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Reportable Segments | 9 Months Ended
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Sep. 30, 2018
Reportable Segments [Abstract] |
Reportable Segments | 15. Reportable Segments ﻿ Our reportable segments are as follows: ﻿
| · |  | Display Technologies – manufactures glass substrates primarily for flat panel displays.
| · |  | Optical Communications – manufactures carrier and enterprise network components for the telecommunications industry.
| · |  | Specialty Materials – manufactures products that provide more than 150 material formulations for glass, glass ceramics and fluoride crystals to meet demand for unique customer needs.
| · |  | Environmental Technologies – manufactures ceramic substrates and filters for automotive and diesel applications.
| · |  | Life Sciences – manufactures glass and plastic labware, equipment, media and reagents enabling workflow solutions for scientific applications.
﻿ All other segments that do not meet the quantitative threshold for separate reporting have been grouped as “All Other.” This group is primarily comprised of the results of the pharmaceutical technologies business and new product lines and development projects, as well as certain corporate investments such as Eurokera and Keraglass equity affiliates. Effective beginning in the first quarter of 2018, the Company has changed its measurement of segment sales and segment net income, and has recast prior periods presented based on the new methodology. Included in this new measurement is a change in our segment tax rate to 21% to better reflect the new corporate tax rate under the 2017 Tax Act. Additionally, t he impact of changes in the Japanese yen, Korean wo n, Chinese yuan and New Taiwan d ollar will be excluded from segment sales and segment net income for the Display Technologies and Specialty Materials segments, and certain income and expenses that were previously allocated to our segments are now included in the unallocated amounts in the reconciliation of reportable segment net income to consolidated net income. These include items that are not used by our chief operating decision maker (“CODM”) in evaluating the results of or in allocating resources to our segments and include the following items: the impact of our translated earnings contracts; acquisition-related costs; discrete tax items and other tax-related adjustments; litigation, regulatory and other legal matters; restructuring, impairment and other charges; adjustments relating to acquisitions; and other non-recurring non-operational items. Although we exclude these amounts from segment results, they are included in reported consolidated results. ﻿ We prepared the financial results for our reportable segments on a basis that is consistent with the manner in which we internally disaggregate financial information to assist the CODM in making internal operating decisions. We included the earnings of equity affiliates that are closely associated with our reportable segments in the respective segment’s net income. We have allocated certain common expenses among reportable segments differently than we would for stand-alone financial information. Segment net income may not be consistent with measures used by other companies. Reportable Segments (in millions) ﻿ ﻿ ﻿
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﻿ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Display |  | Optical |  | Specialty |  | Environmental |  | Life |  | All |  |  |
﻿ |  | Technologies |  | Communications |  | Materials |  | Technologies |  | Sciences |  | Other |  | Total
﻿Three months ended |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿September 30, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿Segment net sales |  | $ | 852 |  | $ | 1,117 |  | $ | 459 |  | $ | 331 |  | $ | 231 |  | $ | 55 |  | $ | 3,045
﻿Depreciation (1) |  | $ | 146 |  | $ | 55 |  | $ | 34 |  | $ | 30 |  | $ | 12 |  | $ | 10 |  | $ | 287
﻿Research, development and engineering expenses (2) |  | $ | 26 |  | $ | 53 |  | $ | 43 |  | $ | 28 |  | $ | 5 |  | $ | 58 |  | $ | 213
﻿Income tax (provision) benefit |  | $ | (57) |  | $ | (46) |  | $ | (31) |  | $ | (16) |  | $ | (8) |  | $ | 19 |  | $ | (139)
﻿Segment net income (loss) (3) |  | $ | 218 |  | $ | 168 |  | $ | 116 |  | $ | 60 |  | $ | 30 |  | $ | (72) |  | $ | 520
﻿ ﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Display |  | Optical |  | Specialty |  | Environmental |  | Life |  | All |  |  |
﻿ |  | Technologies |  | Communications |  | Materials |  | Technologies |  | Sciences |  | Other |  | Total
﻿Three months ended |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿September 30, 2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿Segment net sales |  | $ | 795 |  | $ | 917 |  | $ | 373 |  | $ | 277 |  | $ | 223 |  | $ | 50 |  | $ | 2,635
﻿Depreciation (1) |  | $ | 134 |  | $ | 49 |  | $ | 34 |  | $ | 31 |  | $ | 14 |  | $ | 12 |  | $ | 274
﻿Research, development and engineering expenses (2) |  | $ | 21 |  | $ | 44 |  | $ | 38 |  | $ | 28 |  | $ | 6 |  | $ | 53 |  | $ | 190
﻿Income tax (provision) benefit |  | $ | (56) |  | $ | (35) |  | $ | (22) |  | $ | (11) |  | $ | (7) |  | $ | 17 |  | $ | (114)
