported throughout all the different people who serve into the telecom space that there was inventory buildup at the various customers. As you'll recall, sort of our feedback for that is yes, we're seeing that, too. But I think it's a more complicated question than just working our way through what sort of just-in-case inventory build is at our telecom customers and that moved to just-in-time like normal, certainly part of it.

所以我會選擇第一個。艾德，也許你選擇第二個。所以，是的，電信領域的所有不同人員都廣泛報導稱，各個客戶的庫存都在增加。您可能還記得，我們​​對此的反饋是肯定的，我們也看到了這一點。但我認為這是一個更複雜的問題，不僅僅是我們的電信客戶建立什麼樣的以防萬一庫存，以及像往常一樣轉向準時制庫存，這當然是其中的一部分。

But where we don't feel, at this point in time, confident enough in our forecasting models for telecom to say, yes, we see that consumption of the inventory, it's behind us, and then we're going to start to see that recovery and a return to sort of our normal seasonality and a recovery in the back half.

但是，目前我們對電信預測模型還沒有足夠的信心說，是的，我們看到庫存的消耗，它已經過去了，然後我們將開始看到這一點復甦並恢復到正常的季節性以及後半段的複蘇。

So we just think it's -- there's more going on here. The fundamental drivers are in place in Opto, but the exact timing on when it pops back, I think it's difficult to call that.

所以我們只是認為——這裡發生了更多事情。 Opto 中的基本驅動因素已經就位，但我認為很難確定它何時恢復的確切時間。

And that's why we're not planning on it and why we're just taking a look at what's in our order book right now and why you heard Ed guide you sequentially down in [Opto], despite the fact this would normally be an up quarter, if everything was sort of operating in a normal cycle. So that's the way we tend to think about that part, Matt. You want to turn to cash flow, Ed?

這就是為什麼我們沒有計劃它，為什麼我們只是看看我們現在的訂單簿中的內容，以及為什麼你聽到 Ed 引導你在 [Opto] 中按順序向下，儘管事實上這通常是向上的如果一切都按正常週期運行的話。這就是我們思考這部分的方式，馬特。你想轉向現金流嗎，艾德？

Yes, sure. Thanks, Matt. So I would say on cash flow, a couple of things. Our goal is to improve our operating cash flow with the actions we're taking. We made a significant move from Q1 to Q2, as you articulated. And I think we have room to continue to increase operating cash flow in the back half relative to what we did in the second quarter. And on capital, we've spent a good bit in the first half. We expect our full year to be slightly down from last year.

是的，當然。謝謝，馬特。所以我想就現金流說幾件事。我們的目標是通過我們正在採取的行動來改善我們的運營現金流。正如您所說，我們從第一季度到第二季度取得了重大進展。我認為，相對於第二季度的情況，我們下半年的運營現金流還有繼續增加的空間。在資本方面，我們上半年花了很多錢。我們預計全年業績將比去年略有下降。

So I think you should also see a slight decline half-over-half on capital spending. So I think the combination of improving operating cash flow and slightly less capital spending should mean the back half is stronger than what you saw in the second quarter. So I definitely think there's room, a meaningful room, for improvement in the back half.

因此，我認為您還應該看到資本支出略有下降。因此，我認為運營現金流的改善和資本支出略有減少的結合應該意味著後半段的情況比第二季度要強。所以我絕對認為後半場還有改進​​的空間，一個有意義的空間。

Just anything to note on working cap in the second half of the year at all?

關於下半年的工作上限有什麼需要注意的嗎？

No. I mean, the thing I think that's most notable for us, and we've talked about it over the last several quarters, is we built a significant amount of inventory during the supply chain disruption period. And our goal is to work that down. I think the good news is we've made a little bit of progress in the first half on lower sales, which is hard to do. So I think that's good. And we're going to continue to keep chipping away at that. So that should help us as well.

不，我的意思是，我認為對我們來說最值得注意的事情是我們在供應鏈中斷期間建立了大量庫存，並且我們在過去幾個季度中一直在討論這一點。我們的目標是解決這個問題。我認為好消息是我們在上半年在銷售額下降方面取得了一些進展，這是很難做到的。所以我認為這很好。我們將繼續努力解決這個問題。所以這也應該對我們有幫助。

Our next question comes from the line of Steven Fox with Fox Advisors, LLC.

我們的下一個問題來自 Fox Advisors, LLC 的 Steven Fox。

Sorry, another question on just the display price increases. So you're seeing volume increases into the second half of the year. So can you isolate the margin accretion just from increasing display prices for '23 and '24? And how successful what you said original bogey you put out in the press release of 20%? And then just one last housekeeping thing, can you just describe what prices did in the Q2?

抱歉，還有一個關於顯示屏價格上漲的問題。所以你會看到下半年銷量有所增加。那麼，您能否將利潤增加與 23 年和 24 年展示價格的上漲分開？你在20%的新聞稿中提出的最初的忌諱有多成功？最後還有最後一件事，您能描述一下第二季度的價格走勢嗎？

Yes. So Steve, I just want to make sure I understand, can you repeat the first part of your question again? I wasn't 100% sure I followed it.

