Correction Juniper Networks has slipped something of a surprise into its Q1 2017 financials, announcing that it's no longer going to break out service provider and enterprise verticals in its reports.
The company reported 11 per cent year-on-year growth for the quarter, to US$1.221 billion, and while its $109 million loss for the quarter is 19 per cent more than a year ago, it's an improvement from the $189m hole in Q4 2016.
Its $109 million GAPP profit was down 42 per cent on last year.*
Routing revenue rose a mere 3 per cent year-on-year to $521 million, but switching more than compensated for that by piling on 38 per cent to $242 million.
Rami Rahim said the company's long focus on data centre switching is paying off, as customers in all verticals plot their cloud strategies. He also identified campus momentum for the EX switch range.
Security suffered a 10 per cent year-on-year decline to $66 million; Juniper attributes this to Screen OS, top-end SRX, and legacy products declining, with only a partial offset coming from “the ramp of new products”.
Service revenue added 14 per cent year-on-year.
The company says it's going to change its verticals reporting, saying that Cloud, Telecom/Cable, and Strategic Enterprise “provide better visibility into our business” than the former verticals of Service Provider and Enterprise.
Cloud rose 25 per cent year-on-year to $332 million, Telecom/Cable added 10 per cent year-on-year to $569 million, while Strategic Enterprise added a limpish 2 per cent to reach $320 million.
CFO Ken Miller said Juniper's gross margins are under pressure in both customer mix and product mix: ““There are many factors that impact gross margin. The pricing environment is always challenging, but we haven't seen a broad-based change in that environment.”
He also identified pricing pressure for memory components, something Juniper expects to continue for the rest of 2017.
Its financial announcement is here. ®
*Correction: The author misread a key line in the CFO's commentary: the company reported a $109 million profit. Our apologies. ®