& cplSiteName &

Juniper CEO Preps New Roadmap

Ray Le Maistre
1/24/2014
50%
50%

Juniper Networks CEO Shaygan Kheradpir, who is only days into his new job, is set to unveil what he calls an "Integrated Operating Plan" during the next few weeks following a review of the vendor's business. (See Juniper Names New CEO.)

Kheradpir told analysts during Juniper Networks Inc. (NYSE: JNPR)'s fourth-quarter earnings conference call that he would reveal a plan focused on "profitable growth and shareholder value creation."

The CEO said the plan would include a greater focus on product innovation, a more efficient cost structure -- that will have the company's near 9,500 staff wondering what's coming down the line, as more than 230 employees were axed during the fourth quarter -- and an evaluation of a "capital returns policy," which could involve share repurchasing and dividends.

The reference to "shareholder value creation" will have been heard loud and clear at activist investor Elliott Management, which tore into Juniper earlier this month and demanded major changes, including a greater focus on the service provider sector and an exit from the security market. (See Investor to Juniper: 'You Suck'.)

Elliott, which has had a very busy start to 2014, isn't happy with Juniper's financial performance, but there seemed little wrong with the router vendor's performance towards the end of 2013, as Juniper reported record sales and strong margin growth for the fourth quarter, as the table below shows. (See Riverbed Spurns Takeover Offer.)

Table 1: Juniper's Fourth-Quarter 2013 Key Financials

In US$ millions Q4 2013 Q4 2012 Change Full Year 2013 Full Year 2012 Change
Revenues $1,274 $1,141 12% $4,669 $4,365 7%
Operating margin 15.3% 11.5% Up by 3.8 percentage points 12.1% 7.1% Up by 5 percentage points
Net Income $151.80 $95.70 58.6% $439.80 $186.50 135.8%

Of the company's fourth-quarter revenues, $827 million (about 65% of the total) came from service provider customers. Those service provider sales are 12% better than a year earlier and 5% better than in the third quarter, while the full year's total revenues from service providers of $3 billion was 9% better than in 2012.

CFO Robyn Denholm noted on the conference call that Juniper also had strong bookings from service provider customers in the Americas, with particularly strong demand from cable operators and Web 2.0 customers. In Europe, service provider demand was strong in Germany, the UK, and Eastern Europe.

Denholm also noted that fourth-quarter router revenues were at $618 million, up 16% compared with a year earlier, and that bookings were "very strong," ramping by more than 30% year-on-year "driven by MX and PTX product lines," while demand for the new MX104 router is "off to a solid start." (See Juniper Aims Big With 100G Optical and SDN Middleman: A Second Look at Juniper's MetaFabric.)

Although revenues from security products were down 7% year-on-year to $157 million, the CFO noted that Juniper had seen encouraging signs that suggest a turnaround in the market.

Now Juniper's staff, customers, partners, and investors will wait for Kheradpir's new plan to see if he has anything radical up his sleeve. The company has already axed its mobile packet core line (MobileNext) in recent months: Will it be joined by any other product lines? (See Juniper Puts a Virtual Spin on MobileNext.)

— Ray Le Maistre, Editor-in-Chief, Light Reading

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
DOShea
50%
50%
DOShea,
User Rank: Blogger
1/24/2014 | 12:45:02 PM
The "You Suck" Singers...
Looks like another investor, Jana Partners, has joined the "You Suck" chorus, though it's done so while increasing its investment in Juniper... I guess everyone want to make sure their voices are heard by Kheradpir.

http://www.marketwatch.com/story/juniper-networks-microsoft-rally-igt-sinks-2014-01-24?reflink=MW_news_stmp

 
Ray@LR
50%
50%
Ray@LR,
User Rank: Blogger
1/24/2014 | 12:14:42 PM
Re: Juniper's security sales down 7% YoY
Great insights Patrick!

Of course, we have to wait and see if Kheradpir will give the security team time to push back at all... 
pdonegan67
50%
50%
pdonegan67,
User Rank: Light Sabre
1/24/2014 | 11:22:55 AM
Juniper's security sales down 7% YoY
The 7% YoY decline in Juniper's security sales lends credibility to F5's claims to be taking share from Juniper with its push into the security space with DNS security, Firewall, DDoS protection and other security capabilities.

The network security space is very dynamic at the moment. A lot of vendors with large footprints - folks like F5, Nominum, Infoblox - are looking to leverage large installed bases of networking equipment and evolve them to meet the operator's security goals.

Incumbent security specialists like Juniper are not having things all their own way in the telco space any more. There's some intense strategy and R&D work going on on this area. I'm expecting some epic contests for carrier mind (and wallet) share in 2014.

