Juniper closes Q4 with $1.3B in revenue, up 6%

Juniper Networks executives are likely clinking glasses over a positive end to the year: The company brought in $1.3 billion in revenue for Q4 2021, up 6% year-over-year and 9% sequentially.

CEO Rami Rahim said he remains optimistic for growth in 2022 despite supply chain challenges.

"I believe these challenges are likely to prove transitory … Based on our recent order momentum, current backlog levels and our assumptions regarding supply, we currently expect to deliver 7% to 9% sales growth and at least a point of operating margin expansion in 2022," said Rahim in a call with investors yesterday.

Figure 1: Juniper Networks corporate headquarters located in Silicon Valley. (Source: Sundry Photography / Alamy Stock Photo.)

While Juniper's service provider segment slipped 6% in Q3, it returned to growth in Q4, up 8% year-over-year (YoY). The cloud segment was also up 19% but the enterprise segment dropped 3% YoY.

"While Enterprise revenue declined year-over-year due to the timing of shipments, Enterprise orders posted strong double-digit year-over-year growth and exceeded our expectations," said CFO Ken Miller on the financial earnings call.

The timing of shipments also had a negative impact on Juniper's Cloud-Ready Data Center segment, said Miller: "On a year-over-year basis, AI-Driven Enterprise grew 29%, Automated WAN Solutions grew 8% and Cloud-Ready Data Center revenue declined 9%. This decline was entirely due to timing of shipments as Cloud-Ready Data Center orders experienced strong double-digit order growth year-over-year."

Within the Automated WAN portfolio, Juniper launched a new silicon chipset this week – the Trio 6 chipset for Juniper's MX series routers. In addition, Juniper announced the Express 5 silicon for the PTX10K series platforms, which provides non-blocking throughput of 28.8T using 45% better power efficiency than previous chipsets, according to Juniper.

Overall, software and related services revenue reached $242 million for Q4, an increase of 41% YoY, explained Miller on the call. Annual recurring revenue (ARR) increased 32% YoY, with $206 million in ARR for 2021, which Miller said is a result of "our efforts to transform to a more software-centric business."

Juniper's security segment brought in $162 million in revenue for Q4, which Miller said was flat YoY due to shipment timing. Despite slow growth in the segment, the company has been steadily adding to its security portfolio, such as the recent addition of a Branch Security Pack with intrusion detection and prevention systems (IDS/IPS) and URL filtering capabilities for its Session Smart Routing SD-WAN platform.

For 2021, Juniper's revenue hit $4.5 billion, up 7% from 2020. For the year, the cloud business increased 14% and the service provider and enterprise segments were up 4%. In addition, total software and related services revenue increased $761 million, up 42% year-over-year. Total security revenue hit $657 million, an increase of 8% YoY and security product revenue was up 14% YoY. Miller predicts Q1 revenue to be $1.2 billion, which would be a 7% increase YoY.

Juniper's stock rose 5% after last night's call with investors.

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— Kelsey Kusterer Ziser, Senior Editor, Light Reading