Note 2 - Restructuring, Impairment and Other Charges and Credits

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Restructuring and Related Activities Disclosure [Text Block]

The following restructuring, impairment and other charges and credits were recorded (in millions):

	Year ended December 31,
	2021			2020		2019
Severance	$	(13	)	$	148	$	63
Asset impairment					217
Capacity realignment		46			304		312
Other charges and credits		77			158		64
Total restructuring, impairment and other charges and credits	$	110		$	827	$	439

Corning periodically assesses the operating efficiency and cost structure of the Company's asset base and global workforce and takes appropriate actions to align corporate resources with the business environment.

In 2020, and in response to uncertain global economic conditions, Corning undertook actions to transform the Company’s cost structure and improve operational efficiency. These actions included a corporate-wide workforce reduction program, disposals of certain assets and accelerated depreciation associated with the capacity realignment of certain manufacturing facilities as well as other exit charges and credits.

Severance

In the second quarter of 2020, the Company implemented a corporate-wide workforce reduction program. Severance charges were primarily incurred to facilitate realignment of capacity in the Asia regions for the Display Technologies segment, optimize the Optical Communications segment and contain corporate costs. For the years ended December 31, 2020 and 2019, severance charges were $148 million and $63 million, respectively.  As of December 31, 2021, the payments related to the severance liability have been substantially completed.

Asset Impairment

For the year ended December 31, 2020, Corning incurred a long-lived asset impairment and disposal loss for an asset group related to the reassessment of research and development programs within “All Other”. Given the economic environment and market opportunities, Corning discontinued its investment in these research and development programs. The impairment analysis and disposition of certain assets resulted in a total pre-tax charge of $217 million, which was substantially all the carrying value, inclusive of an insignificant amount of goodwill.

Capacity Realignment

Capacity realignment for the year ended December 31, 2020, primarily includes accelerated depreciation and asset disposals associated with the exit of certain facilities and other exit activities in the Display Technologies and Specialty Materials business segments.  Capacity realignment for the year ended December 31, 2019, is primarily comprised of accelerated depreciation associated with the exit of certain facilities in the Display Technologies segment.

The following tables present the impact and respective location of total restructuring, impairment, and other charges and credits on the consolidated statements of income (in millions):

	Year ended December 31, 2021
				Selling,			Research,
				general			development
				and			and
	Gross			administrative			engineering
	margin (1)			expenses			expenses			Other		Total
Severance	$	(6	)	$	(5	)	$	(2	)			$	(13	)
Capacity realignment		36			7			3					46
Other charges and credits		50			(5	)				$	32		77
Total restructuring, impairment and other charges and credits	$	80		$	(3	)	$	1		$	32	$	110

	Year ended December 31, 2020
			Selling,		Research,
			general		development
			and		and
	Gross		administrative		engineering
	margin (1)		expenses		expenses		Other		Total
Severance	$	83	$	34	$	31			$	148
Asset impairment				6		211				217
Capacity realignment		288		16						304
Other charges and credits		72		60		5	$	21		158
Total restructuring, impairment and other charges and credits	$	443	$	116	$	247	$	21	$	827

	Year ended December 31, 2019
			Selling,		Research,
			general		development
			and		and
	Gross		administrative		engineering
	margin (1)		expenses		expenses		Other			Total
Severance	$	30	$	20	$	13				$	63
Capacity realignment		298				14					312
Other charges and credits		60		8		3	$	(7	)		64
Total restructuring, impairment and other charges and credits	$	388	$	28	$	30	$	(7	)	$	439

(1) Activity reflected in cost of sales.