Thank you all for coming today. What do you think of the video? The last age, I like it. It's nice to see so many familiar faces here with us today. Welcome.
The Annual Meeting of Shareholders of Corning Incorporated will please come to order. I'm Wendell Weeks, Chairman of the Board of Directors, Chief Executive Officer and President. Seated to my left are Linda Jolly, Secretary of the Corporation and Ginger Lawrence, the Inspector of Election. Today's meeting is in 3 parts: the official business of the meeting my reflections on the state of the company and some brief concluding remarks. Following the meeting, we'll have a special presentation from Clark Kinlett, Executive Vice President of Corning Optical Communications.
You have the printed agenda for this meeting, but let me review the formal action that we will take. Ms. Jolly will report the number of shares being voted and confirm that the meeting has been properly called. I will introduce the Board of Directors. I'll call for a motion for the election of 14 directors.
I'll call for a motion to ratify the appointment of PricewaterhouseCoopers as Corning's independent registered public accounting for 2015. Next, I'll call for a motion for the advisory vote on executive compensation. Then I'll ask for a representative of the Holy Land Principles to present the shareholder proposal that appeared in the proxy statement. Finally, I'll call for a vote on all four motions. After this formal action is completed, I will discuss the state of your company.
Some of you may have questions that were not covered in my formal remarks. Company officers will be available right in the lobby immediately following the meeting to answer your questions or guide you to the best people to address your concerns. They'll be wearing white badges to help you identify. There will also be an opportunity to ask questions following my remarks. Now we will start the formal part of the meeting.
Just a note, any valid ballots handed in at today's meeting won't be included in this morning's preliminary vote totals, but they will of course be included in the official vote tally reflected in Corning's SEC filing. Madam Secretary, may we have your report on the representation of holders of stock here today?
Mr. Chairman, as of March 2, 2015, record date for this meeting, the company had 1,268,790,790 shares of common stock outstanding and the same number of shares entitled to vote. The Inspector of Election has determined that 1,100,000,001 12,953,009 114 shares outstanding and entitled to vote are represented in person or by proxy at this meeting. This is 88% of the shares entitled to vote and represents a quorum for purposes of this meeting.
As you heard, a quorum is present. May we now have a report on the proof of call and notice of this meeting? Mr. Chairman, this meeting is being held pursuant to
a notice mailed on March 17, 2015, to shareholders of record on March 2, 2015. A list of shareholders entitled to vote at this meeting is available for inspection.
Thank you very much. Please file the documents with the meeting records. It is not our practice to have the secretary read last year's meeting. However, if anyone wishes to examine last year's minutes, they should see Ms. Jolly right after the meeting.
I will now introduce the members of the Board of Directors and ask them to stand when I say their name. Please hold your applause until everyone has been introduced. Mr. Donald Blair, Executive Vice President and Chief Financial Officer of Nike Doctor. Stephanie Burns, Retired Chairman, President and Chief Executive Officer of Dow Corning Corporation Mr.
John Canning, Chairman of Madison Dearborn Partners our Lead Director, Mr. Richard Clark, Retired Chairman, President and Chief Executive Officer of Merck Mr. Robert Cummings, Vice Chairman of Investment Banking for JPMorgan Chase Mr. James Floss, Vice Chairman and Chief Financial Officer, Pointing Incorporated Ms. Deborah Henretta, Group President of E Business at Procter and Gamble Company Doctor.
Daniel Huntenlocher, Dean and Vice Provost at Cornell University's New York City Tech Campus Mr. Kurt Landrop, Retired President and Chief Executive Officer of Education Testing Service Mr. Kevin Martin, Counsel at Squires Patent Boggs LLP and Former Chairman of the Federal Communications Commission Doctor. Deborah Rehman, Executive Chairman of MetaMarkets Group Mr. Hansel Tookes, Chairman and Chief Executive Officer of Raytheon Aircraft Doctor.
Mark Wright, Chancellor and Professor of Chemistry at Washington University in St. Louis. And most of you know one of our former directors who is here today, Emil Hote, who also served as Chairman and CEO, we are honored to have him with us and grateful for his ongoing participation. The first business of the day is to elect each of the 14 directors to a 1 year term. I now call for nominations for directors.
