Corning Announces First-Quarter Results

Corning Announces First-Quarter Results

April 27, 2007

     -- EPS exceeds guidance
     -- LCD market estimates increased

    CORNING, N.Y., April 27 /Xinhua-PRNewswire/ -- Corning
Incorporated (NYSE: GLW) on April 25th 2007 announced
first-quarter sales of $1.31 billion and net income of $327
million, or $0.20 per share.

    (Logo: http://www.xprn.com/xprn/sa/200612081746.jpg )

    Corning's first-quarter results include special charges
totaling $125 million, or $0.08 per share.  Excluding these
charges, Corning's first-quarter net income would have been
$452 million, or $0.28 per share.  The company's
first-quarter results exceeded its guidance for earnings
per share of $0.24 to $0.27.  These are non-GAAP financial
measures.  These and all non-GAAP financial measures are
reconciled on the company's investor relations Web site and
in attachments to this news release.

    Reflecting on the first-quarter performance, Wendell P.
Weeks, president and chief executive officer, said, "We
are off to an excellent start this year.  We are encouraged
that Display Technologies performed as expected and that
our new pricing strategy appears to be working.  We
continue to see progress in our Telecommunications segment
and momentum is building for our diesel products."

    Corning's first-quarter results included the following
items: a $110 million non-cash, pretax and after-tax charge
primarily reflecting the increase in market value of Corning
common stock to be contributed to settle the asbestos
litigation related to the Pittsburgh Corning Corporation;
and a $15 million pretax and after-tax charge related to
the retirement of long-term debt.

    First-Quarter Operating Results

    Corning's first-quarter sales of $1.31 billion
increased 4 percent over last year's first-quarter sales of
$1.26 billion.  Sales declined 5 percent when compared to
fourth-quarter 2006 sales of $1.37 billion.  Gross margin
of 45 percent for the first quarter was even with the first
quarter of 2006, and was slightly higher than the 44 percent
in the fourth quarter of last year.

    Equity earnings for the first quarter were $216
million, compared to $272 million in the fourth quarter of
2006, which included $28 million of net nonrecurring gains
at Samsung Corning Company, Ltd.  Samsung Corning is
Corning's 50-percent owned equity venture in Korea; which
manufactures glass panels and funnels for cathode ray tubes
for televisions and computer monitors.  First-quarter equity
earnings include $92 million from Dow Corning Corporation, a
10-percent sequential increase, and lower earnings from
Samsung Corning Precision Glass Co., Ltd. (SCP).

    First-quarter sales for Corning's Display Technologies
segment were $524 million, down 4 percent from the first
quarter of 2006, when Corning's sales of $547 million were
impacted by the panel makers' inventory buildup. 
First-quarter sales declined 15 percent from the seasonally
high 2006 fourth-quarter sales of $619 million as volume
declined 12 percent.  Sequential price declines were
consistent with the company's guidance of 1 percent to 2
percent.

    Equity earnings from Samsung Corning Precision were
$113 million in the first quarter, compared to $147 million
in the fourth quarter last year.  Samsung Corning
Precision's results reflect sequential volume declines of 5
percent and price reductions in the upper single digits. 
Samsung Corning Precision is Corning's 50-percent owned
equity venture in Korea, which manufactures liquid crystal
display (LCD) glass substrates.

    First-quarter Telecommunications segment sales were
$439 million, an increase of 11 percent over first-quarter
sales of $397 million last year and 9 percent over
fourth-quarter sales of $404 million.  Corning experienced
higher demand than anticipated in the first quarter across
most of its telecommunications product lines, including
optical fiber, cable and hardware and equipment. 
Separately, Corning announced that it would begin the
partial reopening of its Concord, N.C., optical fiber plant
in response to improvements in market demand.

    The Environmental Technologies segment had sales of
$179 million, a 15-percent increase on both a
year-over-year and sequential basis as both automotive and
diesel product sales increased.

