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Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Economic Profit
Net Operating Profit after Taxes (NOPAT)
Cash Operating Taxes
Invested Capital
Cost of Capital
Economic Spread Ratio
Economic Profit Margin

Corning Inc., economic profit calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net operating profit after taxes (NOPAT)¹	817)	1,544)	2,088)	1,761)	968)
Cost of capital²	11.96%	12.38%	12.21%	11.13%	10.72%
Invested capital³	20,411)	19,666)	19,716)	21,233)	18,872)

Economic profit⁴	(1,625)	(891)	(320)	(602)	(1,055)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ NOPAT. See details »

² Cost of capital. See details »

³ Invested capital. See details »

⁴ 2023 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 817 – 11.96% × 20,411 = -1,625

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Item	Description	The company
Economic profit	Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital.	Corning Inc. economic profit decreased from 2021 to 2022 and from 2022 to 2023.

Corning Inc., NOPAT calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income attributable to Corning Incorporated	581)	1,316)	1,906)	512)	960)
Deferred income tax expense (benefit)¹	(75)	(46)	16)	(20)	(192)
Increase (decrease) in doubtful accounts²	(10)	(2)	(4)	5)	6)
Increase (decrease) in deferred revenue³	(9)	(43)	(112)	1,024)	—)
Increase (decrease) in equity equivalents⁴	(94)	(91)	(100)	1,009)	(186)
Interest expense	329)	292)	300)	276)	221)
Interest expense, operating lease liability⁵	42)	38)	31)	28)	21)
Adjusted interest expense	371)	330)	331)	304)	242)
Tax benefit of interest expense⁶	(78)	(69)	(70)	(64)	(51)
Adjusted interest expense, after taxes⁷	293)	261)	262)	241)	191)
Interest income	(38)	(15)	(11)	(15)	(21)
Investment income, before taxes	(38)	(15)	(11)	(15)	(21)
Tax expense (benefit) of investment income⁸	8)	3)	2)	3)	4)
Investment income, after taxes⁹	(30)	(12)	(9)	(12)	(17)
Net income (loss) attributable to noncontrolling interest	67)	70)	29)	11)	19)
Net operating profit after taxes (NOPAT)	817)	1,544)	2,088)	1,761)	968)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Elimination of deferred tax expense. See details »

² Addition of increase (decrease) in doubtful accounts.

³ Addition of increase (decrease) in deferred revenue.

⁴ Addition of increase (decrease) in equity equivalents to net income attributable to Corning Incorporated.

⁵ 2023 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 958 × 4.40% = 42

⁶ 2023 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 371 × 21.00% = 78

⁷ Addition of after taxes interest expense to net income attributable to Corning Incorporated.

⁸ 2023 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 38 × 21.00% = 8

⁹ Elimination of after taxes investment income.

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Item	Description	The company
NOPAT	Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income.	Corning Inc. NOPAT decreased from 2021 to 2022 and from 2022 to 2023.

Corning Inc., cash operating taxes calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Provision for income taxes	168)	411)	491)	111)	256)
Less: Deferred income tax expense (benefit)	(75)	(46)	16)	(20)	(192)
Add: Tax savings from interest expense	78)	69)	70)	64)	51)
Less: Tax imposed on investment income	8)	3)	2)	3)	4)
Cash operating taxes	313)	523)	542)	192)	494)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

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Item	Description	The company
Cash operating taxes	Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction.	Corning Inc. cash operating taxes decreased from 2021 to 2022 and from 2022 to 2023.

Corning Inc., invested capital calculation (financing approach)