Mr. Chairman, I move that the following be elected directors of the corporation to serve a 1 year term or until their successors have been elected: Donald Blair Stephanie Burns John Canning Richard Clark Robert Cummings James Floss Deborah Henretta, Daniel Huttenlacher, Kurt Landgraf, Kevin Martin, Deborah Reiman, Hansel Tookes, Wendell Weeks and Mark Reitman. Mr. Chairman, I second that resolution. Is there any discussion?
The second proposal calls for ratification of the Audit Committee's appointment of PricewaterhouseCoopers as Corning's independent registered public accounting firm for 2015. I will now entertain a motion and resolution for that ratification. Mr. Chairman, I am under the adoption of the following resolution. Resolve that the shareholders of the corporation ratify the Audit Committee's appointment of PricewaterhouseCoopers as the corporation's independent registered public accounting firm for the fiscal year ending December 31, 2015.
I second the motion. Is there any discussion? The 3rd proposal calls for an advisory vote of shareholders approving the corporation's executive compensation as disclosed in the proxy statement. I will now entertain a motion and resolution for that approval. Mr.
Chairman, I move adoption of the following resolution, resolved that on an advisory non binding basis, the total compensation paid to the company's named executive officers as disclosed in the proxy statement including the compensation discussion and analysis and the supporting tabular and related narrative disclosure on executive compensation is hereby approved. I second the motion. Is there any discussion? Now we have the shareholder proposal concerning the Holy Land Principles. This proposal will be presented by Father Sean McManus, a representative of the Holy Land Principles Inc, who may make a brief supporting statement.
Good morning, Mr. Chairman, ladies and gentlemen. I rise to move Resolution number 4 regarding the Holy Land Principles, a corporate code of conduct for American companies doing business in the Holy Land. The Holy Land Resolutions of the Holy Land Principles are pro Jewish, pro Palestinian and pro company. The principles do not call for quotas, reverse discrimination, divestment, the Israeli Palestinian issue.
The Holy Land principles only call for fair employment by American companies in the Holy Land. Irrespective of what Americans may think of the sad Palestinian Israeli issue, one thing is certain, all Americans expect an American company doing business there to practice fair employment. That's the only thing the Holy Land Principles ask for, fair employment. Now Corning tried to get the SEC to exclude this resolution. The SEC in its wisdom ruled in favor of the Holy Land Principles.
Therefore, all Americans can be assured that the Holy Land Principles are intrinsically valid, inherently fair and reasonable and in the best American tradition. Today is the 2nd time in history that an American company is being asked to vote on the Holy Land principles and therefore has some significance. Please vote for the Holy Land Principles. It's the American Way. Thank you.
God bless America.
Thank you, Father. Is there any discussion? Thank you for sharing your thoughts on this matter. I'd like to say a few words before we continue. The Board of Directors' position on the shareholder proposal is stated on Page 61 of the proxy statement.
But let me briefly explain. The Board believes that this proposal is unnecessary in light of the company's demonstrated commitment to diversity and nondiscrimination. Our equal employment policies clearly set forth the standards under which the company treats all employees and applicants for employment. Our code of conduct articulates the company's long standing policy of 0 tolerance for discrimination or harassment of any kind. Our operations in Israel are subject to the same global policies as all other Corning locations.
Thus, the Board of Directors recommended a vote against this proposal. Now it's time to review the voting procedures for the 4 pending motions. Under the corporation's bylaws and SEC rules, the election of 14 directors, the ratification of the independent registered public accounting firm, the advisory vote on executive compensation and the shareholder proposal will be voted by ballot. Most shareholders have already voted. If you previously voted by mail, Internet or telephone, there is no need for you to vote again today.
Any shareholder who waited and needs to vote now should use the ballot received at home, then raise your hand and an usher in a red coat will collect it. You can also obtain a ballot from an usher by raising your hand. So the ushers will collect any ballots and give them to the Inspector of Election at the end of the meeting to be included in the final vote count. I now ask the Inspector of Election to report the results to the meeting.
Mr. Chairman, I report that each of the 14 directors nominees was elected to the company's Board of Directors by a majority of votes cast. The majority of votes cast also were in favor of the ratification of the audit committee's appointment of PricewaterhouseCoopers, LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2015 and the compensation paid to the company's named executive officers as disclosed in the 2015 proxy statement. The shareholder proposal did not receive a majority of the votes cast. Thank you.
I declare that all 14 nominees for Director are elected. The appointment of PricewaterhouseCoopers as the company's independent registered public accounting firm for 2015 is ratified. The company's executive compensation program is approved and the holder proposal failed to receive a majority of the votes cast, all as indicated by the report of the Inspector of Election. As I said earlier, today's vote results are preliminary. Final detailed numbers will be filed with the SEC in a Form 8 ks in just a few days.