    Weeks noted that diesel sales in the first quarter of
this year increased 65 percent over the same period last
year.  "We are beginning to see the ramp-up of sales
in the diesel products business due to the new U.S. 2007
emissions regulations for heavy-duty engines," Weeks
said, adding that this trend should continue into the
second half of this year.  Last week Corning announced that
it would begin equipping select European-market diesel
passenger cars for Hyundai-Kia Motors with the company's
DuraTrap(R) AT filters.

    Corning's Life Sciences segment had first-quarter sales
of $76 million, a 6-percent increase over $72 million for
the same period a year ago.

    Cash Flow/Liquidity Update

    Corning ended the first quarter with $2.9 billion in
cash and short-term investments, down from $3.2 billion at
the end of the fourth quarter last year.  The company used
$246 million to repay debt during the first quarter,
reducing its overall debt level to $1.5 billion.

    James B. Flaws, vice chairman and chief financial
officer, said that the company was encouraged by Moody's
Investor Services' recent announcement that it is
considering a possible upgrade to Corning's debt ratings,
currently at Baa2 with a stable outlook.  As is normal for
the first quarter, Corning's free cash flow was slightly
negative, "but we expect to achieve our goal of more
than $400 million of positive free cash flow for the
year," Flaws said.  Free cash flow is a non-GAAP
financial measure.

    Second-Quarter Outlook

    Flaws said that the company expects second-quarter
sales to be in the range of $1.40 billion to $1.45 billion
and EPS in the range of $0.30 to $0.33 before special
items.  This EPS estimate is a non-GAAP financial measure
and excludes special items.  The gross margin percentage
for the second quarter is expected to be in the range of 45
percent to 47 percent.  Corning expects that its
second-quarter corporate tax rate will be between 15
percent and 18 percent.

    Corning anticipates that its second-quarter sequential
LCD volume growth will be in the range of 8 percent to 12
percent for its wholly owned business and SCP, both
individually and in the aggregate.  Corning said it is
continuing its new pricing strategy in the second quarter. 
As a result, the company's price decline guidance for its
wholly owned business is unchanged from its first quarter
guidance.  Corning anticipates that SCP's price declines
will be similar to its wholly owned business.

    Flaws said, "We believe that the second-quarter
volume growth will be driven by the consumer electronics
industry's seasonal buildup in anticipation of the
traditionally stronger second half of the year." 
Flaws also noted that Corning is continuing to transition
its customers to its environmentally friendly EAGLE XG(TM)
glass.

    "We now believe that this year's worldwide LCD TV
penetration rate will increase from our original estimate
of 33 percent to 36 percent of the color television market.
 In total, we expect approximately 73 million LCD
televisions to be sold in 2007," Flaws said. 
Corning's previous estimate was 68 million LCD
televisions.

    Flaws said that Corning has also increased its estimate
for worldwide glass volume in 2007.  "The increase in
expected LCD television penetration and average screen size
has prompted us to raise our expectation of LCD glass volume
growth for 2007.  We now expect that total glass volume will
grow in a range of 35 percent to 40 percent over last
year," Flaws said.  The company estimates that the
Taiwan and Japan markets will grow at the upper end of this
range, while Korea will likely grow at a rate lower than the
range.  Corning's previous estimate was market growth in the
"mid-30 percent" range.

    Corning's Telecommunications segment second-quarter
sequential sales growth is expected to be in the range of
10 percent to 15 percent, driven primarily by continued
growth in fiber and cable and hardware and equipment
products.

    Second-quarter sales in the company's Environmental
Technologies segment are expected to increase about 5
percent sequentially due primarily to expected increases in
the company's diesel products sales.  Sales for the Life
Sciences segment should be up about 5 percent
sequentially.

    Equity earnings for the second quarter are expected to
increase about 5 percent compared to the first quarter.

     "We are pleased with the company's first quarter
performance and believe we are well positioned for the
remainder of 2007.  The growing penetration rate of LCD
televisions and consumers' desire for larger screen sizes
should be favorable for our Display Technologies segment. 
We are also delighted to see more consistent growth in the
telecommunications industry.  Finally, global regulations
to improve emissions standards have provided us with
tremendous opportunities in the heavy-duty and light-duty
vehicle markets.  Together, these factors give us strong
reason to be optimistic about our performance in the second
quarter," Flaws concluded.

