NEW YORK (Reuters) - Specialty glass maker Corning Inc (GLW.N) reported second-quarter revenue that missed Wall Street expectations on weak sales volumes in its display and telecommunications business as customers worried about the global economy.
Chief Financial Officer Jim Flaws forecast moderate declines in glass prices in the third quarter. But second-quarter shipments were lower than expected to manufacturers of LCD screens used in product such as flat screen televisions, Corning’s most important market.
“We think they’re taking very little risk at building any inventory” Flaws told Reuters.
Second-quarter revenue dropped to $1.91 billion from $2.01 billion. Analysts expected $2.02 billion, according to Thomson Reuters I/B/E/S.
Flaws said the market for glass displays used in everything from televisions to smartphones would increase sequentially in the low-double-digit percentage range this quarter in line with typical seasonal trends.
He also kept the company’s estimate for full-year growth in television sales in the 3 percent to 5 percent range.
“We expect LCD sales to be okay, up this year every place, except Japan,” Flaws said, noting Japan had unusually high TV sales in 2011. Flaws said cash flow for the year would be “quite strong” without giving details.
If the economic outlook should cause a further decline in demand, Flaws said the company would be ready to cut costs by trimming back employment and manufacturing operations.
Chief Executive Wendell Weeks said in a statement that Corning is concerned about economic weakness in Europe and China as it had “seen signs that the unsettled global economy impacted some of our businesses in the past quarter.”
Along with telecommunications and display, Corning’s environmental technologies segment faced a reduction in sales of light-duty filters for auto emission systems in the quarter.
Flaws said Corning’s telecommunications business grew 10 percent sequentially in the second quarter, compared with the company’s hope for 15 percent growth.
Corning’s profit fell to $462 million, or 30 cents per share, from $755 million, or 47 cents per share, in the year-ago quarter.
Corning shares fell to $12.01 in premarket trade after closing at $12.07 on New York Stock Exchange Tuesday.
Reporting By Sinead Carew; editing by Jeffrey Benkoe