That concludes the formal partisan meeting. Now I'd like to take a moment to talk to you about how your company is doing. My remarks will include some forward looking statements and actual results may indeed differ materially. You can find detailed risk factors in our most recent 10 ks and also on Kornit's Web site. You should also be aware that we use certain non GAAP financial measures and performance indicators to assess Corning's financial and operating performance.
You can find a reconciliation between GAAP and non GAAP measures on Corning's Investor Relations website. Now it's my pleasure to report that Corning is financially healthy. Our businesses are growing and we are capturing exciting new opportunities to apply our unique expertise to solve tough technology challenges. I hope you all enjoyed the video at the beginning of the meeting. We wanted to show you how vital material science and specialty glass have become to our world and why we're so excited about Corning's future.
Today, I'll briefly summarize Corning's financial results and provide an update on our innovation programs and then address some questions that may be on your minds. So let's start with our financial performance. In 2014, core sales were more than $10,000,000,000 the highest in Corning's history. We also grew core earnings per share each quarter, generated strong free cash flow and maintained a healthy balance sheet. We're extremely pleased with those results and we're particularly excited about the story behind the numbers.
First, multiple businesses drove our growth. Display Technologies remains a revenue, profit and cash generation powerhouse for us. At the same time, our 4 other segments combined to deliver double digit sales and earnings growth. 2nd, we improved profitability not just through strong top line growth, but also through outstanding cost reductions. Our businesses increased manufacturing efficiencies, while our staff groups did a terrific job setting priorities and controlling spending.
We also exceeded our expectations for synergies from Corning Precision Materials. You may recall that Corning acquired full ownership of this company in January of 2014. Our original forecast called for $90,000,000 in synergies last year, but the integration is proceeding faster and better than we expected. We actually achieved more than $100,000,000 in synergies last year and we expect to continue capturing benefits sooner than our original plan. So 2014 was just an outstanding year and we're continuing the momentum in 2015.
On Tuesday, we announced strong first quarter results, including our 10th consecutive quarter of year over year earnings per share growth. Now we certainly come a long, long way since I addressed you in 2012. We said that we would restore earnings growth following the biggest decline in net income in Corning's history. And we have done just that. As Corning's performance improved, we have honored our commitment to return cash to shareholders.
Last December, Corning announced a 20% increase in the company's quarterly common stock dividend and a new $1,500,000,000 share repurchase program. These actions mark our 4th dividend increase and our 4th share repurchase program since October 2011. In that time, we have increased the dividend 140% and authorized the repurchase of $7,000,000,000 or approximately 12% of outstanding shares. And we remain committed to rewarding shareholders as the company meets its performance target. Now let's talk about the current year.
Our 2015 focus is to build on our momentum and growth. The primary way Porting grows is through global innovation. So I'd like to share a few examples of the latest innovations that we expect to drive growth this year and in the years ahead. Last November, we launched Corning Gorilla Glass 4. This new composition is up to twice as tough as competitive cover glasses and specifically formulated to address the problem that consumers care about most.
Can anyone guess what that is? Breakage? I'd go with breakage. That's what the data says. Now we put our glass through some pretty rigorous testing in our labs.
But here's a look at a test by independent third party of Gorilla Glass 4. Can we do a drop test?
So you can take the phone.
Yes, ready.
And drop it.
And there it is.
It does not fail.
Okay. So I'm going to do that in case it was magic. And there we go, a meter and it has not broken. And David, just for you, my high heel, I am dancing on it, going a little bit harder. As we send it back to you, I can't imagine not quite breaking Gorilla Glass 4 coming to a smartphone here.
Now I hope you don't subject your phones to that kind of abuse. Now device makers can take advantage of that strength that you just saw that damage resistance that you just saw in two way. They can make devices as thin as previous versions, but would dramatically improve drop performance or they can make their devices even thinner, while offering the same outstanding damage resistance as Gorilla Glass 3. And we continue to innovate for the cover glass market. We have a glass in development right now that will feature the legendary toughness of Gorilla, while approaching the scratch resistance of Sapphire to the person who thought the number one problem was scratch.
We're working on it. So stay tuned. Coming to your smartphone soon. In optical communications, we're delivering on our promise of always on connections by rolling out 1 wireless to more locations. Our product helped make Texas A&M University's Kyle Field one of the most connected stadiums in college football.