﻿Segment net income (loss) (3) |  | $ | 211 |  | $ | 132 |  | $ | 86 |  | $ | 40 |  | $ | 25 |  | $ | (64) |  | $ | 430
﻿ ﻿
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﻿ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Display |  | Optical |  | Specialty |  | Environmental |  | Life |  | All |  |  |
﻿ |  | Technologies |  | Communications |  | Materials |  | Technologies |  | Sciences |  | Other |  | Total
﻿Nine Months Ended |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿September 30, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿Segment net sales |  | $ | 2,377 |  | $ | 3,026 |  | $ | 1,080 |  | $ | 970 |  | $ | 708 |  | $ | 156 |  | $ | 8,317
﻿Depreciation (1) |  | $ | 436 |  | $ | 160 |  | $ | 102 |  | $ | 89 |  | $ | 39 |  | $ | 31 |  | $ | 857
﻿Research, development and engineering expenses (2) |  | $ | 76 |  | $ | 153 |  | $ | 123 |  | $ | 86 |  | $ | 15 |  | $ | 174 |  | $ | 627
﻿Income tax (provision) benefit |  | $ | (157) |  | $ | (117) |  | $ | (60) |  | $ | (44) |  | $ | (23) |  | $ | 60 |  | $ | (341)
﻿Segment net income (loss) (3) |  | $ | 595 |  | $ | 427 |  | $ | 226 |  | $ | 166 |  | $ | 88 |  | $ | (224) |  | $ | 1,278
﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Display |  | Optical |  | Specialty |  | Environmental |  | Life |  | All |  |  |
﻿ |  | Technologies |  | Communications |  | Materials |  | Technologies |  | Sciences |  | Other |  | Total
﻿Nine Months Ended |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿September 30, 2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
﻿Segment net sales |  | $ | 2,354 |  | $ | 2,617 |  | $ | 1,010 |  | $ | 815 |  | $ | 654 |  | $ | 133 |  | $ | 7,583
﻿Depreciation (1) |  | $ | 393 |  | $ | 142 |  | $ | 94 |  | $ | 93 |  | $ | 39 |  | $ | 34 |  | $ | 795
﻿Research, development and engineering expenses (2) |  | $ | 63 |  | $ | 121 |  | $ | 111 |  | $ | 80 |  | $ | 18 |  | $ | 157 |  | $ | 550
﻿Income tax (provision) benefit |  | $ | (180) |  | $ | (100) |  | $ | (56) |  | $ | (33) |  | $ | (19) |  | $ | 48 |  | $ | (340)
﻿Segment net income (loss) (3) |  | $ | 682 |  | $ | 370 |  | $ | 213 |  | $ | 122 |  | $ | 71 |  | $ | (186) |  | $ | 1,272
﻿
| (1) |  | Depreciation expense for Corning’s reportable segments includes an allocation of depreciation of corporate property not specifically identifiable to a segment.
| (2) |  | Research, development and engineering expenses include direct project spending that is identifiable to a segment.
| (3) |  | Many of Corning’s administrative and staff functions are performed on a centralized basis. Where practicable, Corning charges these expenses to segments based upon the extent to which each business uses a centralized function. Other staff functions, such as corporate finance, human resources and legal, are allocated to segments, primarily as a percentage of sales. Expenses that are not allocated to the segments are included in the reconciliation of reportable segment net income to consolidated net income below.
﻿ A reconciliation of reportable segment and All Other net sales to consolidated net sales follows (in millions): ﻿
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Three months ended |  | Nine months ended
﻿ |  | September 30, |  | September 30,
﻿ |  | 2018 |  | 2017 |  | 2018 |  | 2017
﻿Net sales of reportable segments and All Other |  | $ | 3,045 |  | $ | 2,635 |  | $ | 8,317 |  | $ | 7,583
﻿ Impact of foreign currency movements (1) |  |  | (37) |  |  | (28) |  |  | (62) |  |  | (104)
﻿Net sales |  | $ | 3,008 |  | $ | 2,607 |  | $ | 8,255 |  | $ | 7,479
﻿ (1)This amount primarily represents the impact of foreign currency adjustments in the Display Technologies segment. ﻿ A reconciliation of reportable segment net income to consolidated net income follows (in millions): ﻿
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Three months ended |  | Nine months ended
﻿ |  | September 30, |  | September 30,
﻿ |  | 2018 |  | 2017 |  | 2018 |  | 2017
﻿Net income of reportable segments |  | $ | 592 |  | $ | 494 |  | $ | 1,502 |  | $ | 1,458
﻿Net loss of All Other |  |  | (72) |  |  | (64) |  |  | (224) |  |  | (186)
﻿Unallocated amounts: |  |  |  |  |  |  |  |  |  |  |  |
﻿ Impact of foreign currency movements |  |  | (42) |  |  | (34) |  |  | (110) |  |  | (124)
﻿ Gain (loss) on foreign currency hedges related to translated earnings |  |  | 230 |  |  | 26 |  |  | 66 |  |  | (193)
﻿ Translation gain on Japanese yen-denominated debt |  |  | 30 |  |  | 14 |  |  | 28 |  |  | 14
﻿ Litigation, regulatory and other legal matters |  |  | (11) |  |  |  |  |  | (143) |  |  | 12
﻿ Research, development, and engineering expense |  |  | (31) |  |  | (25) |  |  | (99) |  |  | (72)
﻿ Equity in earnings of affiliated companies (1) |  |  | 31 |  |  | 29 |  |  | 100 |  |  | 139
﻿ Amortization of intangibles |  |  | (27) |  |  | (18) |  |  | (68) |  |  | (53)
﻿ Interest expense, net |  |  | (38) |  |  | (27) |  |  | (111) |  |  | (79)
﻿ Income tax benefit (provision) |  |  | 6 |  |  | 25 |  |  | (42) |  |  | 164
﻿ Other corporate items |  |  | (43) |  |  | (30) |  |  | (125) |  |  | (165)
﻿Net income |  | $ | 625 |  | $ | 390 |  | $ | 774 |  | $ | 915
﻿
| (1) |  | Primarily represents the equity earnings of HSG.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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