是的。史蒂夫，我只是想確保我理解，你能再重複一下你問題的第一部分嗎？我不能百分百確定我遵循了它。

Yes. So you're saying display margins are going to go up, but volumes are also going up into the second half of the year, I assume it seems like that's what you're also signaling. So if we just think about the price increases, what is that impact on the margin improvement?

是的。所以你說顯示器利潤率將會上升，但下半年銷量也會上升，我想這似乎也是你所發出的信號。那麼，如果我們只考慮價格上漲，這對利潤率改善有何影響？

Got it. Yes. I think I'm not sure we're necessarily signaling volume increase from the second quarter relative for the back half. Certainly, the first quarter was lower, given panel maker utilization levels at really low levels in January.

知道了。是的。我想我不確定我們是否一定會發出第二季度相對於後半段的交易量增加的信號。當然，鑑於 1 月份面板製造商的利用率水平非常低，第一季度的水平較低。

But when I think about the margin, the net income margin improvement in the second half relative to, say, second quarter, pricing is really the predominant driver that we see taking us there. And remember, it's offsetting costs that we're absorbing in our income statement.

但當我考慮利潤率時，下半年淨利潤率相對於第二季度的改善，定價確實是我們看到的主要驅動力。請記住，它抵消了我們在損益表中吸收的成本。

And in terms of how successful pricing was and versus what Q2 pricing was?

定價的成功程度以及與第二季度的定價相比如何？

Well, what we've said here is that we expect, say, versus Q2 -- I'm sorry, Steve, do that again, how successful pricing is?

好吧，我們在這裡所說的是我們的預期，比如說，與第二季度相比——對不起，史蒂夫，再做一次，定價有多成功？

Yes.

是的。

So we expect a double digit -- to close on a double-digit price increase.

因此，我們預計收盤價將出現兩位數的漲幅。

Right. But originally, you said 20% price increases. So I'm just trying to gauge whether you got the full 20, part of it? I mean you could have gotten 10.

正確的。但原來你說漲價20%。所以我只是想看看你是否得到了完整的 20 個，或者其中的一部分？我的意思是你本來可以得到10個。

So our guide today is our guide today, Steve. It's a double-digit price increase. And when we get to the end of the third quarter, I think it will be a little more evident where in double digit that ended up being.

所以我們今天的導遊就是我們今天的導遊，史蒂夫。這是兩位數的價格上漲。當我們到第三季度末時，我認為最終的兩位數數字會更加明顯。

Okay. And sorry to drag this out, but what was Q2 pricing like?

好的。抱歉拖拖拉拉，第二季度的定價是怎樣的？

Relatively consistent with Q1.

與Q1比較一致。

Thank you. Our next question comes from the line of Josh Spector with UBS.

謝謝。我們的下一個問題來自瑞銀集團的喬什·斯佩克特 (Josh Spector)。

I was just wondering if you could expand at some of your comments around data centers and AI and kind of what that means for Corning and if possible, kind of quantify where things are today. So you've talked about more efficiency in some products. You talked about more data transfer within AI versus other data centers. So is there a content opportunity you could scale? And again, what's the base that we should be thinking of that on today?

我只是想知道您是否可以擴展一下有關數據中心和人工智能的一些評論，以及這對康寧意味著什麼，如果可能的話，可以量化一下今天的情況。您談到了某些產品的更高效率。您談到了與其他數據中心相比，人工智能內部的數據傳輸更多。那麼有沒有可以擴展的內容機會呢？再說一次，我們今天應該考慮這個問題的基礎是什麼？

The easiest way to think about this is that we'd expect our hyperscale revenue opportunity fundamentally to more than double for the same number of hyperscale data centers. And that is because of a combination of the amount of interconnects required to do the AI ML compute. It needs more glass within that data center.

考慮這個問題的最簡單方法是，我們預計對於相同數量的超大規模數據中心，我們的超大規模收入機會將從根本上增加一倍以上。這是因為進行 AI ML 計算所需的互連數量的組合。該數據中心需要更多的玻璃。

A lot more of it is happening within the data center, a lot of connections within the data center that are going out just because of the way those large language models are trained, and then you do influence beyond, with our new set of innovations adding to our content. And so that's the way we tend to think about it, how much more than doubling remains to be seen on how successful.

更多的事情發生在數據中心內，數據中心內的許多連接正在消失，只是因為那些大型語言模型的訓練方式，然後你確實會影響到其他地方，隨著我們新的一系列創新的增加到我們的內容。這就是我們傾向於思考的方式，翻倍到底有多成功還有待觀察。

Our innovations continue to be -- and what ends up being sort of the final architectures as we work through a variety of different wiring diagrams here to be able to deliver this new compute package.

