But the company said it expects to ship only 3 percent to 10 percent more of the specialty glass in the fourth quarter. In the third quarter, shipments grew 22 percent.
Sales for the third quarter totaled $1.18 billion - at the high end of the company's earlier prediction. Net income was 13 cents a share, or $203 million.
Before special charges totaling $202 million, Corning Inc. earned 26 cents a share in the quarter, 5 cents more than the Wall Street consensus of 21 cents. The special charges were related to telecom restructuring, asbestos litigation and a writedown of the value of Corning's investment in struggling conventional television maker Samsung Corning Co. Ltd.
Two cents of the quarter's earnings resulted from an adjustment in previous federal income tax payments following an audit, said Katherine A. Asbeck, senior vice president of finance.
"We are very pleased with Corning's overall performance in the third quarter," said Wendell P. Weeks, president and chief executive officer.
Investors sent Corning Inc. stock down sharply Wednesday on the New York Stock Exchange, where it closed at $17.96, down 59 cents, or 3.1 percent. In after hours trading, the stock fell to $17.79.
Sales in the third quarter were up 4 percent from the second quarter and 18 percent over last year's third quarter. Net income for the first nine months of the year totaled $617 million, or 41 cents per share.
Asbeck said the company expects the coming slowdown in growth of liquid crystal display glass shipments to be a quarterly fluctuation, not a long-term trend. The glass is used in computer and television displays.
Any slowdown in the liquid crystal display market is significant for Corning Inc. because the company's display technologies segment is the only one of its four major businesses that is making money.
Weeks said the expected fourth-quarter slowdown is related to two factors - fewer new manufacturing plants coming on line and some emerging seasonality in the market.
In the Display Technologies segment, third-quarter sales were $489 million, up from $295 million in the second quarter. Glass volume was up 78 percent from the same quarter last year.
For the first nine months of the year, Display Technologies sales totaled $1.224 billion, up from $767 million in the same period last year.
In the third quarter, Corning's telecommunications business lost $30 million, its environmental technologies business lost $5 million and its life sciences business lost $7 million.
Asbeck said heavy capital investment in both the environmental technologies and life sciences businesses account for those losses. She said the telecom losses are linked to restructuring charges.
"Clearly, we'd like to make a lot more money in all our businesses," she said.
Telecommunications, Corning Inc.'s biggest business until the 2001 crash, saw third-quarter revenues decline to $398 million from $412 million in the second quarter. Asbeck said fourth quarter telecom sales are expected to decline another 4 percent to 7 percent because of seasonal factors.
Francis J. Moss, president of Soaring Capital Management in Elmira, said investors weren't pleased with the shortfall in the telecom unit.
"Corning's glass looks half empty," Moss said.
Demand was lower than expected for the telecom equipment used to make optical fiber connections to homes and businesses, Moss said.
Shares of Corning Inc. are expected to trade in the $17 to $20 range until it's clear how sales of liquid crystal televisions shape up for the rest of the year, Moss predicted.
Fourth quarter sales in the environmental technologies and life sciences businesses are expected to be flat, Corning Inc. said.
The company ended the third quarter with $2.4 billion in cash and short-term investments.
"We reached a new financial milestone in the third quarter as our cash and short-term investments exceeded our total debt by more than $300 million," said James B. Flaws, Corning's chief financial officer.
Asked how long it had been since that had occurred, Asbeck said: "A long time."
Corning Inc. said it expects fourth quarter sales to total $1.18 billion to $1.24 billion. Earnings per share before special charges are expected in the range of 21 cents to 23 cents.