But we've also installed the technology much closer to home, including the new Corning Hospital and right here at the Museum in the new contemporary art and design wing. We're also continuing Corning's long track record of making air cleaner. Last year, I told you that we were developing a technology to address the problem of cold start emissions. Now those are the emissions that occur in the very first 30 seconds of starting an engine. And they're actually responsible for approximately 70% of a car's total emissions.
Now that's because it takes a while for your catalytic converter to heat up and do its job. Now in January, we officially launched our new FLAURA substrate and announced Honda as our first customer. Here's a quick look at how the technology works. So our product is on the left. You can see that it heats up faster.
That means the catalytic reaction begins sooner and the engine produces fewer emissions. Our product improved fuel efficiency and can also lower overall systems cost by reducing the amount of precious metals that our customers need to use. So you can see that we continue to innovate in today's businesses. Now we also innovate to create entirely new businesses. Gorilla Glass Broad Automotive is a terrific example.
Car makers are gearing up to meet tougher fuel efficiency standards going into effect around the globe. They need materials that help them reduce weight and improve fuel economy without sacrificing strength, safety or aesthetics. Because Gorilla Glass is 5 times stronger than traditional glass, it enables windshields that are at least 25% thinner and weigh 1 third less than conventional windshields. And lower weight means better fuel economy. Those are just a few small portion of the long list of innovations in our new product portfolio.
Opportunities in multiple markets. Now I'd like to cover some topics that may be on your mind. We regularly engage with shareholders to understand questions and concerns. So today, I'll address some of the questions that come up most frequently. 1st, why does Corning maintain such a diverse business portfolio?
Or some people ask more explicitly, why don't you sell this or that business? Now this is not a new question for us. In fact, we probably received this question most often during the late 1990s and the early 2000s, when we were encouraged by many investors and technology pundits to shed most of our business segments and become a telecommunications focused company. Does anyone recall what happened to the telecom industry in 2,002? Show of hands, anybody remember?
I certainly remember. Now I know hindsight is 2020. But fortunately, we didn't follow that advice. Our commitment to Corning's other business segments, particularly Display Technologies, drove our recovery following the telecom crash and allowed us to create a bigger, stronger company. Today, Corning's business diversity remains a key source of our strength.
We saw more evidence of that last year. Market growth in Specialty Materials and Life Sciences was not as strong as we originally expected, But we exceeded expectations in Display, Optical Communications and Environmental Technologies, which led to outstanding performance overall. At any given time, there may be disruptions in 1 or 2 of our markets. But the strength of our other businesses helps to mitigate that volatility. There's a second advantage to our business diversity.
Our deep customer relationships make it possible for us to capture adjacent opportunities faster. Gorilla Glass for Automotive is a perfect example. We're leveraging our long standing relationships in the automotive industry to create a brand new market opportunity for our specialty glass to come alongside our already strong position in the Air Emissions Control business. Another common question is why does Corning spend so much on research, development and engineering? Over the past 3 years, Corning has spent an average of 9% of sales on RD and E.
Now that's about twice as much as our peers. So what do we get for that investment? First, we get a distinctive set of capabilities. Corning has deep and broad sets of skills that uniquely qualify us to solve tough problems. Our expertise in specialty glass, ceramics and optical physics is quite simply unparalleled.
And these capabilities are becoming more and more relevant to a broad range of industries. 2nd, our capabilities and our track record make us a compelling partner and allow us to earn the trust of our customers. That leads to long standing relationships and opportunities for future collaboration. Finally, we use our expertise in our deep customer insights to develop an advantage set of products that command premium prices as well as processes that allow us to be the most efficient producer. But let's cut to the chase.
What's the return on investment? To answer this question, it's helpful to examine relative performance. As I noted earlier, we spend an average of 9% of sales on RD and E, while our peers spend about 4%. Under the peer model, we would have spent $900,000,000 on RD and E in the past 3 years and delivered about $1,700,000,000 in operating profit. Instead, we spent $2,000,000,000 but delivered more than $4,000,000,000 in operating profit.
So our extra $1,000,000,000 investment returned an additional $2,600,000,000 in operating profit in the last 3 years. That is a huge premium and that's why our commitment to innovation is unwavering. That leads to another popular question. What's our next big thing? Now I used to answer this question by pointing out that I love all my children equally.