我們的創新仍在繼續，當我們通過各種不同的接線圖來交付這個新的計算包時，最終的架構將會是這樣的。

The way to think about your hyperscale revenues, what you're recognizing today?

如何看待您的超大規模收入，您今天認識到了什麼？

So what we'll do is that's in our enterprise segment, right, let us reflect a little, given the size and scale of these changes, and think through what is the right way to be helpful to you to think about how that embeds in that piece of optical, and how sizable is it? That's a good question, Josh. Let us reflect on that, and Ed will get back to you.

因此，我們要做的是在我們的企業領域，對吧，讓我們反思一下，考慮到這些變化的規模和規模，並思考什麼是正確的方式來幫助您思考如何將其嵌入到那塊光學器件有多大？這是個好問題，喬什。讓我們思考一下，Ed 會回复您。

Thank you, we'll take one more question. Operator, please?

謝謝，我們再回答一個問題。接線員，請說？

Our last question comes from the line of George Notter with Jefferies.

我們的最後一個問題來自喬治·諾特和杰弗里斯的對話。

I guess I had another question on the Optical business. I'm just curious, if you guys are enforcing delivery dates with customers or allowing folks to reschedule further out into the future?

我想我還有一個關於光學業務的問題。我只是好奇，你們是否正在與客戶強制執行交貨日期，或者允許人們重新安排到更遠的未來？

And then also, I'm just curious if you're seeing any incremental competition in fiber. And I'm thinking more specifically about gray market fiber, people looking at selling excess inventory in the open market that would now compete with you, any sense for that?

另外，我很好奇您是否看到光纖領域的競爭加劇。我更具體地考慮灰色市場纖維，人們希望在公開市場上出售多餘的庫存，這些庫存現在將與您競爭，這有什麼意義嗎？

Yes. So George, I just want to repeat back your question. You're asking if we're seeing customers ask to push their delivery dates out into the future, is that the question?

是的。喬治，我只想重複你的問題。您問我們是否看到客戶要求將交貨日期推遲，這是問題嗎？

Correct.

正確的。

Well, that happens daily, one way to pull ahead to, I don't really need it then, I need it now because they're executing pretty complicated civil works projects. We're not seeing beyond what we've already guided in our sort of order rates, sort of a new risk. The way maybe which you're getting at is that normally, we're working with our customers on what they're going to take like the entire next year because it's such an important part of what they do, and we have to plan it.

好吧，這種情況每天都會發生，這是一種提前的方式，當時我真的不需要它，我現在需要它，因為他們正在執行相當複雜的土木工程項目。我們沒有看到超出我們已經指導的訂單率的情況，這是一種新的風險。您所理解的方式可能是，通常情況下，我們會與客戶一起討論他們明年一整年要採取的措施，因為這是他們工作的重要組成部分，我們必須對其進行計劃。

And there certainly has been strong variation between what they told us last year, right, and what they're taking this year. So I think that's more of a play than to look through what is the fundamental heartbeat here rather than shifting delivery dates within any given quarter. It does happen, and it is what is behind sort of our operating shift to just plan based on what we're seeing in our order book as opposed to what our customers are telling us for the year or as what our own stochastic models are telling us.

他們去年告訴我們的內容和今年的內容之間肯定存在很大差異。因此，我認為這更像是一種遊戲，而不是了解這裡的基本心跳，而不是在任何給定季度內改變交付日期。它確實發生了，這就是我們的運營轉變背後的原因，即我們只根據我們在訂單簿中看到的內容進行計劃，而不是根據我們的客戶告訴我們的年度信息或我們自己的隨機模型所告訴的內容我們。

As to gray fiber optic cable, we're not seeing that be any sort of significant play here, and it'd be unusual. Are you hearing something? Because if you're hearing something, I will check back with the optical folks, but it would be the first I'd be hearing about that if it's any sort of significant number.

至於灰色光纖電纜，我們在這裡沒有看到任何重要的作用，而且這是不尋常的。你聽到什麼了嗎？因為如果你聽到什麼消息，我會與光學人員核實，但如果它是任何重要的數字，這將是我第一次聽到這個消息。

Got it. Great. Okay. I appreciate it, guys.

知道了。偉大的。好的。我很感激，伙計們。

Thanks, George, and thank you, everybody, for joining us today. Before we close, I want to let you know that we will attend Citi's 2023 Global Technology Conference on September 7, and we'll be hosting management visits to investor offices in select cities. Finally, a web replay of today's call will be available on our site, starting later this morning. Once again, thank you all for joining us. And operator, you can disconnect all lines.

謝謝喬治，也謝謝大家今天加入我們。在結束之前，我想告訴您，我們將參加 9 月 7 日舉行的花旗 2023 年全球技術會議，並將在選定城市舉辦管理層對投資者辦公室的訪問。最後，今天上午晚些時候開始，我們的網站將提供今天電話會議的網絡重播。再次感謝大家加入我們。操作員可以斷開所有線路。

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.

謝謝。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。