Corning Sees Glass Half Improved

Corning raises its second-quarter forecast for liquid crystal display sales.
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Less than two weeks after

Corning

(GLW) - Get Report

said it was

on track

with its liquid crystal display glass target, the company raised its second-quarter forecast Thursday.

The Corning, N.Y.-based glassmaker says the "supply chain is in full recovery mode" and that LCD glass volume will grow "more than 75% sequentially," which is up from the prior estimate of 50%.

Corning got

hammered

last year as glass supplies exceeded demand and prices fell further than it expected. The company had to shut down some of its glass production and cut 3,500 or 13% of its staff to try to rebalance its costs with fallen revenue levels.

Corning makes the thin sheets of LCD glass that go into flat panels for big TVs and computer monitors. The falling economy shattered TV and PC sales last year, creating a backlog of inventory.

But Corning says that oversupply has reversed and that panel makers have ordered more glass.

"The LCD supply chain continues to replenish; glass supply and demand is very tight right now, much stronger than we anticipated," CEO Wendell Weeks said in a press release. Weeks added that he thought strong demand would "likely last through the end of the third quarter."

Earlier this month, Corning reiterated its 18% LCD volume growth target for the year. Despite the surge in orders in the second quarter, the company did not change that target Thursday.

The company says it has taken a "conservative approach" as it restarts some of its idled glass production tanks. Too much production, especially in a time of recession, could quickly lead to yet another cycle of oversupply.

Corning shares were up 40 cents, or 3%, to $15.02 in premarket trading Thursday.