Cosmetic and aesthetic laser maker Candela (NASDAQ:CLZR) is set to announce earnings next week. With analysts expecting a 25% increase in revenues and a 33% jump in earnings this quarter, it remains to be seen whether the manufacturer of lasers that smooth wrinkles, zap varicose veins, and remove tattoos will burn investors again. The company's recent history hasn't been too encouraging.

After promising "white hot" sales of its premier GentleYAG laser last year, the company disappointed investors with progressively declining earnings. Then, last quarter it decided that lasers were no longer the technology to carry the company into the future, but rather intense pulsed light technology -- an area where competitors like Palomar Medical Technologies (NASDAQ:PMTI) have already been leading -- and jumped in with the Ellipse I2PL device, licensed from Danish Dermatologic Development.

Candela's revenues and earnings should be growing. Laser and light-based cosmetic and aesthetic treatments are estimated to be a $3.3 billion market, up from $2.2 billion in 2002, with more than 4.4 million procedures performed this year. Moreover, medical practitioners no longer need to be specialists or plastic surgeons. Laser and pulsed light technology allows just about any doctor to perform the procedures. Candela has an installed base of over 8,000 lasers in 64 countries used by a broad mix of OB/GYNs, family practitioners, and dermatologists, as well as general, vascular, and plastic surgeons.

Cosmetic lasers differ from the types of lasers used by Motley Fool Hidden Gems pick Rofin-Sinar (NASDAQ:RSTI) in that they produce intense bursts of highly focused "cool" light optimized for the specific aesthetic treatment they are performing. Lasers used by Rofin-Sinar are "hot" and are used to cut, weld, and mark industrial products.

Palomar Medical reported record earnings yesterday, with revenues up 57% and earnings exploding over 200% year over year. It even has an agreement with Gillette (NYSE:G) to market a light-based hair-removal system for home use. Candela needs to manufacture and market technologies and innovations like that if it wants to compete effectively.

Candela's lasers have been seen as leading edge, and when a new technology comes along that can help boost the top and bottom lines -- as pulsed light systems have the potential to do -- well, it does need to move in. Still, last year at this time Candela promised great things and wasn't able to deliver. Last quarter it pinned its fortunes on the new technology. But the spotty record of this one-time fast track rocket leaves me feeling leery about its ultimate potential.

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Fool contributor Rich Duprey gets an intense pulse at the sight of a Krispy Kreme doughnut. He owns shares in Candela but does not own any of the other stocks mentioned in the article.