George Notter: I had a question about the optical business. You were talking about fiber connectivity impacts. I think you talked about customer pacing of projects as being the issue there. But as I look around the industry, it does seem like there’s been some inventory correction out there. I know lead times for fiber connectivity products at one point were quite long and now they’re, to a significant degree, a lot shorter. Is the issue there really customer pacing? Or is it more about excess inventory and you’re going through an inventory correction? Any thoughts would be great.
Wendell Weeks: To explain it out, what an outstanding question at what an interesting debate, right? So you’re thinking about inventory is how much they put in the ground determines how fast they burn through their inventory and of course, supply chain folks really across the globe since they couldn’t get everything they needed for sure, over ordered did all sorts of things, right? And as supply chain time, so that is certainly part of it. George no question, and I could even — I was less cynical, right? I could even explain most of the change as being that. But then I look on the other side, and I’m looking at the pace of the actual ground getting load via actual data centers getting built, right? If that — there’s a little bit of a disconnect there for me too in that if I took my customer statements of their deployment goals and integrated that , I’d say, yes, we have a very strong bounce back.
pretty soon. But we’re still going to take a little bit more of a conservative view. So I don’t know if any of that was helpful, to you. You made an excellent point, you could be absolutely right. We’re just going to play out a little bit more conservatively and not plan on sort of a big jump up in the back half, driven by the fact that inventory came in line with deployments.
George Notter: Got it. And just as a follow-up on that. When you think about that fiber connectivity business, is more of the issue then around data center build? Or is it more about fiber to the prem type builds or other types of optical networks? What would you kind of pin it on?
Wendell Weeks: It’s probably more fiber to the plan, okay? The hyperscale is definitely slower, right? But it’s more fiber to the premises. It’s those great big civil works builds that just aren’t moving fast enough yet for us to feel comfortable to call a strong recovery in that business. Now that being said, that can happen quick, right that can happen quickly because they haven’t come off their stated goals yet, but we’re just not seeing it.
Operator: Our next question comes from the line of Tim Long with Barclays.
Timothy Long: Just wanted to go back to display for two, if I could. First, Ed, could you talk a little bit about, obviously, a good recovery coming in the second quarter. I know you guys — you said it took a lot of tanks offline and did some retrofitting. So can you talk about kind of how much margin lift we’re going to see not just from the volume, but from some of the changes. And then just Wendell may, I just want to go back to kind of visibility in this business. Obviously, there was some last quarter, on utilization going up and then going down. So what level of visibility do you have into those utilization? I’m assuming you see well into this month, but how far out can you go with that?
Edward Schlesinger: So just to start with your first question, you’re right. I think one of the key dynamics we talk about all the time is glass supply-demand balance being key for pricing. So yes, we do manage our tank fleet in that respect. We will continue to do that and make sure that we manage our supply through that process. That does impact profitability that helps us going forward. I think a lot will have to do with how high the volume is in the quarter and how sort of all the dynamics play out.
Wendell Weeks: And I think our visibility will improve as we get to the end of this month, beginning of next. We have pretty good visibility, but our negotiations really are still going on given the pretty sharp upward inflection we’re seeing in customers’ volume requests. So that dynamic is still sort of playing out, but should get pretty clear over the next week or 2.
Ann Nicholson: I think we’ll take one last question.
Operator: Our last question is from the line of Martin Yang with Oppenheimer.
Zhihua Yang: There’s a reference on the call on new formulations for Gorilla Glass. Can you maybe comment on that? Is it in line with the annual upgrade cycle we have observed in the past? Or is that something a bit more significant similar to Ceramic Shield?
Wendell Weeks: Could you repeat the question? I lost you a little bit in the middle of that.
Zhihua Yang: The question is about the reference to Gorilla Glass this year. You — there’s a comment on new formulation for Gorilla Glass. So is that a new formulation, a similar upgrade in the past on an annual cycle? Or is that new formulation something a little bit more significant similar to the Ceramic Shield product?
Wendell Weeks: I got it now. So it’s not a jump up to glass ceramic. It’s a pretty significant improvement at the glass level, and we’re seeing really wide adoption but you’re not seeing that fundamental very big jump in our value-add per device that you see from switching to a fundamentally new material set with a very different manufacturing dynamics as well as drop dynamics. So pretty significant improvement, but in the same glass material set doesn’t have as much in terms of how much our sales revenue is is something like ceramic.
Ann Nicholson: I just want to thank everybody for joining us today. Before we close, I inform you that we will host our 2023 Annual Meeting of Shareholders on April 27. On May 23, we’re going to attend the JPMorgan 51st Annual Global Technology and Communications Conference. May 31 and June 1, we will be attending the Corning Annual Strategic Decisions Conference. And on June 22, we’ll be attending the Fox Advisors Virtual Transportation Technology Conference. Finally, a web replay of today’s call will be available on our site starting later this morning. Thanks for joining us. Operator, you may disconnect all lines.
Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.
