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What: Shares of optical networking equipment maker Infinera (Nasdaq: INFN) sold off today, down by as much as 11%, after the company reported third-quarter earnings last night.

So what: Revenue for the quarter plunged by 20% to $104 million, which resulted in an adjusted net loss of $0.09 per share, compared with a $0.11 per share loss last year. Gross margin shrank to 39% from 50% in the prior year's third quarter.

Now what: Forward-looking guidance is also disappointing investors. The company expects a fourth-quarter adjusted loss of $0.08 to $0.12 per share on revenue in the range of $100 million to $110 million. This forecast is lower than the $0.07-per-share loss and $109.4 million in revenue that analysts were looking for. Investors are dumping the shares on the gloomy report, and Citi Investment Research analyst Kevin Dennean believes 2012 will be a transitional year as the company increases marketing and performance expenses.

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Fool contributor Evan Niu holds no position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns, and Motley Fool newsletter services have recommended buying, shares of Infinera. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.