Look underneath, leaf undersides. See if you don't find evidence and frass of insects. Azalea lace bug.

Here is a link that might be useful: Azalea Lace Bug

That's it! Thank you so much. Since these are new plants, should I hold off a ground treatment until the fall?

Our climates are so different, I'd hoped someone who experiences some heat might answer you - I'm not sure a soil drench in Fall would be helpful. The recommendation seems to be (if plants are so heavily infested chemical control is necessary), insecticidal soap or approved insecticide when pests are numerous, normally July/Aug. Make sure if you were to use something it is safe on azalea and never spray in heat of day. If a soil drench were to be used it is suggested in earliest Spring to effectively reduce the lace bug population.

At this point in the year, there's nothing you can do about the existing damage to the leaves. Spraying with insecticidal soap or another product listed as effective on lacebugs will kill the adults by contact or systemic action, so it will reduce the lacebug population. In a warm climate such as GA several generations of lacebugs can appear in a single season, so this is probabably worth doing. If you prefer a systemic drench, do it now for the same reason as above. The drench would have to be redone next year before damage occurs. Your County Extension Service or state agriculture department can give you the dates to do this.

The leaves are what they are now and they will not recover. If the lacebugs are still visiting, the best you can do is release beneficial insects now, apply insecticidal soap/insecticide or use a systemic insecticide. I found a fertilizer-systemic insecticide once that I applied early on the following year to potted plants.

If I discover the problem after the lacebugs have left, I leave the plants alone but I make a note in a wall calendar to start applying/doing something 1-2 months earlier (mid May for example).

This post was edited by luis_pr on Fri, Jul 18, 14 at 20:46

I had a lace bug infestation that killed off one of my plants and almost did in the other.
take your hose and spray the undersides of the leaves to get all the black dots off which are lace bug eggs covered in poo.
I also used a natural bug killer from HD.

Just make sure spray them off every couple days till they are mostly gone taken extra time to lift the branches so you can get the undersides real good.

My plant is doing really well though it hasn't bloomed. The foliage has been replaced with large green leaves. there are still a few bare spots left but they are filling in too

Should leaves be removed when you have a n infestation of these lace bugs or just keep spraying them every few days?

I leave the leaves on the plant (they will eventually fall off soon enough in Fall).

Once I note no more "new" damage, I put a note in a wall calendar and spray for an additional 2 weeks. I also make a note to s-t-a-r-t spraying next year a month (or so) before the whole mess was detected.