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What happened 

Shares of First Solar, Inc. (FSLR -1.41%) fell as much as 18.9% on Thursday after the solar manufacturer reported third-quarter earnings. At 1:20 p.m. EDT, the stock was still down 17.2% on the day. 

So what

Revenue for the quarter was $688 million and net income was $154.1 million, or $1.49 per share. Revenue fell short of the $967 million expected by Wall Street analysts, but adjusted earnings per share of $1.22 easily topped the $0.69 estimate. 

While last quarter's results got some attention, they were overshadowed by a nearly $1 billion decline in 2016 revenue guidance to $2.8 billion to $2.9 billion. And bookings of just 1.6 GW this year don't match the 2.2 GW of solar panels that have gone out the door. Given the low pricing environment and weak bookings, there's concern about how bad 2017 is going to be for the solar industry. 

Now what

The truth is that we've known 2017 was going to be weak for many months now and we've also been aware that solar panel prices have dropped to around $0.40 per watt. What First Solar has to do is manage the short-term pressure until long-term market forces lead to stronger demand in 2018 and beyond. One move the company may be making is accelerating the Series 6 solar product, which will be more efficient and more cost competitive. Long term, I think First Solar is well positioned to benefit from the growth in the solar industry, but it'll probably be a rocky ride in the meantime.