Corning Inc said on Monday it expects consumer appetite for flat-screen televisions to be robust through 2010, fueling demand for its specialty glass, and hopes that market prices will mark only mild declines.

Corning posted stronger than expected third-quarter results, sparked by global growth in demand for liquid crystal display TVs, as well as improved Telecommunications sales, particularly in China.

Citing signs that corporate spending may be rebounding -- after a prolonged period of sluggishness due to the recession -- Corning also forecast higher sales of computer notebooks and desktop monitors.

We have heard comments that corporations are raising IT (information technology) spending a little, Corning Chief Financial Officer Jim Flaws told Reuters in an interview.

Demand should be strong next year. Overall, the company feels global unit sales of LCD televisions in 2010 could reach 156 million, up 20 percent over 2009, and it also sees computer notebook sales up 20 percent.

That would push worldwide glass volume to 2.7 billion square feet in 2010, a 15 percent increase.

If these retail forecasts are correct and glass supply chain inventories remain manageable, as we expect, then next year could see very robust gains in worldwide glass volume, Flaws said in a statement.

Corning, the largest maker of glass for liquid crystal display screens, said third-quarter net income fell to $643 million, or 41 cents a share, from $768 million, or 49 cents a share, a year earlier.

Excluding special items, profit was 42 cents a share, beating analysts' view of 39 cents a share, according to Thomson Reuters I/B/E/S.

Revenue fell 5 percent to $1.48 billion, but was greater than analysts' view of $1.42 billion.

The company said its display technologies combined glass volume increased 4 percent from the second quarter.

The results overshadowed operational problems at two Corning plants in recent months, involving a power disruption in Taiwan and an earthquake in Japan.

Although a portion of our glass production at the Taichung facility has been impacted by a power disruption, we remain confident that the strong performance in our display business over the last two quarters will continue in the fourth quarter of this year, Flaws said in a news release.

Many Wall Street analysts cheered the long-term outlook. However, Ticonderoga Securities analyst Brian White offered a more sobering thought on the current period, in which the outages will hurt glass output and returns from Corning's other units -- such as telecommunications -- could soften.

With challenges returning to the LCD panel makers more recently, combined with a muted LCD glass outlook from Corning and a weak outlook from the remainder of its businesses, we believe the stock could tread water in the coming months, White said in a note to clients.

Corning said it expects fourth-quarter glass volume in its wholly owned display business to be flat to down slightly from the third quarter.

It expects some panel makers who buy Corning's glass to slow down their plants later in the quarter. Lower utilization often means fewer panels are produced, shrinking the chances of a supply glut that could depress prices.

Glass pricing was flat in the third quarter and is expected to be about the same in the fourth period. On a conference call with analysts, Flaws declined to pinpoint pricing estimates for 2010, but said he hopes that we have moderate price declines year in, year out.

Corning shares were up about 1 percent earlier, but slipped to $15.50, a decline of about 1 percent, on the New York Stock Exchange on Monday afternoon.

(Reporting by Franklin Paul, editing by Gerald E. McCormick and Matthew Lewis)

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