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On July 26, 2024
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Juniper disappoints with earnings that fall well short of forecasts - SiliconANGLE
Juniper disappoints with earnings that fall well short of forecasts Juniper Networks Inc. delivered disappointing financial results today in what is likely to be one of the last times it reports as an independent company, prior to being gobbled up by Hewlett Packard Enterprise Co. The company, which is in the process of being acquired by HPE for $14 billion, missed expectations on both earnings and revenue by a wide margin today, though the results didn't have any real impact on its stock. It reported second-quarter earnings before certain costs such as stock compensation of just 31 cents per share, well off the 44 cents per share expected by Wall Street analysts. Revenue for the period declined by 17% to just $1.189 billion, some way below the $1.25 billion analyst target. Despite the misses, Juniper did well to increase its bottom line slightly, reporting a net profit of $34.1 million, up from a profit of $24.4 million one year earlier. Juniper Chief Executive Rami Rahim (pictured) tried to shine the results in a positive light, saying the company saw orders growing by double-digits on both a sequential and year-over-year basis. "We saw particularly robust orders from our cloud customers, many of which have digested prior purchases and are investing to support AI initiatives," Rahim said. "We also experienced better than expected enterprise demand due to continued momentum in our Mist-led Campus & Branch business and strong demand for our Enterprise data center offerings." Juniper is a major supplier of computer networking hardware such as routers and Ethernet switches. It's one of the main rivals to Cisco Systems Inc., and, like that company, also has a sizable business selling network management software for enterprises. The company became a surprise acquisition target for HPE in January. By buying Juniper, HPE will be able to more than double the size of its networking businesses and capitalize on the growing demand for artificial intelligence-powered networks. At the time the deal was announced, analysts said HPE is most interested in Juniper's Mist AI service, which uses machine learning algorithms to optimize performance around wireless access and enhance network security. HPE doesn't have the same expertise, with its main strengths being its channel and go-to-market operations, which is why analysts believe there are strong synergies to be had from combining the two companies. However, the deal has come under scrutiny from regulators in the U.K. Last month, it emerged that the U.K.'s Competition and Markets Authority had launched an investigation into the acquisition, aiming to evaluate if it complies with that country's local competition laws. The CMA said it will publish the results of that investigation by August 13. Depending on the probe's findings, officials may decide to greenlight the deal or launch a more in-depth Phase 2 investigation. Such investigations can potentially lead to the CMA blocking an acquisition or making its completion contingent on changes to the original deal terms. As is customary pending an acquisition, Juniper did not offer any guidance for the coming quarter and it has suspended its stock repurchase program, though it reassured investors it's committed to paying a cash dividend of 22 cents per share by September 23.
[2]
Juniper disappoints with earnings and revenue that fall well short of analyst's expectations - SiliconANGLE
Juniper disappoints with earnings and revenue that fall well short of analyst's expectations Juniper Networks Inc. delivered disappointing financial results today in what is likely to be one of the last times it reports as an independent company, prior to being gobbled up by Hewlett Packard Enterprise Co. The company, which is in the process of being acquired by HPE for $14 billion, missed expectations on both earnings and revenue by a wide margin today, though the results didn't have any real impact on its stock. It reported second-quarter earnings before certain costs such as stock compensation of just 31 cents per share, well off the 44 cents per share expected by Wall Street analysts. Revenue for the period declined by 17% to just $1.189 billion, some way below the $1.25 billion analyst target. Despite the misses, Juniper did well to increase its bottom line slightly, reporting a net profit of $34.1 million, up from a profit of $24.4 million one year earlier. Juniper Chief Executive Rami Rahim (pictured) tried to shine the results in a positive light, saying the company saw orders growing by double-digits on both a sequential and year-over-year basis. "We saw particularly robust orders from our cloud customers, many of which have digested prior purchases and are investing to support AI initiatives," Rahim said. "We also experienced better than expected enterprise demand due to continued momentum in our Mist-led Campus & Branch business and strong demand for our Enterprise data center offerings." Juniper is a major supplier of computer networking hardware such as routers