Corning Incorporated (GLW 0.44%) released solid first-quarter 2018 results on Tuesday morning. The glass technologist met or exceeded expectations in each of its five business segments, and it clarified its growth targets both for the coming year and longer term.

With shares down almost 3% in response -- a move likely aided by a broader pullback in tech stocks today -- let's take a closer look at how Corning kicked off 2018.

Corning scientist in white scrubs and blue gloves working on glass products


Corning's first-quarter headline numbers

Corning's core net sales increased 3.8% year over year to $2.513 billion. Based on generally accepted accounting principles (GAAP), that technically translated to a net loss of $589 million, or $0.72 per share. But similar to last quarter's GAAP net loss -- which stemmed from a one-time, non-cash adjustment from recent U.S. tax reform -- this time, Corning's reported red ink came from a non-cash, mark-to-market loss associated with the company's currency-hedging program.

On an adjusted (non-GAAP) basis, core earnings were $299 million, or $0.31 per share, down from $0.36 per share in the same year-ago period. Through that lens, both the top and bottom lines arrived slightly above investors' expectations for core earnings of $0.30 per share on revenue of $2.50 billion.

Corning CEO Wendell Weeks also offered an update on their ongoing strategic and capital allocation plan, stating that progress on "all framework objectives remains excellent."

Under that four-year plan, unveiled in late 2015, Corning has returned $10 billion to shareholders through dividends and stock repurchases, including $953 million this quarter alone. Corning maintains its goal of reaching capital returns of more than $12.5 billion, including annual dividend increases of at least 10%. Corning further remains on track to meet its target for investing at least $10 billion in the business to capture future growth opportunities.

Breaking it down

Optical Communications remained Corning's single largest segment, with net sales climbing 8% year over year to $886 million driven by data center and carrier businesses. Corning continues to invest in optical capacity expansions to support customer demand.

At Display Technologies, net sales fell 5% to $745 million, driven by lower LCD glass volume given normal seasonality. In fact, the continued sequential decline in LCD glass prices was the most favorable that Corning has seen since early 2010. Display Technologies net income declined 24% to $185 million, in line with expectations.

Meanwhile, Environmental Technologies sales grew 17% to $322 million, driven by strength in ceramic substrates for the automotive market, the heavy-duty diesel market, and Corning's newer gas particulate filter business. Environmental net income increased 18% to $52 million.

Life Sciences sales climbed 10% to $232 million, as Corning's portfolio of laboratory bottles, flasks, tubes, tools, and the like continued to outgrow the overall market. Life Sciences net income rose 13% to $27 million. But note this doesn't include sales of Corning's newer Valor Glass pharmaceutical packaging solution, introduced last July, for which Corning recently announced a new high-volume manufacturing facility to be built in Durham County, North Carolina.

Last but not least, sales at Corning's Specialty Materials fell 7% year over year to $278 million -- better than the 10% decline management predicted last quarter as some customers built Gorilla Glass inventory toward the end of 2017 to support their respective product launches. Specialty Materials net income fell 19% to $46 million.

On Corning's longer-term goals

Corning doesn't provide specific consolidated revenue or earnings guidance. But as usual, it did shed light on its broader short- and long-term expectations for each segment.

For one, Optical Communications sales should increase in the low-teens percent range in the second quarter. Corning continues to expect Optical sales to increase approximately 10% for all of 2018. That full-year outlook excludes incremental sales of its impending acquisition of 3M's Communication's Markets Division, which should close later this year. Corning also reiterated its longer-term prediction that Optical will grow into a $5 billion annual business by 2020 -- up from $3.5 billion last year.  

By contrast, Corning's goal for Display Technologies is to maintain stable returns in the LCD glass market. Corning still assumes this market will grow in the mid-single-digit range, while its own full-year volume should outpace the market as it ramps production. Perhaps most important, here, Corning believes that LCD glass price declines should further moderate in the second quarter, marking their best second quarter for the metric in the past decade.

At Life Sciences, Corning anticipates sales will climb in the high-single-digit range in the second quarter, leading it to reiterate its previous guidance for a mid-single-digit percent increase for the full year.

At Environmental Technologies, Corning now sees sales increasing roughly 10% for the full year of 2018 -- a slight increase from previous guidance for high-single-digit percent growth. For the second quarter, Environmental sales should be up in the high teens.

Finally, Corning sees Specialty Materials continuing to slide in the second quarter, this time falling in the mid- to high-single-digit range year over year. Similar to last quarter's guidance, Corning management believes that Specialty Materials sales should grow for the full year. But the rate of that growth will depend on the timing and extent of new model launches featuring its innovations. To that end, Corning is on track to launch its next generation of Gorilla Glass in the second half of this year.

The bottom line

Corning CFO Tony Tripeny explained:

As we have communicated previously, Corning is in a phase of our Strategy and Capital Allocation Framework in which we are investing intensely for long-term secular growth. Execution is on target, and several of our larger expansion projects are coming on line. We look forward to realizing significant sales and profitability benefits as this new capacity ramps during the second half of the year.

All things considered, there were no significant surprises in this slightly better-than-expected report. Rather, Corning's core business remains healthy, and the company is investing heavily to drive future growth while boosting production to meet current demand. As such, I think patient investors should be more than pleased.