Financial Instruments

12 Months Ended

Dec. 31, 2024

13. Financial Instruments

The following table summarizes the notional amounts and respective fair values of Corning’s derivative financial instruments on a gross basis as of December 31, 2024 and 2023 (in millions):


	December 31, 2024						December 31, 2023
	Notional amount		Fair value asset (1)		Fair value liability (1)		Notional amount		Fair value asset (1)		Fair value liability (1)
Derivatives designated as hedging instruments (2):
Foreign exchange and precious metals lease contracts (3)	$	928	$	106	$	(69)	$	241	$	287

Derivatives not designated as hedging instruments:
Foreign exchange contracts	2,339		14		(77)		1,988		20		$	(17)
Translated earnings contracts (4)	9,817		859		(327)		5,042		324		(80)
Cross currency swap contracts	439				(148)
Total derivatives	$	13,523	$	979	$	(621)	$	7,271	$	631	$	(97)

Current			$	619	$	(348)			$	501	$	(66)
Non-current			360		(273)				130		(31)
Total derivatives			$	979	$	(621)			$	631	$	(97)

(1)All of the Company’s derivative contracts are measured at fair value and are classified as Level 2 within the fair value hierarchy. Derivative assets are presented in other current assets or other assets in the consolidated balance sheets. Derivative liabilities are presented in other accrued liabilities or other liabilities in the consolidated balance sheets.

(2)The amounts above do not include €850 million of euro-denominated debt ($879 million and $932 million equivalent as of December 31, 2024 and 2023, respectively), which is a non-derivative financial instrument designated as a net investment hedge.

(3)As of December 31, 2024, derivatives designated as hedging instruments include foreign exchange cash flow hedges with gross notional amounts of $928 million and fair value hedges of leased precious metals with a gross notional amount of 12,694 troy ounces. As of December 31, 2023, derivatives designated as hedging instruments include foreign exchange cash flow hedges with gross notional amounts of $241 million and fair value hedges of leased precious metals with a gross notional amount of 20,160 troy ounces. Fair value assets include designated derivatives pertaining to precious metals lease contracts in the amounts of $104 million and $229 million as of December 31, 2024 and 2023, respectively.

(4)The Company has deferred payments associated with its purchased option contracts that are classified as non-derivative liabilities and will be settled by the end of the option contract term. As of December 31, 2024, the Company has $141 million and $172 million recorded in other accrued liabilities and other liabilities, respectively, in the consolidated balance sheets.

The following table summarizes the total gross notional value for translated earnings contracts as of December 31, 2024 and 2023 (in millions):


	Year ended December 31,
	2024		2023
Average rate forward contracts:
Chinese yuan-denominated	$	864	$	684
Japanese yen-denominated	259		463
South Korean won-denominated	1,151		1,609
New Taiwan dollar-denominated	503		198
Euro-denominated	1,538
Mexican peso-denominated	320
Option contracts:
Japanese yen-denominated	4,997		2,088
Euro-denominated	185
Total gross notional value for translated earning contracts	$	9,817	$	5,042

The following tables summarize the effect in the consolidated statements of income relating to Corning’s derivative financial instruments (in millions). The accumulated derivative (loss) gain included in accumulated other comprehensive loss on the consolidated balance sheets as of December 31, 2024 and 2023 is $(11) million and $54 million, respectively.


	(Loss) gain recognized in other comprehensive income (OCI)						Location of gain (loss) reclassified from accumulated OCI into income effective (ineffective)	Gain (loss) reclassified from accumulated OCI into income
	2024		2023		2022			2024		2023		2022
Derivatives hedging relationships for cash flow and fair value hedges:
Foreign exchange and precious metals lease contracts	$	(18)	$	81	$	52	Net sales					$	52
							Cost of sales	$	47	$	49	32
							Other (expense) income, net	(1)		(3)		(3)
Total cash flow and fair value hedges	$	(18)	$	81	$	52		$	46	$	46	$	81


	(Loss) gain recognized in income
Undesignated derivatives	2024		2023		2022		Location of gain recognized in income
Foreign exchange contracts	$	(80)	$	26	$	46	Other (expense) income, net
Translated earnings contracts	83		161		351		Translated earnings contract gain, net
Cross currency swap contracts	(15)						Other (expense) income, net
Total undesignated	$	(12)	$	187	$	397

Cross Currency Swap Contracts

Since inception of the Company’s Japanese yen-denominated debt, the Japanese yen has weakened and the U.S. dollar value of these liabilities has decreased, generating unrealized foreign exchange gains that have been recognized over time in the consolidated statements of income. In 2024, to economically lock in unrealized foreign exchange gains, the Company entered into various cross currency swap contracts relating to a portion of the Company’s Japanese yen-denominated debt due in 2027 and 2028. The cross currency swap contracts have expiration dates in 2027 and 2028. At inception of these instruments, Corning received a net from the counterparties, representing an exchange of the notional amounts at a fixed foreign exchange rate of Japanese yen to U.S. dollar and was initially recorded as a derivative liability. The net payments received were $134 million and as of December 31, 2024, the fair value of this derivative liability is $148 million.

Net Investment Hedges

In May 2023, Corning designated the full amount of its euro-denominated 2026 Notes and 2031 Notes with a total notional amount of €850 million, which are non-derivative financial instruments, as net investment hedges against our investments in certain European subsidiaries with euro functional currencies. As of December 31, 2024, the net investment hedges are deemed to be effective. During the years ended December 31, 2024 and 2023, foreign currency gains of $55 million and foreign currency losses of $5 million, respectively, associated with these net investment hedges were recognized in other comprehensive income.

Leased Precious Metals Contracts

The carrying amount of the leased precious metals pool, which is included within property, plant and equipment, net of accumulated depreciation in the consolidated balance sheets, is $58 million and $90 million, respectively, as of December 31, 2024 and 2023. The carrying amount of the leased precious metals pool includes cumulative fair value loss of $108 million and $239 million as of December 31, 2024 and 2023, respectively. These losses are offset by changes in the fair value of the hedges.