Shares of Polycom (NASDAQ:PLCM), a "unified collaborative communications" company -- better known as "videoconferencing" to you and me -- continued their slide last week. The rival to better-known telecom equipment makers like 3Com (NASDAQ:COMS), Avaya (NYSE:AV), and Cisco (NASDAQ:CSCO) ended the week down more than 6% after issuing disappointing Q3 guidance on Tuesday.

The bad
Polycom warned that Q3 revenue would likely come in somewhere between $235 million and $239 million. (Analysts had expected $5 million more than the top of that range.) Polycom also predicted that its GAAP earnings would range between $0.19 and $0.21 per share -- at worst, flat against last year's $0.19.

The good
Of course, the news wasn't all bad. On a pro forma basis (which excludes picky little details such as the cost of expensing stock options, in-process R&D write-offs, "acquisition-related costs," and charges for goodwill amortization, restructuring, and litigation expenses), Polycom expects its non-GAAP earnings to rise roughly 26% year over year. If Polycom hits its own revenue target, sales should climb roughly 37% from last year. Even better, Polycom reported that while these sales may be up only 1% or so compared with Q2, its backlog (an indicator of how sales will grow in the future) is up about 7% in the same period.

And the ugly
Behind the headline numbers, Polycom observed that growth in North America (the source of 57% of its revenue) has been "not as seasonally strong as is typical," while sales in Asia actually declined. It seems that only the "Europe, Middle East and Africa" and Latin America regions experienced decent growth in Q3. Considering that these regions, combined, account for only 25% of sales at Polycom, that's pretty ugly.

And a little more good
Continuing the pattern of ups and downs, here's some better news on the segments front. Polycom's strongest strong growth came in video solutions -- the company's most profitable segment. That said, I must say I'm wondering about Polycom's choice of terms when it calls video growth "strong." If sales will increase 37% this quarter, even as the more forgiving "pro forma" flavor of earnings increases only about 26%, I'd say that suggests some margin compression. Such a squeeze would seem to conflict Polycom's assertion that its strongest growth is coming in its most profitable business line.

Fiddle with the tuner there, will ya? Something doesn't sound right.

Tune in for more Polycom news and views with:

Polycom is a Motley Fool Rule Breakers recommendation. Try this market-beating publication free for 30 days.

Fool contributor Rich Smith does not own shares of any company named above. The Motley Fool's disclosure policy comes through loud and clear.