And I would never choose between them. But more importantly, I just don't think this question reflects the reality of Corning today. Historically, there has been a primary business driving the company's growth until a new primary business takes over. But today, multiple businesses are driving growth. And as you saw from the examples I shared earlier, we unlocked new opportunities by innovating for both existing and future businesses.
Now it's true that we always have innovations in our portfolio with the potential for explosive growth. For example, we're really excited about the opportunity for Gorilla Glass Extensions. We're also pursuing an opportunity in Life Sciences that it is just still a little too early to talk about, but could become a major business for us. But while our innovations always have breakout potential, our focus is on capturing multiple opportunities. So instead of what's the next big thing, I think the key questions have become are Corning's capabilities relevant?
Are we serving industries that are growing? Are we participating in the right trends? Are we working with the right customers? And I believe the answer to all those questions is an emphatic yes. The final question that I want to cover before closing is why do we invest so much in our communities?
Now that may seem like an odd question to some of the folks in this room. I recognize a lot of the faces. And I know I'm surrounded by neighbors who are community minded. But we do periodically get this question from people who argue that the funds we invest in our communities should be going to our bottom line. 1st, it should be obvious from our performance that we are very focused on Corning's bottom line and we're delivering on that front.
We're also committed to delivering value to our shareholders and I believe we've demonstrated that with the numerous dividend increases and share repurchase programs over the past few years. But we are also committed to being good corporate citizens. As part of that commitment, we invest to make our communities better places to live and to work. For example, here in Corning, we support a broad range of initiatives focused on education, cultural programs, health and human services as well as economic development. We could not be more proud of our long standing support for the Corning Museum of Glass and the funding we provided for this beautiful building.
We also donated $2,000,000 last year to Corning Community College to renovate the library in the commons area. We've made land available to the Corning Hospital And we're working with our community partners to develop the old site at Denison Parkway. And we continue to work with our peers in the community to make infrastructure improvements and revitalize Market Street. We engage in similar initiatives all across the globe and our investment goes way beyond our financial commitment. Our people are also extremely generous with their time and their talent.
Last year alone, our employees helped build homes for low income families. They worked at local soup kitchens in Hickory, North Carolina. They delivered gifts to struggling families to make the holidays a little bit brighter for children in Reynosa, Mexico. They volunteered at organizations that provide life saving medical care for orphans in Shanghai, China. And they volunteer every month to clean the streets in Asong, Korea.
I can't possibly list every example, but when you look at all the ways that our people give, it is stunning. I'm proud to be part of a company that makes a positive difference people's lives and part of a community where people support each other. I'll end my remarks there, but I hope I've given you a better understanding of Corning's financial health, our growth opportunities and what makes this company so special. This is a company that is built to survive difficult times. This is a company that continually produces innovation that enhance people's lives.
This is a company that rewards its shareholders. But most important, this is a company that lives its values and makes a real difference in the world. We are committed to earning your confidence with our performance and your trust with our actions. Thank you for being on this journey with us. Now let's return to the final business of the meeting.
I hope that my remarks address some of the topics on your mind. As I noted earlier, company officers will be available to answer questions in the lobby following Clark Kinlan's presentation. However, if you are unable to stay, you can ask your question now. Is there any further business to come before this meeting? If not, I will entertain a motion for adjournment.
I so move. 2nd. All in favor say aye. So ordered, I declare this meeting adjourned. Thank you again for joining us today.
The directors and I need to leave now to take care of additional business, but please stay seated for Clark Kinlin's presentation. I hope you'll also take advantage of your time here at the museum to visit the new contemporary wing. We're so fortunate to have this international treasure right here in our own backyard. And I'm sure you will enjoy this beautiful, beautiful new space. Now please welcome Clark Kinland, who will discuss how Corning is enabling the glass age through our leadership in optical communications.
Executive Vice President, Corning Optical Communications, Clark Kinlin.
Well, thank you, Wendell, and welcome, everyone. It's my privilege to be with you today. I've worked for Corning for more than 33 years, during which time I've held a lot of positions from helping to build Corning's Telecom business in the early days to leading commercial operations in our consumer business to building Corning's operations in China. Today, I run Corning Optical Communications, which is headquartered in North Carolina. But I'm always happy to be back here in Corning, New York, especially on a lovely April day.
