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Shares of Blue Nile Inc. dropped more than 17 percent to $40.50 in after-market trading today after the Internet jeweler said its president, director and chief executive officer Diane Irvine resigned and will leave the firm Friday.

Blue Nile also posted a 32.6 percent decline in third-quarter income and projected weaker-than-expected earnings for the full year.

Vijay Talwar, senior vice president and general manager of international, was appointed interim ceo. During the transition, chairman Mark Vadon will work with Talwar and help the company search for a permanent leader.

Although the firm did not give a reason for Irvine’s departure, Vadon said his former boss has been “a tremendous business partner, making countless contributions in her 12 years at Blue Nile.”

The company posted net income for the period ended Oct. 2 of $1.9 million, or 13 cents a diluted share, down from year-ago income of $2.8 million, or 19 cents a share. Analysts were looking for earnings per share of 18 cents. The company attributed the profit decline to higher commodity costs and the weakening consumer climate, which caused it to cut prices.

Quarterly sales at the Seattle-based online diamond and fine jewelry firm rose 11.2 percent to $75 million, from $67.5 million a year earlier.

Blue Nile said it expects annual EPS of between 87 cents and 89 cents on revenue of between $356 million and $360 million.

Wall Street anticipated EPS of 98 cents on sales of $357 million.