CEO Antonio Neri: HPE Is Incentivizing HPE-Juniper Sales Forces To Sell Both Networking Portfolios

‘The channel community is super excited to be able to sell both [vendors’] products because the combination of both products allows them to cover every vertical, every use case, in every geography,’ said HPE CEO Antonio Neri.

HPE is incenting the Aruba and Juniper Networks sales teams to sell both networking portfolios in a bid to drive sales momentum in the wake of HPE’s $13.4 billion acquisition of Juniper Networks, which closed in July.

“We are already incentivizing both sales forces to sell both [vendors’] products,” said HPE CEO Antonio Neri in a conference call with Wall Street analysts, marking the first time HPE has reported combined HPE-Juniper results. “And I can tell you the channel community is super excited to be able to sell both products because the combination of both products allows them to cover every vertical, every use case, in every geography.”

The big HPE investment to compensate both the HPE and Juniper sales teams to sell the entire product line is aimed at eliminating sales conflict or infighting as HPE moves to integrate the sales teams at the end of 2025. The investment ensures HPE and Juniper sales reps will get compensated to mount a united networking sales offensive in front of customers.

“The progress we have made is very strong,” said Neri of the HPE-Juniper integration. “The integration is progressing really well.”

Neri said in the campus and branch networking segment, HPE and Juniper are going to “thoughtfully integrate” the Juniper platform and the Aruba Networking Central platform.

“We are not going to leave any customer behind,” said Neri. “We are going to sell both products, and you are going to see an integration that happens over time through the AIOps layer. That’s the opportunity we have here. The good news is customers want both today, and we can serve every market vertical, and we can also deploy any type of solution, whether it is cloud-based, virtual private cloud, sovereign or on-prem.”

HPE is also working on integrating its HPE Private Cloud portfolio with the software-defined networking component from Juniper, said Neri.

Finally, HPE is also driving integration with its storage and server business with networking switches.

Solution provider executive Pat O’Dell, the head of Hewlett Packard Enterprise’s North America Partner Advisory Council, said he sees the big HPE investment to incentivize both the HPE and Juniper sales teams ensuring that the combined HPE networking team is “rowing” in the same direction with its partners with no sales or channel conflict.

“For me, it’s all about doing what is best for customers,” said O’Dell, the managing partner at HPE stalwart partner CPP Associates, Clinton, N.J. “I see a tremendous investment and commitment from HPE to get the HPE-Juniper integration right. I have been excited for a while about HPE’s investment in having the best overall infrastructure portfolio. This is just another major piece of the puzzle.”

HPE partners are anxious to get up and running selling the combined HPE-Juniper networking portfolio as quickly as possible, said O’Dell. “Everyone is interested in what the sales playbook is for HPE-Juniper around sales processes and certifications,” he said. “We all see a big opportunity here to drive sales growth.”

In fact, the CPP sales team feels it can grow the company’s networking business at least 50 percent over the next 12 months to 18 months, said O’Dell.

CPP is beefing up its networking talent, recently adding a Juniper networking technical specialist to its team in a bid to drive HPE networking sales growth.

Mike Vencel, president of Comport Consulting, Ramsey, N.J., a top HPE enterprise partner, said he is hoping to double Comport’s sales in the networking business in the wake of the HPE acquisition of Juniper.

“We’re not looking at 20 or 30 percent growth” he said. “We’re looking to double that business. There are plenty of networking customers that we have won, but we are at the juncture now with this deal where we could go and get the whole networking stack. That is how I get to the calculus of how I can double my networking business.”

Vencel said he sees HPE and Juniper making it “easy and fast” for partners to get to market quickly with the combined HPE-Juniper product set. “HPE wants to create an environment where, whether Aruba or Juniper comes out on top on existing sales cycles, they both get paid,” he said.

The HPE-Juniper networking sales offensive comes as rival Cisco faces a channel leadership change. Cisco Global Channel Chief Rodney Clark left the networking market leader last month in the wake of partner angst surrounding the new Cisco 360 channel program. Clark was replaced by highly respected Cisco veteran Tim Coogan who is now leading the Cisco channel charge.

“The timing couldn’t be more perfect for HPE-Juniper,” said Vencel. “If HPE rolls out a partner-friendly program, they can shift share from Cisco to them. You couldn’t ask for a better situation if you are HPE-Juniper.”

The combined HPE-Juniper networking business reported sales for the third fiscal quarter, ended July 31, of $1.7 billion, up 54 percent from the prior year period with a 20.8 percent operating profit margin compared to 22.4 percent in the year ago period. The quarter included one month of Juniper results.

Neri said HPE sees a networking market recovery with every sub-segment posting a strong performance in the quarter, whether it was HPE’s Aruba networking business on its own or Juniper’s networking business. “If you look at campus and branch, both companies are doing very well, growing at double digits. That is very strong,” he said.

Juniper, meanwhile, has had “record-breaking” performance in data center switches and “very good performance in routing,” said Neri.

In the hyperscaler service provider and AI model builder segments of the market, HPE is aiming to lead with AI networking as a differentiator to win business. “The opportunity is significant,” he said. “Juniper is getting traction. It is becoming the de facto standard in many of those customers. The opportunity with HPE is to expand that footprint.”

The strength in the AI networking business makes HPE stronger in the overall AI market, said Neri, because of Juniper’s prowess in AI networking at scale. “Juniper brings amazing technology both [in] data center switching and routing,” he said.

Overall in the quarter, HPE reported better-than-expected sales of $9.13 billion, up 19 percent from $7.71 billion a year ago. The Zacks consensus estimate was $8.78 billion.

The company reported non-GAAP earnings attributable to HPE of $631 million, or 44 cents per share, down from $661 million, or 50 cents per share, from the prior year period. The results were within the HPE outlook range of 40 cents to 45 cents per share.

In after-hours trading Wednesday, HPE shares were up 42 cents, or 2 percent, to $23.24.

Neri said he and HPE Networking President and General Manager Rami Rahim will detail the networking integration road map, including the sales force integration and channel integration, at the HPE Securities Analyst Meeting on October 15 in New York.

“Going forward our goal is to build the best networking business,” said Neri. “That means we are going to grow above market. That is the reality. We are going to explain [at the security analyst meeting] how that is going to be the case over the next three years.”