Juniper Networks set an encouraging tone during its fiscal third quarter earnings report Tuesday, saying it met expectations for the quarter but was still feeling the effects of an uncertain economic climate.
Juniper saw good contributions from its key partners during the quarter, but would focus on "being agile and flexible," said CEO Kevin Johnson during an earnings conference call. Many of Juniper's most important markets, including financial services and public sector, are still soft, he said, and customers are expected to maintain a "cautious posture."
Juniper for its third quarter posted revenue of $1.1 billion, up 9 percent from the year-ago quarter. Non-GAAP profit was $149.8 million, or 28 cents per share. Both were in line with Wall Street estimates of 28 cents per share on $1.09 billion in revenue.
For its fourth quarter, Juniper is projecting revenues of $1.16 billion to $1.22 billion and non-GAAP earnings of 32 to 36 cents per share, slightly shy of the 36 cents per share on $1.23 billion in revenue most analysts are expecting.
The Q3 report painted a much cheerier picture than Juniper's Q2, for which it reported lower-than-expected growth and saw its stock price drop soon after. Juniper shares in 2011 overall have declined more than 40 percent.
Juniper draws nearly two-thirds of its revenue, about 62 percent, from the service provider segment, with 38 percent coming from enterprise customers. Third quarter service provider revenue was $685 million, a decline of 6 percent sequentially but an increase of 8 percent from the year-ago quarter. Enterprise revenue was $421 million, up 8 percent sequentially and up 11 percent year-over-year on what CFO Robyn Denholm called strength in routing and switching and "improvement" in security products.
The Americas accounted for 50 percent of Juniper's revenue, and was down 4 percent from the second quarter but up 4 percent from the year-ago quarter. Of note was a contribution from Juniper's wireless LAN portfolio, which includes the assets it acquired with Trapeze Networks in December 2010, of $12 million for the quarter.
Juniper also confirmed it had taken $16.8 million in restructuring charges during the quarter. Juniper had previously confirmed it is cutting headcount as part of an internal restructuring, and Denholm said on the call that Juniper had 121 fewer employees in Q3 than it did in Q2.
Johnson highlighted some of the year's big Juniper product launches, including increasing interest in Juniper's QFabric, naming Bell Canada and Thomson Reuters among its early QFabric customers. He declared that 2012 will boast the "strongest product and solution portfolio in the history of the company."
Johnson added that Juniper's T4000 core router, its latest high-end router, will begin shipping later this quarter. Comcast is an early customer, he said.
Johnson also made note of several recent Juniper executive moves, including installing Stefan Dyckerhoff as the new head of Juniper's Platform Systems Group earlier this year, and the hiring of former Microsoft executive Bob Muglia as Juniper's new executive vice president, Software Solutions Division.