That's not only because my lovely wife hails from here, but I've also called Corning home for over 30 years. Before I begin my presentation, I want to acknowledge someone who's with us today, who has been an important leader in the optical communications business. It's customary for us to acknowledge the scientists and engineers who invented this wonderful material that we continue to build on today, but we often don't recognize the leaders who made it possible. In 1981, Fortune Magazine ran an article that was entitled something to the effect of, if Corning Glass it's called Corning Glass now by
the way, if Corning Glass
is so smart, why isn't it rich? And the thesis of the article was why the then Chairman, Amory Houghton, Jr. Was betting the company on its new technology called optical waveguides. I don't know if Hemo is still with us this morning, but if he is, I want to say Hemo on behalf of the 17,000 Corning Optical of Communications employees. Thank you.
So I'm pleased to be here today to give you a look inside Corning Optical Communications, one of our most important growth businesses. It's a very exciting time for Corning. As you know, rapidly changing technology is affecting the way we live, work and manage our lives and this is causing the demand for data to grow. This massive amount of data sharing, manipulation and storage is stressing the edges of our networks, which are closest to consumers. Optical solutions are the best technology for solving network challenges and we Corning Optical Communications are a leader in this space.
And we believe that our innovative solutions and operations capabilities will continue to deliver profitable growth for Corning. But before I begin, as is customary, I need to meet our legal obligations by reminding you again that this presentation contains some forward looking statements. We base the statements on our current expectations, but of course actual results may differ from those I'll share with you in a moment. So let's take a look initially at some of the trends that are driving this demand for bandwidth.
Now whether you are in business,
you're active in social media or simply trying to keep up with the millennials in your life, you know that we live in a connected world. If you were one of the now 31,000,000 people who watched the Corning Day Made of Glass video, you also saw people connecting by a myriad number of new devices. Considering the fact that I can't reach any of my kids unless it's by text, video or chat, this does not come as a surprise to me. But connected devices are no longer just televisions, computers, phones and tablets. They include everything from smart thermostats to network enabled parking meters.
Even your average car now has the computing power of 20 personal computers, helping it to talk to your mechanic to optimize maintenance or to other cars on the road to improve safety. All of these things, all of these connected devices make up what is called the Internet of Things. And by 2020, there'll be more $50,000,000,000 of them. It's an exciting time to be alive as the way we connect with the world around us evolves right before our eyes. Think about a few statistics.
Cisco predicts that the number of on demand movies watched in living rooms around the globe could fill as many as 6,000,000,000 DVDs per month in 2018. And remember those connected cars eventually fully automated driverless vehicles could generate as much as 1 gigabit per second. The magnitude of data being created and shared is driving demand for more and more bandwidth and usage has doubled every 2 years. In fact, the amount of bandwidth needed to keep pace with the world's appetite for data will grow more than 20% per year through 2018. This will challenge network operators' ability to deliver the capacity required to make all these connected devices work.
This is something that all of us take for granted. We want bandwidth to be like turning on the faucet of a glass of water, instant access as much as we want when we want it. But all networks are stressed, especially at the edges. Global demand for bandwidth is increasing faster than most can keep up with, especially in places like sports stadiums, apartment buildings and homes, data centers and office buildings. For consumers, this means dropped connections, buffering videos, which are really frustrating.
It can also delay the transmission of vital information. For example, in stock market transactions where a 1 millisecond advantage can be worth $100,000,000 per year. If you look up the utility poles in an underground dock, this happens to be Hong Kong, a really advanced technology plant. Sincerely, one of
the best in the
world. You'll find a jungle of cables and hardware up there desperately trying to keep pace with the bandwidth demands of
the world. And some of you
have heard me say this in past shareholders' meetings, optical is the best platform for solving this cyber traffic jam. Optical solutions win against copper for long distance transmission or when high bandwidth is needed over shorter distances. Imagine this, one optical fiber can transmit the entire collection of the U. S. Library of Congress from Florida to London in less than 25 seconds.
Fiber is also 3 times stronger than steel and more durable than copper, yet light and flexible. So when designed into comprehensive optical solutions, it can be deployed in hard to reach places and in really harsh environments, like on data centers and on top of communication towers. As you saw in the clips from my opening video, Corning envisions a very exciting future, but it is not possible without the unmatched speed, capacity and flexibility of networks enabled by optical fiber and Corning Technology is leading the way. Optical Communications or COC as we call it is one of the largest business groups in Corning, more than 30 locations and 17,000 employees worldwide. In 2014, we delivered a record $2,600,000,000 in sales and $231,000,000 in core earnings.
