Infinera Corp. (Nasdaq: INFN) shares have tanked by about one third this morning, on news that the company is entering a "period of network absorption."

That's the phrase CFO Ita Brennan used on yesterday's earnings call, when Infinera announced its fourth-quarter revenues would be between $115 million and $120 million, compared with an expected $132 million as tallied by Thomson. One key tip-off is the fact that bookings in September were weak, she said.

Infinera's shares were down $4.06 (33%) at $8.27 by late morning Tuesday.

Investors might be particularly disappointed because Infinera reported strong numbers for its third quarter, which ended Sept. 25: revenues of $130.1 million and net income of 4 cents per share.

It's well known that Infinera's numbers can be easily thrown off balance, because the company sells expensive equipment that fits into long-term cycles.

"With customers like Level 3 Communications Inc. (NYSE: LVLT), the cable operators, and some content providers having caught up with bandwidth requirements, customers are taking a pause while they grow into their recent network buildouts," writes analyst George Notter of Jefferies & Company Inc. , in a note published this morning.

This lumpiness, as people like to call it, works both ways; it's possible Infinera could bounce back abruptly. "I would be surprised if the lull lasted more than six months," CEO Thomas Fallon said yesterday.

Notter speculates that optical component shortages might have helped create a mini-boom in systems ordering.

Continuing that thought, it's conceivable that Infinera is being victimized by general industry conditions. Ciena Corp. (NYSE: CIEN) appears to have had weak September bookings as well, analyst Michael Genovese of Soleil Securities Group Inc. reports this morning. If that's the case, it could affect Ciena's fourth quarter, which ends in October and won't be reported until December.

Infinera did have some upbeat customer news to share, including the fact that Qwest Communications International Inc. (NYSE: Q) has begun using its gear in regional networks. Qwest was already using Infinera's DTN system in its national network.

— Craig Matsumoto, West Coast Editor, Light Reading