    Upcoming Investor Meetings

    Corning Incorporated Vice Chairman and Chief Financial
Officer James B. Flaws and Chief Operating Officer Peter F.
Volanakis will be meeting with investors at the Merrill
Lynch Tech Gathering in New York on May 1.

    Annual Shareholders Meeting

    Corning will hold its annual meeting of shareholders on
Thursday, April 26 beginning at 11 a.m. EDT in the Corning
Museum of Glass auditorium in Corning, N.Y.

    First-Quarter Conference Call Information

    The company will host a first-quarter conference call
on April 25 at 8:30 a.m. EDT.  To access the call, dial
[phone] approximately 10-15 minutes prior to the
start of the call.  The password is QUARTER ONE.  The
leader is SOFIO.  To listen to a live audio webcast of the
call, go to Corning's Web site at
http://www.corning.com/investor_relations and follow the
instructions.  A replay of the call will begin at
approximately 10:30 a.m. EDT, and will run through 5 p.m.
EDT, Wednesday, May 9.  To listen, dial [phone].  No
pass code is required.  The audio webcast will be archived
for one year following the call.

    Presentation of Information in this News Release

    Non-GAAP financial measures are not in accordance with,
or an alternative to, GAAP.  Corning's non-GAAP net income
and EPS measure excludes restructuring, impairment and
other charges and adjustments to prior estimates for such
charges.  Additionally, the company's non-GAAP measure
excludes adjustments to asbestos settlement reserves
required by movements in Corning's common stock price,
gains and losses arising from debt retirements, charges
resulting from the impairment of equity or cost method
investments, or adjustments to deferred tax assets, and
gains or losses recognized in equity earnings from
restructuring, impairment or other charges or credits taken
by equity method companies.  Corning's free cash flow
financial measures are also non-GAAP measures.  The company
believes presenting non-GAAP free cash flow; net income and
EPS measures are helpful to analyze financial performance
without the impact of unusual items that may obscure trends
in the company's underlying performance.  These non-GAAP
measures are reconciled on the company's Web site at
http://www.corning.com/investor_relations and accompany
this news release.

    About Corning Incorporated

    Corning Incorporated ( http://www.corning.com ) is the
world leader in specialty glass and ceramics.  Drawing on
more than 150 years of materials science and process
engineering knowledge, Corning creates and makes keystone
components that enable high-technology systems for consumer
electronics, mobile emissions control, telecommunications
and life sciences.  Our products include glass substrates
for LCD televisions, computer monitors and laptops; ceramic
substrates and filters for mobile emission control systems;
optical fiber, cable, hardware & equipment for
telecommunications networks; optical biosensors for drug
discovery;  and other advanced optics and specialty glass
solutions for a number of industries including
semiconductor, aerospace, defense, astronomy and
metrology.

    Forward-Looking and Cautionary Statements

    This press release contains forward-looking statements
that involve a variety of business risks and other
uncertainties that could cause actual results to differ
materially.  These risks and uncertainties include the
possibility of changes in global economic and political
conditions; currency fluctuations; product demand and
industry capacity; competition; manufacturing efficiencies;
cost reductions; availability of critical components and
materials; new product commercialization; changes in the
mix of sales between premium and non-premium products; new
plant start-up costs; possible disruption in commercial
activities due to terrorist activity, armed conflict,
political instability or major health concerns; adequacy of
insurance; equity company activities; acquisition and
divestiture activities; the level of excess or obsolete
inventory; the rate of technology change; the ability to
enforce patents; product and components performance issues;
stock price fluctuations; and adverse litigation or
regulatory developments.  Additional risk factors are
identified in Corning's filings with the Securities and
Exchange Commission.  Forward-looking statements speak only
as of the day that they are made, and Corning undertakes no
obligation to update them in light of new information or
future events.


    For more information, please contact: 

     Media Relations Contact:          Investor Relations
Contact:
     Daniel F. Collins                 Kenneth C. Sofio
     Tel:   [phone]            Tel:  
[phone]
     Email: [e-mail]      Email:
[e-mail]