In aggregate, we have driven annual double digit sales and profit growth over the past 4 years, faster than the market and well above our goal of 2 times communications industry CapEx. We are a world leader in optical physics with the broadest intellectual property portfolio including more than 2,500 optical fiber, cable and hardware patents. We have a global sales organization with access that is in deep relationships with key customers that give us unique insight into the world's toughest network problems. Our manufacturing facilities are located across 5 continents and include locations in China, the world's largest fiber market. And our proprietary knowledge and lowest cost manufacturing allow us to deliver a steady stream of innovative solutions for every segment of the communications industry, while delivering strong profitable growth.
In fact, our optical solutions have led the industry since Corning scientists created the first low loss fiber in 1970 and we were there at the birth of the Internet. Today, we continue to grow fiber's capacity and capability while lowering costs. For instance, since we invented optical fiber 45 years ago, we have found ways to reduce signal loss by 100 times and we've dropped fiber manufacturing costs by half in just the last decade. From the desktop to the ocean, Corning is the only fiber manufacturer with products to meet the unique needs and requirements of virtually every network application. But network operators require more than just fiber to deliver the speed, capacity and cost they need.
They actually need a broad range of optical solutions, including cable, connectors, components and hardware. Corning is a world leading provider in each of these segments, supplying thousands of products to customers in more than 100 countries around the globe. What further differentiates us from our competition
is the fact that we have
a very broad range of intellectual property and distinct capabilities in fiber cable, connectivity and network design. We combine these key components into solutions that enable everything from the public networks that supply your Internet, cable TV and phone service to private networks that hospitals use for example to manage their records. Through innovative optical solutions, we ensure that operators around the world can harness the benefit of fiber cost effectively. I'd like to now review how we're innovating in the key network segments to bring value to our customers and to our investors. As you can imagine, networks between continents and across countries very expensive.
Corning's SMF-twenty 8 ultra low loss and VASCADE ultra low loss fibers address these challenges head on. While older networks needed power hungry equipment to maintain signal integrity, increasing network costs, our ultra low loss fibers are designed to transmit information 35% farther than standard fibers, reducing the need for expensive equipment. When it comes to bandwidth, optical solutions reign supreme. That's why more than 99% of all international data is carried on optical fiber. But Corning isn't stopping there.
We are helping network operators push connections further and faster into more points around the globe with the help of our next gen submarine fibers that enable transmission of 10 times more data than was possible just a few years ago. In fact, we recently demonstrated record setting transmissions using our VasCADE submarine fiber transmitting 100 gigabits per second over more than 3 75 miles with no repeaters between the endpoints. That's the equivalent of sending 40,000 e mails between Key West and Cancun on a single wavelength flight. Within the Fiber to the Home segment, emphasis shifts beyond distance and data rate. Here, we're also solving cost and speed of deployment challenges with a unique solution we call FlexNet, essentially a plug and play system.
In the past, network installers had to perform really delicate surgery on cables to manually splice in fibers. FlexSnap uses optical cable with pre installed access points, so the technicians can simply plug into the network in a matter of seconds reducing installation time. For the past 10 years, the cost of installing fiber to the home has dropped more than 50% due in large part to our innovations reducing the need for field splicing. So why do you care? What's the benefit for consumers?
Well, some providers are already offering 1 gigabit per second service for about $70 a month. Many of you may be paying that much for only 10 megabits per second. So imagine getting 100 times faster service for about the same price. But not all providers are taking fiber all the way home just yet. So Corning is working on solutions that bring it to the curve and leverage the existing copper for the last 200 feet.
This helps us to drive fiber deeper into the network today and establishes a strong fiber foundation for easy migration to an all optical future. In the data center, operators are losing sleep over limited space for equipment, heat from densely packed components and expenses from recurring upgrades and migrations to faster network speeds. So Corning worked with operators and installers to develop the Edge platform. Edge maximizes every inch of data center real estate using optical cables so light and so compact that just one cable, one optical cable can replace as many as 72 copper cans. Plus fiber is green.
Optical solutions consume about 1 fourth of the power per port of copper, saving money and reducing heat for our customers, while contributing to the reduction of overall carbon emissions for a smaller impact on the environment. No other solution can provide more bandwidth than simple migration to 100 gigabit data transmission speeds. But in keeping with the theme of Wendell's comments Based on input Based on input from our customers, we recently developed an entirely new Edge platform called Edge 8. Edge 8 provides the most flexible optical cabling system for transmission speeds up to a whopping 400 gigabits and it is the most cost effective, future ready data center solution available today. Finally, the segment most affected by data consumption is wireless, where come 2018, global device traffic will exceed wired traffic.
