Note 12 - Shareholders' Equity

3 Months Ended

Mar. 31, 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 (“Initial Closing Date”), Corning and Samsung Display Co., Ltd. ("SDC") executed the Share Repurchase Agreement (“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 the Initial Closing Date. Subsequent payments of approximately $507 million will be paid on each of the first and second anniversaries of the Initial Closing Date.

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 and 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 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 months ended March 31, 2022, the Company repurchased 3.9 million shares of common stock on the open market for approximately $151 million as part of its 2019 Repurchase Program.

The Company made no open market share repurchases for the three months ended March 31, 2021. 

Accumulated Other Comprehensive Loss

In the three months ended March 31, 2022 and 2021, the change in accumulated other comprehensive loss 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 is as follows (in millions) ⁽¹⁾:

	Three months ended
	March 31,
	2022			2021
Beginning balance	$	(933	)	$	(329	)
Losses on foreign currency translation (2)		(198	)		(355	)
Equity method affiliates (3)		(2	)		(8	)
Net current-period other comprehensive loss		(200	)		(363	)
Ending balance	$	(1,133	)	$	(692	)

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

⁽²⁾ For the three months ended March 31, 2022 and 2021, amounts are net of tax benefit of $11 million and $10 million, respectively.  

⁽³⁾ Tax effects are not significant.