We have said all year that an inflection in display pricing is not in expectations, models, etc. for 2018 Corning expectations. The stock is up today - in part - because with better 3Q volumes we are nudging incrementally faster towards tightness and the pivot continues. We have completed more work in this category, including on technology based supply growth, cost curve, and price declines.
Bottom line: TV sell-through estimates into the Q didn’t help us get 3Q right but our Long thesis all through 2017 continues to prove prescient, with results continuing to signal in-line with our original views on diplay + optical (if maybe not for FCF just yet).
What we loved/hated on the Q:
- Loved: Great volume in display, much better than feared
- Hated: why doesn’t that translate to profits or cash flow
- Loved: ASP curve continues to heal based on modeling y/y for 4Q off guidance
- Loved: everything about the topline including optical, GG, and environment.
- Hated: growth needs to translate to OCF growth too