There are 2 fundamental problems facing the wireless industry, namely coverage and capacity. 1st, more than 80% of the data that we use is consumed indoors, but it's very difficult to deliver high quality wireless coverage inside buildings. 2nd, bandwidth demand is growing faster than network owners' ability to keep up with it. We've all been at that sporting event where our phones register 5 bars of service and still there's no capacity to send a photo to the friends and family at home. To stay ahead of these challenges, Corning launched the 1 wireless platform, the 1st all optical solution to harness the virtually unlimited bandwidth of fiber to enable unparalleled services.
The one platform can be deployed in half the time. It uses half space of the multiple systems needed to do all that one can do today. And one can save the owner up to 50% on upgrades over time. It is the 1st wireless solution to converge nearly every wireless connectivity need into 1 single unified infrastructure that delivers both coverage and capacity
at up to half the cost of alternatives.
As Wendell discussed in his opening, last year we installed one platform at Kyle Field, home of the Texas A and M Aggies. It is one of the largest college football stadiums in the country, seating for more than 100,000 fans, all calling, texting and tweeting about being at the big game. And M was running multiple networks, 1 for cellular, 1 for Wi Fi and they were still ripping and replacing networks every few years to keep up with the technology. They came to Corning looking to become the smartest damn stadium in the country. Using 1, they were able to redesign their network to converge everything onto a single platform, supporting 100,000 concurrent 2 megabit per second connections, enough to upload 100,000 photos to social media every second.
Pretty awesome. Today, the Aggies are amongst the most connected fans anywhere with coverage for all 4 leading carriers and Wi Fi. Plus the one platform enables multiple point of sale systems, a network of more than 1,000 connected television screens and anything else they can possibly think of, all for half of what they were originally going to spend. As you've heard today, 45 years ago, Corning scientists launched a revolution with the invention of low loss optical fiber. And since then, we've added a steady stream of innovative optical solutions that solve our customers' speed, capacity and cost challenges.
But our manufacturing process innovations have been just as significant. Obviously, I can't share a lot of detail for competitive reasons, but we are continually evolving product design, incorporating better and less expensive materials, while in manufacturing technologies that deliver increased capacity at lower cost. On average, Optical Communications executes over 300 innovation based cost reduction initiatives per year, spanning all aspects of our global operation. These changes have resulted in approximately $100,000,000 in cost reduction per year in each of the last 3 years. Our manufacturing innovation and operations scale coupled with a steady stream of new optical solutions, has resulted in a track record of profitable growth for Corning.
As I mentioned earlier, we have driven annual double digit sales and profit growth over each of the last 4 years, faster than the market far above our goal of 2 times telecom industry CapEx. In 2014 alone, our sales grew 14% and profit 18%. We've also strengthened our hand by acquiring our market access and leverage our operations capability. In the last 6 months, we've executed 3 important acquisitions that enhance our capabilities and provide access to the Edge segment, including the acquisition of PR Manufacturing, a leading provider of connectivity solutions for the hyperscale data center market. We acquired Samsung's fiber optic business, providing important access to customers in Korea, Southeast Asia and Latin America.
And recently, we acquired IV Wave, an industry leader in design software for in building wireless networks. As a result, with acquisitions, we expect double digit sales growth and profit growth in 2016. So thank you for allowing me to share little bit more about Corning Optical Communications. In summary, here's what I hope you take away from today's presentation. First, the demand for data continues to grow unabated.
This wave of growth is stressing the edges of the network closest to consumers and it's affecting our user experience. Optical solutions are the best technology for solving network challenges and Corning Optical Communications is a leader in this space. And finally, our innovative solutions and operations capability will result in profitable growth for Corning. As I said, it's an exciting time for Corning and we will continue to win by innovating new solutions to solve the world's toughest network problems. Thank you.
Now I invite you all to join me and my management colleagues in the lobby to address any questions about the company that you may have. I also think most of you know we will not be holding our usual luncheon outside. Instead, we're providing gift cards to everyone you can use at a variety of locations on Market Street in the Gaffer District. It's our way of extending our thanks to the community we live in, supporting our local businesses, which is really an important part of who we are. And I have it on good authority that they will appreciate seeing you.
So