Back in November, Motley Fool Stock Advisor pick Daktronics (NASDAQ:DAKT) predicted that in its fiscal third quarter 2005, as its operating margins continued to deteriorate toward the 8% range, it would earn somewhere between $0.16 to $0.22. Yeah, um, scratch that.

Yesterday, the company warned that as a result of weaker-than-anticipated revenues, its earnings for the quarter will actually come in closer to $0.10 to $0.12 -- about 35% less than what Wall Street has been looking for. While revenues should still show a 14% increase over Q3 2004, they're not likely to exceed $51 million, and thus will fall about 10% short of the $53 million to $58 million previously thought likely. Also, Daktronics suffered an erosion of gross margins, which fell 2% short of the targeted 32%.

What all that means for profits is that, despite the 14% rise in revenues, per-share earnings will be down year on year in comparison with Q3 2004's $0.13.

If Wednesday's earnings warning had any silver lining, it was that the revenue shortfall at least did not arise from lost sales. Indeed, with none of the three companies listed by Yahoo! Finance as being Daktronics' primary competitors -- Digital Recorders (NASDAQ:TBUS), Trans-Industries (NASDAQ:TRNI), or Trans-Lux (AMEX:TLX) -- seeming to figure seriously in Daktronics' primary market of large-screen electronic displays for sports events, it's hard to see to whom the company could lose business. (There's Sony (NYSE:SNE), of course, which Tom Gardner cited when recommending Daktronics back in January 2004 as being Daktronics' only real competitor. But as Tom pointed out at that time, Daktronics' products have a technological lead over Sony.)

Rather, Daktronics attributed its revenue shortfall to various delays -- delays in receiving parts needed to do its work, and delays in booking orders. The company described the former as not "significant" and expressed confidence that the latter has already proven moot, because of a large number of orders being booked at the tail end of Q3 and into the beginning of Q4. If the orders that didn't come in during Q3 do appear in Q4, this might even make next quarter's numbers look better in comparison to both Q3 and fiscal Q4 2004.

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Fool contributor Rich Smith holds no position in any company mentioned in this article.