Note 12 - Shareholders' Equity

6 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

12. Shareholders’ Equity

Fixed Rate Cumulative Convertible Preferred Stock, Series A 

On January 16, 2021, the Preferred Stock became convertible into 115 million common shares.  On April 5, 2021, Corning and SDC executed the SRA, and the Preferred Stock was fully converted as of April 8, 2021. 

Immediately following the conversion, Corning repurchased and retired 35 million of the common shares held by SDC for an aggregate purchase price of approximately $1.5 billion, of which approximately $507 million was paid on April 8, 2022 and 2021, respectively.  The remaining payment of approximately $507 million will be paid on April 8, 2023.

The remaining 80 million common shares were accounted for as a conversion of Preferred Stock and resulted in an increase of common stock and additional paid-in-capital based on the carrying value of the Preferred Stock.  These common shares were included in the weighted-average common shares outstanding for the calculation of the Company’s basic and diluted earnings per share.  SDC has the option to sell 22 million common shares to Corning subject to certain conditions beginning in 2024-2027. The remaining 58 million common shares are subject to a seven-year lock-up period expiring in 2027.   

Share Repurchases

On April 26, 2018, Corning’s Board of Directors approved a $2 billion share repurchase program with no expiration date (the “2018 Repurchase Program”).  On July 17, 2019, Corning’s Board of Directors authorized $5 billion in share repurchases with no expiration date (the “2019 Repurchase Program”).

For the three and six months ended June 30, 2022, the Company repurchased 1.6 million shares and 5.5 million shares, respectively of common stock on the open market for approximately $53 million and $204 million, respectively as part of its 2019 Repurchase Program.

For the three and six months ended June 30, 2021, the Company repurchased approximately 35 million shares of common stock under the 2018 and 2019 Repurchase Programs.

Accumulated Other Comprehensive (Loss) Income

In the three and six months ended June 30, 2022 and 2021, the change in accumulated other comprehensive (loss) income was primarily related to the foreign currency translation adjustment.

A summary of changes in the foreign currency translation adjustment component of accumulated other comprehensive (loss) income is as follows (in millions) ⁽¹⁾:

	Three months ended						Six months ended
	June 30,						June 30,
	2022			2021			2022			2021
Beginning balance	$	(1,133	)	$	(692	)	$	(933	)	$	(329	)
(Losses) gains on foreign currency translation (2)		(635	)		39			(833	)		(316	)
Equity method affiliates (3)		(15	)		1			(17	)		(7	)
Net current-period other comprehensive (loss) income		(650	)		40			(850	)		(323	)
Ending balance	$	(1,783	)	$	(652	)	$	(1,783	)	$	(652	)

⁽¹⁾ All amounts are after tax. Amounts in parentheses indicate debits to accumulated other comprehensive (loss) income.

⁽²⁾ For the three and six months ended June 30, 2022, amounts are net of tax benefit of $27 million and $38 million, respectively.  For the three and six months ended June 30, 2021, amounts are net of tax benefit of $1 million and $11 million, respectively

⁽³⁾ Tax effects are not significant.