Light Reading
Portfolio transformation sees sale of mobile security unit as Juniper braces itself for a dip in US telco spending.

Juniper Sells Security Unit, Feels Carrier Pinch

Ray Le Maistre
7/23/2014
50%
50%

Juniper took a hit Wednesday as it warned of a slowdown in US telco spending and continued its portfolio transformation under CEO Shaygan Kheradpir.

Despite a sequential and year-on-year increase in second-quarter revenues to $1.23 billion, the vendor saw its share price dip by more than 10% to $22.28 as it revealed how third-quarter revenues are set to be lower than previously expected due to "customer dynamics."

In its earnings release, Juniper Networks Inc. (NYSE: JNPR) noted that it expects third-quarter revenues to be in the range of $1.15 billion and $1.2 billion, and that "specifically, within US-based service providers, their market dynamics, including M&A activity, are impacting both sequencing and timing of projects." (See Juniper Reports Q2 Numbers, Sells Unit and Comcast-TWC: Merger of Equals in Poor Service?)

Financial analysts believe, quite reasonably, that the hit is coming from a change (which may or may not be temporary) in the spending habits of AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ).

In an emailed research note, George Notter at Jefferies & Company Inc. wonders if the two US operator giants might have "made good progress on routing capacity," and so do not need quite as much in the way of upgrades from Juniper. He believes that Juniper might be taking a combined hit of about $100 million from these two customers alone.

Mike Genovese at MKM Partners , meanwhile, believes that operator considerations around NFV could already be affecting their capex strategies. "The company is seeing lower 2H14 demand in North America due to the large cable merger, increased wireless focus at Tier 1 Service Providers and also, we believe, because of the NFV transition," he stated in a research note.


Need to know more about network functions virtualization and the cloud? Then check out the agenda for NFV and the Data Center, September 16 at the Santa Clara Marriott, Calif.


However, the consensus is that Juniper is doing well in other areas -- with the Internet giants and in federal accounts - and that it is also doing well with its corporate cost controls, part of its new Integrated Operating Plan. (See Juniper Bows to Investor Pressure, Refocuses and Juniper Cuts Headcount by 6%, Axes ADC .)

As part of that plan, Juniper has sold its Junos Pulse mobile security portfolio for $250 million to Siris Capital, noting that this is consistent with its strategy to focus on "where its customers and the market is heading with High-IQ networks and building the next-generation of clouds."

Analysts noted that this sale wouldn't affect Juniper's profitability very much on an ongoing basis -- the Junos Pulse business is believed to be running at about break even -- but it does signal a step back from mobile security, an increasingly important sector for many of Juniper's network operator customers.

Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Using Service Quality to Drive WiFi Monetization

10|22|14   |   6:51   |   (0) comments


Live from the SCTE conference: Heavy Reading's Alan Breznick explores the forces shaping the WiFi opportunity in an interview with CableLabs' Justin Colwell and Amdocs' Ken Roulier.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Is Health the Killer App for the IoT?
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/22/2014
Drones Hover Over the IoT Sector
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/23/2014
Analysts Warn of Major NFV Gaps
Carol Wilson, Editor-at-large, 10/22/2014
Roku Raises $25M, But for What?
Mari Silbey, Independent Technology Editor, 10/23/2014
AT&T: Merger Review Halt Won't Hurt Us
Alan Breznick, Cable/Video Practice Leader, 10/23/2014
Like Us on Facebook
Twitter Feed