But as I visit our operations throughout the world, I’m continually encouraged, delighted — and yes, humbled —byhowloyalourpeople have remained to this com- pany. Over and over, I find people totally committed to discovering remarkable new properties in the materials we know so well … to serving our customers with flawless manufacturing processes … and to supporting every aspect of our operations so we can continue to meet our goals and thrive once again. 

They are committed because they, too, believe in this com- pany’s ability to survive times of massive change and remain true to our Values. Our recov- ery as a company is a matter of personal pride to them. 

## Looking forward 

As we look out to the year ahead and beyond, our priori- ties remain consistent. We will protect our financial health; we will improve prof- itability; and we will invest in our future. Within this framework, we will continue to chart specific goals and milestones in support of sustainable, long-term busi- ness performance. We have developed a strategy for this performance — a strategy in three parts: 

## ■ Growth through innovation 

First, we will grow the company, and we will fuel that growth with global inno- vation. Some companies grow mainly by acquisition or mergers, but Corning grows through innovation — and that belief is deeply ingrained in our culture. 

We’ve enjoyed consistent successes when we’ve taken that approach, and today, our products for these growth markets — LCD, diesel, and FTTx — are just a few exam- ples of that. Our products have always been — and always will be — keystone components that make larger systems work. Today, we’ve strategically positioned our- selves to commercialize different innovations in a variety of long-term markets, and we intend to continue that approach in aggressively pursuing multiple high-value opportunities. 

This approach to innovation is resource-intensive. While we keep focused on near-term growth opportunities, we also continue to invest in new technologies, and it can some- 

times take a dozen years or more to fully commercialize a product. In addition, our brand of innovation — solving extremely complex materials problems for growing markets — is just plain difficult to do. Accordingly, our fixed costs can be high. 

That’s why we are so commit- ted to developing technologies that add significant value. Those opportunities tend to be in markets that respond to basic human needs — like communications, the environ- ment, and health care. And because the growth potential for these markets tends to be strong, we can offset our higher fixed costs with rev- enues reflecting our leadership position. 

## ■ Balance 

Second, while growing globally through innovation, we will work to achieve balance and stability — knowing that this notion is often at odds with growth. 

After the telecommunications downturn, many people ques- tioned the rapid growth of our telecom segment — which at one point had represented more than 70 percent of our revenues. Our response has been consistent: We will 

always pursue attractive markets where our strength in innovation can make a sig- nificant difference — and we will let the markets determine the level of our involvement at any given time. 

In other words, we won’t seek to balance the outputs of our investments — that’s what the markets will deter- mine. We will, however, balance the inputs , carefully controlling how we choose to pursue certain technologies and the investments we make as we develop new market opportunities. 

Being constantly mindful of achieving this balance will help us mitigate the inherent cycles of a high-technology business, and maintain a level of stability as we continue to grow. While we know we will always go through cycles, we also know that avoiding extreme, ongoing volatility will help us move much more smoothly toward another 150 years of innova- tion and independence. We are encouraged that we are seeing initial success in three markets — LCD, diesel substrates and FTTx. This 

