Authors:Mr. Stuart Rock

Mr. Andrew BachmanMr. Michael Thomas

(12/13/2012)

Corning Inc. Technology-based corporation

160 years in the glass industry

In 2011:

net sales: $7.89 billion

net income: $2.805 billion

Product Leadership

Commitment to display glass technology

“Corning’s 7 Values: Quality, Integrity, Performance, Leadership, Innovation, Independence, and The Individual. All the time, all around the world.” – Wendell P .Weeks (Corning Chairman of the Board, President, & CEO)

10 Year Performance (Stock Price)

*in millions2011 Statement of Cash Flows:

Willow Glass Ultra Thin Flexible Glass

High Surface Quality

Roll-to-roll Processing

Primary use:

mobile device displays

Many Applications

Opportunity & Key Challenges

Technology Intelligence Jill VanDewoestine

(Product Manager for Willow Glass)

With Willow since inception

Stages of Development

Initial R&D spending

Funding outside research

Develop products with Willow Glass

Opening production facilities

Product ecosystem

“The electronics industry has the ultimate goal of being able to print displays using roll-to-roll processing… That is the future for Willow Glass” –Jill VanDewoestine

Technology Strategy Overview Build production level plant to test Willow

For safety, performance, scalability, efficiency

Form & strengthen partnerships

Dependence on Compliments

Full scale production plants

Expand to new markets

Develop new technologies

Increased durability & support

Fuse battery with display screen

Linked Projects & Strategy:

Financials

•Initial revenues are low•Revenue increases with market share•Revenue is delayed several years

•Market for flexible display glass•Capture large portion•Early-mover advantage

Assumptions:– Smartphone glass market = 32 million sq. meters per year– Market Share: 30%– Cost of Capital: 18%– Cost to Consumers: $40 per sqm

Financials

Annual Net Cash Flow• Currently “Valley of Death”•Profitably in 2014•Sharp rise in profit from2013-2015• High profits after 2016

Net Present Value Analysis•NPV: $110 Million•Total Investment Cost

$45.6 Million•Based on future cash flows• 5% discount rate

Project Key: Willow Glass1. Basic (uncoated) rolls2. ITO coating3. Coated for printed displays

Annual Net Cash Flow

2014 2015 2016 2017 2018 2019 2020 202120132012

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Conclusions Willow Glass is Corning’s next big product

Requires substantial initial investment

Large potential for growth

Wait for the device technology to catch up

Capitalize on existing relationships

Positive publicity, expand into new markets

Create the next generation of displays

Questions?

Markets?

Challenges?

Financials?

Comments?

ReferencesMcEntegart, Jane. "Gorilla Glass Maker Corning Debuts Flexible Willow Glass." Tom's Hardware. Tablets and Spartphones, 4 June 2012. Web. 04 Dec. 2012. <http://

www.tomshardware.com/news/Gorilla-Glass-Corning-Flexible-Glass-Curved- Glass-Willow-Glass,15879.html>.

Speculations, Great. "Don't Weep Like A Willow: Bendable Glass Not Likely For IPhone 5." Forbes. Forbes Magazine, 18 June 2012. Web. 06 Dec. 2012.

Garner, S., Merz, G., Tosch, J., Matusick, J., Li, X., Marshall, D., Chase, C., Steiner, J., Yepez, D., Switzer, J., Moschak, P., "Flexible glass substrates for roll-to-roll manufacturing,”

FlexTech Flexible Electronics and Displays Conference, Phoenix, February 7-10, 2011."ANALYST: Smartphone Sales Will Dwarf PC Sales This Year And Reach A Staggering 1.5 Billion Per Year By 2016." Business Insider. N.p., 29 Feb. 2012. Web. 14 Sept. 2012. http://articles.businessinsider.com/2012-02-29/tech/31109577_1_smartphones-pc-sales-internet