US$ in millions

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Current portion of long-term debt and short-term borrowings	320)	224)	55)	156)	11)
Long-term debt, excluding current portion	7,206)	6,687)	6,989)	7,816)	7,729)
Operating lease liability¹	958)	906)	785)	729)	512)
Total reported debt & leases	8,484)	7,817)	7,829)	8,701)	8,252)
Total Corning Incorporated shareholders’ equity	11,551)	12,008)	12,333)	13,257)	12,907)
Net deferred tax (assets) liabilities²	(935)	(830)	(808)	(808)	(832)
Doubtful accounts³	30)	40)	42)	46)	41)
Deferred revenue⁴	860)	869)	912)	1,024)	—)
Equity equivalents⁵	(45)	79)	146)	262)	(791)
Accumulated other comprehensive (income) loss, net of tax⁶	2,048)	1,830)	1,175)	740)	1,171)
Non-controlling interest	317)	267)	212)	191)	90)
Adjusted total Corning Incorporated shareholders’ equity	13,871)	14,184)	13,866)	14,450)	13,377)
Construction in progress⁷	(1,944)	(2,335)	(1,979)	(1,918)	(2,757)
Invested capital	20,411)	19,666)	19,716)	21,233)	18,872)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Addition of capitalized operating leases.

² Elimination of deferred taxes from assets and liabilities. See details »

³ Addition of allowance for doubtful accounts receivable.

⁴ Addition of deferred revenue.

⁵ Addition of equity equivalents to total Corning Incorporated shareholders’ equity.

⁶ Removal of accumulated other comprehensive income.

⁷ Subtraction of construction in progress.

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Item	Description	The company
Invested capital	Capital is an approximation of the economic book value of all cash invested in going-concern business activities.	Corning Inc. invested capital decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Corning Inc., cost of capital calculations

Dec 31, 2023

	Capital (fair value)¹	Weights					Cost of capital
Equity²	27,465)	27,465)	÷	35,743)	=	0.77	0.77	×	14.54%	=	11.18%
Convertible preferred stock, Series A, par value $100 per share (book value)	—)	—)	÷	35,743)	=	0.00	0.00	×	0.00%	=	0.00%
Long-term debt and short-term borrowings³	7,320)	7,320)	÷	35,743)	=	0.20	0.20	×	4.30% × (1 – 21.00%)	=	0.70%
Operating lease liability⁴	958)	958)	÷	35,743)	=	0.03	0.03	×	4.40% × (1 – 21.00%)	=	0.09%
Total:	35,743)					1.00					11.96%

Based on: 10-K (reporting date: 2023-12-31).

¹ US$ in millions

² Equity. See details »

³ Long-term debt and short-term borrowings. See details »

⁴ Operating lease liability. See details »

Dec 31, 2022

	Capital (fair value)¹	Weights					Cost of capital
Equity²	30,197)	30,197)	÷	37,427)	=	0.81	0.81	×	14.54%	=	11.73%
Convertible preferred stock, Series A, par value $100 per share (book value)	—)	—)	÷	37,427)	=	0.00	0.00	×	0.00%	=	0.00%
Long-term debt and short-term borrowings³	6,324)	6,324)	÷	37,427)	=	0.17	0.17	×	4.26% × (1 – 21.00%)	=	0.57%
Operating lease liability⁴	906)	906)	÷	37,427)	=	0.02	0.02	×	4.20% × (1 – 21.00%)	=	0.08%
Total:	37,427)					1.00					12.38%

Based on: 10-K (reporting date: 2022-12-31).

¹ US$ in millions

² Equity. See details »

³ Long-term debt and short-term borrowings. See details »

⁴ Operating lease liability. See details »

Dec 31, 2021

	Capital (fair value)¹	Weights					Cost of capital
Equity²	34,925)	34,925)	÷	44,065)	=	0.79	0.79	×	14.54%	=	11.53%
Convertible preferred stock, Series A, par value $100 per share (book value)	—)	—)	÷	44,065)	=	0.00	0.00	×	0.00%	=	0.00%
Long-term debt and short-term borrowings³	8,355)	8,355)	÷	44,065)	=	0.19	0.19	×	4.21% × (1 – 21.00%)	=	0.63%
Operating lease liability⁴	785)	785)	÷	44,065)	=	0.02	0.02	×	4.00% × (1 – 21.00%)	=	0.06%
Total:	44,065)					1.00					12.21%

Based on: 10-K (reporting date: 2021-12-31).

