Lowered revenue projections from edge networking vendor Eastern Research allowed Sycamore Networks to renegotiate the price it paid to acquire the company this year, Sycamore said during a quarterly earnings call today.

During Sycamore’s first fiscal quarter (which ended Oct. 28), Eastern contributed $6.4 million in revenue in the seven weeks that it was part of the company. That represents a dip in Eastern’s typical performance, Sycamore executives said. Eastern reported about $62 million in revenue for 2005, giving it a historical run rate of about $15 million per quarter. The $6.4-million partial quarter was “a little under” that rate, Sycamore’s chief financial officer Richard Gaynor said, which allowed Sycamore to renegotiate the terms of the acquisition this summer.

Though Gaynor called it “short-term revenue softness,” Sycamore executives declined to project future revenue due to an ongoing investigation of the company’s stock option award practices.

When Sycamore initially announced the acquisition of Eastern Research in April, the deal included $84.5 million in stock and $8 million in cash--a combination that surprised investors since it includes so much stock while Sycamore sits on more than $900 million in cash. In August, Sycamore announced revised terms of the deal to include only $80 million in cash--no stock.

Eastern sells multiservice crossconnects and access gateways that groom, aggregate and manage access traffic. Its customers include Tier 1 wireless and wireline carriers, utility companies, government agencies and the military. Among them are Australian carrier Telstra and the U.S. Federal Aviation Administration. The vast majority of its revenue has come from the U.S. About a third has come from wireless carriers in particular.

During the company’s earnings call today, Sycamore’s chief executive officer Dan Smith again called the Eastern acquisition a “first step” toward offering a more comprehensive product portfolio. The integration of Eastern--including “product line rationalization”--is “largely complete,” he said, and the acquisition should be accretive within five quarters. According to a Sycamore spokesman, the company has discontinued development of a cross-connect that Eastern had not yet brought to market.

Going forward, the company’s quarterly investments in research and development will be less than the sum of Sycamore and Eastern’s R&D expenses, Smith said. During the quarter, Sycamore took the “initial steps” to create an Asian development center but wouldn’t elaborate on that effort.

Revenue from Sycamore’s core platform was up 75% sequentially and 4% from a year earlier to $28.5 million. That business is typically lumpy from quarter to quarter and concentrated among just a few customers. Four top customers contributed 77% of Sycamore’s $35 million in total revenue for the quarter. Last fiscal year, Sycamore’s top customers were Vodafone, Sprint and Siemens.