Juniper Networks beat consensus estimates with its second quarter results, posting a solid quarter in which sales rose 32 per cent and profit jumped 40 per cent.
For the period ended June 30, 2008, Juniper recorded net revenue of US$879 million. Wall Street analyst had expected US$852.3 million in revenue for the quarter.
Juniper tallied a profit of US$156.6 million, or 28 cents per diluted share, for the second quarter, minus expenses, charges and other items. Wall Street was expecting earnings to come in at 27 cents per share.
"We're very pleased with the solid results we have delivered for the first half of 2008," stated Scott Kriens, chairman and outgoing CEO of Juniper. Juniper Thursday announced that it had tapped Microsoft executive Kevin Johnson to succeed Kriens as CEO on September 8 while Kriens continues as company chairman.
"This is a testament to the strength of our product cycles, the power of our portfolio strategy and the expanded opportunities made possible by the early success of the EX-series (LAN switches), which together serve to underscore our improved outlook for the second half of the year," Kriens said in a statement on the quarterly results.
Juniper boosted its outlook for the third quarter and the rest of the year. The company expects to post revenue of US$925 million to $935 million and earnings of 29 cents to 30 cents per share. For the full year, Juniper expects revenue of US$3.59 billion to $3.62 billion -- up from US$3.4 billion to $3.55 billion -- and earnings of US$1.14 to $1.17 per share.
For the second quarter, product revenue was US$724 million in the quarter, while services tallied US$155 million. Infrastructure accounted for US$672.5 million, up from $481 million in Q2 '07, an increase of 40 per cent. Service Layer Technologies, comprised mostly of security, application and WAN acceleration products, contributed US$206.6 million, up from $184 million a year ago, an increase of 12 per cent.
Juniper experienced some softness in application acceleration, Kriens said during a conference call with analysts on the second quarter results. But overall, the company's enterprise business was up 29 per cent over last year.
The new EX3200 and 4200 Ethernet switches are gaining traction, with shipments to more than 100 customers and US$10 million in revenue in the quarter.
In service provider, sales of edge routers accounted for half the revenue in Infrastructure in the quarter. The MX series Ethernet edge routers are deployed at 250 customer sites in 43 countries, and is on an annual run rate of US$300 million, Kriens said.
In core routers, bookings and shipments of the high-end T1600 doubled in the quarter.
"Juniper is strong and getting stronger," Kriens said. "Our strategy is working."