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Corning's Fiber Tangle

Fiber optics sales fall short, sending shares down 3%.

Updated from 4:23 p.m.

Corning

(GLW) - Get Corning Inc Report

sank 3% late Tuesday after the tech glassmaker said solid LCD volume was offset by weaker demand for fiber optic cable.

The Corning, N.Y., computer screen company posted adjusted earnings of $451 million, or 28 cents a share, for the third quarter. Analysts were looking for pro forma profit of 25 cents a share, according to Reuters Research.

Sales were $1.28 billion, up from the $1.26 billion in the second quarter and well above the $1.19 billion a year ago. Analysts, however were looking for revenue around $1.3 billion.

Gross margin remained at the 44% level in the quarter, slightly better than anticipated.

Total liquid crystal display, or LCD, glass volume -- including both Corning's wholly owned business and its joint venture with Samsung -- increased 13% sequentially and about 35% from year-ago levels. That is roughly in line with projections, but below the annual growth rate of 50% some fans were looking for.

Sales of fiber optic cable and equipment to telcos dropped 3% sequentially as

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worked through its inventory buildup from prior quarters, says Corning.

Looking ahead, Corning expects total LCD volume to grow 15% to 20% in the fourth quarter. For the full year, Corning says it is a little more confident about LCD volume growth.

"We are confident we will be at or slightly higher than 50%," said Kate Asbeck, Corning's vice president of finance, in an interview after the earnings release Tuesday.

Last month, Corning had lowered that target, saying volume growth would be somewhere in the range of 40% and 50%.

Corning's adjusted profit guidance calls for earnings per share to be somewhere between 26 cents and 29 cents, roughly in line with analysts' expectations.

Corning predicts fourth quarter sales will be about $1.33 billion, which is below the $1.36 billion the street was looking for.

Shares fell 64 cents to $22.50 after earlier being down twice as much.