and Ethernet switches. It's one of the main rivals to Cisco Systems Inc., and, like that company, also has a sizable business selling network management software for enterprises. The company became a surprise acquisition target for HPE in January. By buying Juniper, HPE will be able to more than double the size of its networking businesses and capitalize on the growing demand for artificial intelligence-powered networks. At the time the deal was announced, analysts said HPE is most interested in Juniper's Mist AI service, which uses machine learning algorithms to optimize performance around wireless access and enhance network security. HPE doesn't have the same expertise, with its main strengths being its channel and go-to-market operations, which is why analysts believe there are strong synergies to be had from combining the two companies. However, the deal has come under scrutiny from regulators in the U.K. Last month, it emerged that the U.K.'s Competition and Markets Authority had launched an investigation into the acquisition, aiming to evaluate if it complies with that country's local competition laws. The CMA said it will publish the results of that investigation by August 13. Depending on the probe's findings, officials may decide to greenlight the deal or launch a more in-depth Phase 2 investigation. Such investigations can potentially lead to the CMA blocking an acquisition or making its completion contingent on changes to the original deal terms. As is customary pending an acquisition, Juniper did not offer any guidance for the coming quarter and it has suspended its stock repurchase program, though it reassured investors it's committed to paying a cash dividend of 22 cents per share by September 23.
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Juniper Networks reports disappointing Q2 2024 financial results, with earnings and revenue falling short of analyst forecasts. The company faces challenges in the current economic climate.
Juniper Networks Inc., a leading provider of networking technology, has reported its second-quarter financial results for 2024, which have fallen significantly short of analyst expectations. The company's performance has raised concerns among investors and industry watchers about its ability to navigate the current economic landscape 1.
For the quarter ending June 30, Juniper reported earnings of 42 cents per share on revenue of $1.13 billion. These figures represent a substantial miss compared to Wall Street's forecasts, which had projected earnings of 55 cents per share on revenue of $1.23 billion 1. The company's performance indicates a challenging period for Juniper in terms of both profitability and sales growth.
Following the announcement of the disappointing results, Juniper's stock price took a hit in after-hours trading. The market's reaction reflects investor concerns about the company's current trajectory and its ability to meet future growth expectations 2.
While specific details are limited, industry analysts speculate that several factors may have contributed to Juniper's underperformance. These could include:
Despite the disappointing quarter, Juniper Networks remains a significant player in the networking technology industry. The company's management is likely to face questions from investors and analysts about their strategies to address the challenges and improve performance in the coming quarters 2.
Juniper's results may also serve as a bellwether for the broader networking and enterprise technology sectors. Other companies in the industry will be closely watched to see if Juniper's challenges are indicative of wider market trends or specific to the company's own circumstances 1.
As the technology landscape continues to evolve, Juniper Networks faces the task of adapting its strategies and offerings to regain momentum and meet the expectations of both customers and investors in an increasingly competitive market.
Hewlett Packard Enterprise (HPE) has priced a $1.35 billion offering of mandatory convertible preferred stock to help finance its acquisition of Juniper Networks. The move has led to a decline in HPE's share price.
5 Sources
Hewlett Packard Enterprise (HPE) has increased its annual profit forecast, driven by strong demand for artificial intelligence. The company's shares rose following the announcement of better-than-expected quarterly results and an optimistic outlook for the fiscal year.
10 Sources
Bank of America upgrades Hewlett Packard Enterprise to Buy from Neutral, citing AI opportunities and the Juniper Networks acquisition as key catalysts. The move sparks a surge in HPE's stock price.
4 Sources
Hewlett Packard Enterprise (HPE) has announced the pricing of its public offering of mandatory convertible preferred stock, aiming to raise approximately $1.35 billion. The offering is part of HPE's strategy to finance its pending acquisition of Juniper Networks.
2 Sources
Juniper Networks introduces groundbreaking AI-native networking solutions, including the Marvis AI assistant, to enhance network performance, security, and user experience. This innovation marks a significant shift in the networking industry towards self-healing and proactive management.
2 Sources