Arrow Electronics reported strong third-quarter earnings recently and also announced a new distribution agreement with Juniper Networks. Andy Bryant, president of Arrow Enterprise Computing Solutions, the company's enterprise channel-focused arm, recently spoke with CRN's Scott Campbell and Chad Berndtson about the company's financial performance, its strategy towards Juniper, and other subjects. The following are excerpts from the conversation.
Arrow reported its third-quarter earnings last week, showing strong growth. Can you provide some more details on that business in the quarter?
The third quarter was very strong. Our resellers enjoyed a little better summer than I think most thought. Some federal spending did come through. There was some question marks around that but it did play out. We had our second quarter in a row at or above seasonality.
You also announced a new relationship with Juniper Networks last week. What are you hoping to do with that vendor for your VARs?
Juniper is a great addition to our data center lineup. One of our focuses on coverage is taking care of the communications market. They're looking to penetrate the enterprise data center and now we have access to their full switching, routing and security product lines. Particularly in cloud, they're a real player in the networking security space around cloud. This is going to be a very important line for ECS going forward.
How many of your current VARs sell Juniper? Is your role to find new VARs or do have a lot that now buy Juniper from other sources?
I assume there are some already buying Juniper. Our role is recruiting, but we'll probably take some exiting Juniper VARs looking to move further up the food chain around the data center focus.
What sorts of resources and programs are you putting around Juniper?
We just announced it so we're just launching the line. We will put in the resources and surely there will be programs, but I will defer to others [at Arrow] as to what those are.
Going back to the 3Q numbers, what areas were particularly strong?
The two areas that I know where we were exceptionally strong were software and services. Within software, we count virtualization. Virtualization was very strong in year-over-year growth. Storage continued to have a good solid pace. But the biggest upside for us came in services. We're doing a lot of things there. We're reselling services but also offering our own services. We work with VARs on that service and we're getting traction there.
Servers weren't as fast growing as they were in the March quarter, but they continue to grow. Proprietary servers were up 18 percent, industry standard servers were up 6 percent year over year. The combination of the two was pretty good, but not as fast as the last two quarters.
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