NEW YORK (

TheStreet

) -- Chinese solar company

Suntech Power

(STP)

dropped in pre-market trading on Wednesday morning after reporting an earnings miss and, overall, a third quarter that wasn't clean, in the analyst parlance.

Suntech Power is the first of the big three Chinese module makers to report earnings, though as a whole, solar earnings were well-telegraphed ahead of the season and the Chinese module trio of Suntech,

Yingli Green Energy

(YGE)

and

Trina Solar

(TSL)

, are always at the back-end of the solar earnings calendar. The solar stocks haven't rallied on strong earnings, as uncertain outlook for 2011 demand and a suddenly falling euro weigh on solar shares.

Suntech revenue wasn't the issue, coming in at $744 million, ahead of the Street consensus of $714 million.

However, earnings of 18 cents were short of the Street forecast for earnings of 23 cents, and expectations have been high for all solar companies coming into third quarter earnings reports.

Suntech gross margin was also below the Street at 16.4% versus a consensus call for gross margin of 17.7%.

A foreign exchange of net loss of $32 million was an unexpected one-time charge in a quarter that featured the euro rebound.

Higher wafer prices hit the already highest-cost provider among the Chinese solar module makers. Wafer pricing increases are expected to be a bigger issue in fourth-quarter numbers, but for premium priced Suntech, the wafer market tightness led the company to announce with its earnings the purchase of 375 MW in wafer capacity from an affiliated company, Glory Silicon.

Aaron Chew, analyst at Hapoalim Securities, estimated that the $127 million that Suntech is spending to acquire the 70% of the wafering company it doesn't own equates to a price per watt of 48 cents, above the 35 cents to 40 cents at which standard wafer capacity can be built.

Suntech guided to higher gross margin in the fourth quarter, of 17%, and shipment growth of 10% in the final quarter of the year. For the full year, Suntech expects 1.8 gigawatts of cell and module production capacity on spending of $350 million.

Suntech Power shares were down close to 5% in the pre-market on Wednesday.

-- Written by Eric Rosenbaum from New York.

RELATED STORIES:

RELATED STORIES:

>>Solar Winners: LDK Rallies Alone

>>Solar Losers: 4 Keys to the First Solar Selloff

>>Solar Losers: 5 Keys to the Power-One Selloff

-- Written by Eric Rosenbaum from New York.

>To contact the writer of this article, click here:

Eric Rosenbaum

.

>To follow the writer on Twitter, go to

Eric Rosenbaum

.

>To submit a news tip, send an email to:

tips@thestreet.com

.

Copyright 2009 TheStreet.com Inc. All rights reserved.