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Corning Posts $4.8B Loss

Glassmaker-turned-fiber-optic concern Corning Inc. posted a net loss of $4.8 billion for its second quarter, because of merger-related charges and the write down of obsolete inventory. But when those charges are factored out, the company not only made money, it beat Wall Street estimates.

Corning's net loss came in at $5.13 a share, compared with net income of $149 million or $0.17 per share, in the year-ago second quarter.

Without the charges, Corning said it earned $0.29 a share in the quarter. The consensus of analysts' estimates, as tracked by Thomson Financial/First Call, had Corning coming in at $0.18 a share.

Corning's revenues were up 5 percent to $1.87 billion from $1.78 billion in the year-ago period.

Optical-cable and fiber sales were up by 7 percent to $939 million in the quarter from $875 million in this year's first quarter. Photonic-technologies sales, though, dropped 33 percent to $158 million.

In a statement, John W. Loose, Corning president and chief executive officer, said, "Except for the disappointing results in the Photonic Technologies business, the company's second-quarter operating performance was significantly better than expected, primarily due to the strong results in the fiber and cable business. As anticipated, sales of LEAF fiber, our premium high-data-rate optical fiber, remain significantly behind last year. However, we continue to see strong gains in overall fiber sales in Asia, particularly in China. We are also seeing a rebound in the flat-panel display business."

In terms of outlook, Loose said, "The telecommunications market outlook remains turbulent. We continue to see a very significant decrease in the long-haul market in North America. The impact of this market decline has been most severe on our sales of LEAF fiber to new carriers and on our photonics business. We have been able to partially offset the decline in the North America long-haul market with increased sales of single-mode fiber, sales of LEAF fiber in China, and stable pricing. However, we think the photonics business will continue to be weak for the remainder of the year."

Loose did not provide specific guidance in a release after Wednesday's market close, however.