¹ US$ in millions

² Equity. See details »

³ Long-term debt and short-term borrowings. See details »

⁴ Operating lease liability. See details »

Dec 31, 2020

	Capital (fair value)¹	Weights					Cost of capital
Equity²	28,337)	28,337)	÷	40,922)	=	0.69	0.69	×	14.54%	=	10.07%
Convertible preferred stock, Series A, par value $100 per share (book value)	2,300)	2,300)	÷	40,922)	=	0.06	0.06	×	4.25%	=	0.24%
Long-term debt and short-term borrowings³	9,556)	9,556)	÷	40,922)	=	0.23	0.23	×	4.12% × (1 – 21.00%)	=	0.76%
Operating lease liability⁴	729)	729)	÷	40,922)	=	0.02	0.02	×	3.90% × (1 – 21.00%)	=	0.05%
Total:	40,922)					1.00					11.13%

Based on: 10-K (reporting date: 2020-12-31).

¹ US$ in millions

² Equity. See details »

³ Long-term debt and short-term borrowings. See details »

⁴ Operating lease liability. See details »

Dec 31, 2019

	Capital (fair value)¹	Weights					Cost of capital
Equity²	21,359)	21,359)	÷	32,682)	=	0.65	0.65	×	14.54%	=	9.51%
Convertible preferred stock, Series A, par value $100 per share (book value)	2,300)	2,300)	÷	32,682)	=	0.07	0.07	×	4.25%	=	0.30%
Long-term debt and short-term borrowings³	8,511)	8,511)	÷	32,682)	=	0.26	0.26	×	4.20% × (1 – 21.00%)	=	0.86%
Operating lease liability⁴	512)	512)	÷	32,682)	=	0.02	0.02	×	4.10% × (1 – 21.00%)	=	0.05%
Total:	32,682)					1.00					10.72%

Based on: 10-K (reporting date: 2019-12-31).

¹ US$ in millions

² Equity. See details »

³ Long-term debt and short-term borrowings. See details »

⁴ Operating lease liability. See details »

Corning Inc., economic spread ratio calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in millions)
Economic profit¹	(1,625)	(891)	(320)	(602)	(1,055)
Invested capital²	20,411)	19,666)	19,716)	21,233)	18,872)
Performance Ratio
Economic spread ratio³	-7.96%	-4.53%	-1.62%	-2.83%	-5.59%
Benchmarks
Economic Spread Ratio, Competitors⁴
Apple Inc.	140.64%	202.13%	198.47%	146.40%	90.46%
Arista Networks Inc.	28.20%	23.66%	38.65%	20.99%	26.49%
Cisco Systems Inc.	9.13%	9.00%	8.25%	12.44%	6.64%
Super Micro Computer Inc.	9.81%	0.20%	-7.29%	-10.08%	-4.99%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Economic profit. See details »

² Invested capital. See details »

³ 2023 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × -1,625 ÷ 20,411 = -7.96%

⁴ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic spread ratio	The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital.	Corning Inc. economic spread ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Corning Inc., economic profit margin calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in millions)
Economic profit¹	(1,625)	(891)	(320)	(602)	(1,055)

Net sales	12,588)	14,189)	14,082)	11,303)	11,503)
Add: Increase (decrease) in deferred revenue	(9)	(43)	(112)	1,024)	—)
Adjusted net sales	12,579)	14,146)	13,970)	12,327)	11,503)
Performance Ratio
Economic profit margin²	-12.92%	-6.30%	-2.29%	-4.88%	-9.17%
Benchmarks
Economic Profit Margin, Competitors³
Apple Inc.	22.12%	23.89%	23.06%	19.19%	17.66%
Arista Networks Inc.	21.33%	16.33%	22.70%	16.41%	19.48%
Cisco Systems Inc.	9.08%	10.10%	9.20%	12.98%	7.01%
Super Micro Computer Inc.	3.32%	0.08%	-2.63%	-3.74%	-1.61%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Economic profit. See details »

² 2023 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted net sales
= 100 × -1,625 ÷ 12,579 = -12.92%

³ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic profit margin	The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin.	Corning Inc. economic profit margin deteriorated from 2021 to 2022 and from 2022 to 2023.

Corning Inc. (NYSE:GLW)

Economic Value Added (EVA)

Economic Profit

Net Operating Profit after Taxes (NOPAT)

Cash Operating Taxes

Invested Capital

Cost of Capital

Economic Spread Ratio

Economic Profit Margin