Juniper Networks Growth Driven by Cloud

Juniper generated $5B in revenue in 2016, with particular success for its new QFX product line.

By Sean Michael Kerner | Posted Jan 27, 2017
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Juniper Networks reported its fourth quarter and full fiscal year 2016 financial results on Jan. 26, showing strength in the fast-growing cloud market.

For the quarter, Juniper reported revenue of $1.4 billion for a five percent year-over-year gain. Net Income for the fourth quarter was flat at $197.4 million. Full year net income was up by three percent year-over-year to approximately $5 billion. Net income for the year was reported at $601.2 million. Looking forward, Juniper provided first quarter fiscal 2017 guidance for revenue to be approximately $1.2 billion.

Among the big successes for Juniper is the company's QFX portfolio of high-performance data center switches. During Juniper's earnings call with financial analysts, CEO Rami Rahim commented that the QFX family of products saw strong demand with revenue increasing approximately 90 percent year-over-year in the fourth quarter and over 50 percent for fiscal year 2016.

Rahim noted that with the QFX product line, there is a top of rack component with new spine switches that Juniper has introduced over the last year.

"They're still early in their product life cycle and in many cases we are competing in opportunities where they are still in the evaluation phase," Rahim said. "We now have an ability to position an end-to-end play that includes the spine, the aggregation, the access and the top of rack."

Additionally Rahim noted that in many cases Juniper can also bundle routing, security and the Contrail Software Defined Networking (SDN) orchestration system as well.

Juniper is seeing particularly solid demand from its cloud vertical as the demand for cloud services continues to grow.

"Demand for cloud services is growing very rapidly and cloud customers typically really value high performance, highly efficient power efficient infrastructure and that is exactly of the type that Juniper has and continues to develop," Rahim said.

Looking forward, Rahim expects that in 2017, the cloud will continue to be a primary source of growth for Juniper.

"We're not expecting in our full-year outlook any sort of major recovery in carrier spending," Rahim said. "I think where the spending is going to remain robust is going to be in the cloud space where we have been really focusing and seeing really good growth been throughout last year and I think that continues this year."

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

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