Juniper Networks Grows Revenues, Trims Staff

Juniper is betting heavily on SDN, which isn't a good thing for all of its employees.

By Sean Michael Kerner | Posted Oct 23, 2013
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Juniper Networks reported its third quarter fiscal 2013 earnings late Tuesday, showing continued revenue growth. That growth comes with a cost, however.

For the quarter, Juniper reported $1.186 billion in revenue, a 6 percent year-over-year gain, with $99 million in net income, $0.19 per share. Router product revenue totaled $609 million, an 18 percent year-over-year gain. Total switching product revenue came in at $148 million, up 1 percent year-over-year.

Looking forward, Juniper provided fourth quarter guidance for revenues to range from $1.20 billion to $1.23 billion.

Juniper is also expected to take charge of $10 million in fourth quarter as it reduces its employee base by approximately 3 percent, or 280 employees. Juniper CEO Kevin Johnson said during his company's earnings call that the employee reduction results from the cancellation of the MobileNext project. Juniper's MobileNext was an effort to build new mobile service provider technologies.

Johnson expects that the capabilities MobileNext was going to provide will in fact become part of an x86 virtualized network function. That's an area where Juniper is betting big on its Contrail SDN technology. Juniper acquired Contrail for $176 million at the end of 2012 and, in September of this year, announced plans to open source the new Contrail controller as a cornerstone of the company's SDN efforts.

"Contrail works in private and public cloud environments to virtualize the company's data center network and enable service providers to build new edge networks that significantly reduce the time required to deploy future services," Johnson said.

He added that Juniper has both a commercial and an open license model for Contrail.

"It is our view that the open-source business model of OpenContrail will enable maximum reach, while the commercial Contrail business model allows us to monetize Contrail for those customers who look to Juniper for a supported version of the product," Johnson said.

CEO Search

At the end of the Juniper third quarter earnings call, Johnson announced that he was planning on leaving the company. Ever since, the company's board has been searching for a new CEO for Juniper.

"I would say that we're in the later stages of the process," Johnson said. "There's no news to announce on that today, but I would expect that when they conclude, we'll make that news available, certainly, and just remind you that in the interim, I will continue to fulfill the role as the CEO and will make sure that I'm available to have a smooth and thoughtful transition to my successor."

Sean Michael Kerner is a senior editor at Enterprise Networking Planet and InternetNews.com. Follow him on Twitter @TechJournalist

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