Note 2 - Restructuring, Impairment and Other Charges and Credits

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Restructuring and Related Activities Disclosure [Text Block]

The following table presents the restructuring, impairment and other charges and credits (in millions):

	Year ended December 31,
	2022		2021			2020
Severance	$	70	$	(13	)	$	148
Asset impairment							217
Capacity optimization		219		46			304
Other charges and credits		125		77			158
Total restructuring, impairment and other charges and credits	$	414	$	110		$	827

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.

2022

Corning recorded $414 million in severance, accelerated depreciation, asset write-offs and other related charges for the year ended December 31, 2022. Capacity optimization charges include accelerated depreciation and asset write-offs associated with the exit of certain facilities, product lines and other exit activities primarily within Display Technologies, Specialty Materials and an emerging growth business. Severance charges were recorded across all segments and as of December 31, 2022, the severance accrual is not material and is expected to be settled within the next twelve months.

2020

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, write-offs of certain assets and accelerated depreciation associated with the capacity optimization of certain manufacturing facilities as well as other exit charges and credits.

Severance

During the second quarter of 2020, Corning 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.

Asset Impairment

During 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 relating to a business within Hemlock and Emerging Growth Businesses. 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. The fair value of the asset group for the impairment analysis was measured using unobservable (Level 3) inputs.

Capacity Optimization

Capacity optimization for the year ended December 31, 2020 primarily includes accelerated depreciation and asset write-offs associated with the exit of certain facilities and other exit activities in the Display Technologies and Specialty Materials business segments.

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

	Year ended December 31, 2022
			Selling,		Research,
			general		development
			and		and
	Gross		administrative		engineering
	margin (1)		expenses		expenses		Other		Total
Severance	$	25	$	32	$	13			$	70
Capacity optimization		215		4						219
Other charges and credits		97		15		3	$	10		125
Total restructuring, impairment and other charges and credits	$	337	$	51	$	16	$	10	$	414

	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 optimization		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 optimization		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

(1) Activity reflected in cost of sales.