Juniper has suffered from indecisiveness in some carrier network segments of late but in the case of security where they have been - still are - the market leader I fully expect them to push back hard.
Light Reading’s Upskill U is a FREE, interactive, online educational resource that delivers must-have education on themes that relate to the overall business transformation taking place in the communications industry.
LIVE NOW!
Friday, December 2, 1:00PM EST
The SDN Approach to IP & Optical Integration
Sterling Perrin, Senior Analyst, Heavy Reading
UPCOMING COURSE SCHEDULE
Friday, December 2, 1:00PM EST
The SDN Approach to IP & Optical Integration
Sterling Perrin, Senior Analyst, Heavy Reading
in association with:
From The Founder
Light Reading today starts a new voyage as part of a larger Enterprise.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Women in Comms Introduction Videos
Korn Ferry Consultant: How to Find, Cultivate & Be the Best Talent

11|30|16   |   4:10   |   (1) comment


Erin Callaghan, a managing consultant for Korn Ferry Futurestep, shares strategies for companies to improve how they recruit and for women to ensure they don't get lost in the pipeline.
LRTV Custom TV
We Can Make the World More Sustainable

11|29|16   |     |   (0) comments


GeSI is a global e-Sustainability Initiative organization bringing together 40 big multinational companies around the world. According to GeSI's report, information and communication technology can make the world more sustainable. Luis Neves, chairman of GeSI, shared with us his opinion at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
Finding a New Way to Engage Customers & Drive Revenue

11|29|16   |     |   (0) comments


Mobile revenues are declining. Digicel, a player in the Caribbean telecommunications/entertainment space, has found a new way to engage customers and drive revenue. John Quinn, CTO of Digicel, shared with us its story at Ultra-broadband Forum (UBBF2016)
LRTV Custom TV
Do You Really Need Gigabit Infrastructure?

11|29|16   |     |   (0) comments


Altibox is the biggest fiber-to-the-home (FTTH) player and the largest provider of video and TV in Norway. They started out with zero customers in 2002. Now they have close to half a million households and companies attached to their FTTH business. Nils Arne, CEO of Altibox shared with us their story and insight on 5G at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
BT’s Openreach Strategy & Its Updates in 2016

11|29|16   |     |   (0) comments


A lot of developments at Openreach this year in terms of strategy and planned investments. Peter Bell, CIO of Openreach BT, shared with us the updates of Openreach at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
ITU: The Broadband Is Our Future

11|29|16   |     |   (0) comments


At Ultra-broadband Forum, Houlin Zhao, Secretary General of ITU, discussed how important it is for countries, companies and everybody to be working together to help to build the broadband and digital economies (UBBF2016).
LRTV Custom TV
Tackling 5G in Dallas

11|28|16   |     |   (0) comments


Here are our highlights of the 5G North America show in Dallas, Texas with Light Reading's Dan Jones.
LRTV Interviews
Cox Prepping for Virtualization Trials

11|14|16   |     |   (0) comments


In this video interview, Cox's Jeff Finkelstein discusses MSO's plans to test managed business services in early 2017 and tackle Distributed Access Architectures.
LRTV Custom TV
Drivers & Potential of NGP

11|11|16   |     |   (0) comments


ETSI has created an Industry Specification Group to work on Next Generation Protocols (NGP ISG), looking at evolving communications and networking protocols to provide the scale, security, mobility and ease of deployment required for the connected society of the 21st century. The NGP ISG will identify the requirements for next generation protocols and network ...
LRTV Custom TV
Huawei IP 2020 for Future Networks

11|11|16   |     |   (0) comments


Future Networks should satisfy many requirements such as high throughput, extremely low latency, flexible mobility, intrinsic security, networking automation, and so forth. The Chief Architect of Huawei Future Networks addresses a holistic solution, i.e., IP 2020, to achieve these requirements for various future life scenarios (e.g., autonomous driving, tactile ...
LRTV Custom TV
Digital Object Architecture

11|11|16   |     |   (0) comments


Digital Object Architecture provides a basic information infrastructure that can facilitate interoperability between or among different systems, processes, and other information resources, including different identity management systems. Digital objects are networked objects that are named by digital object identifiers and instantiated by an infrastructure service ...
LRTV Custom TV
BT's Openreach Has High Hopes for Long-Reach VDSL

11|11|16   |   06:04   |   (0) comments


Peter Bell, Network Portfolio CIO at BT's access business Openreach, talks about the operator's trial of a new broadband access technology called Long Reach VDSL.
Upcoming Live Events
December 6-8, 2016, The Westin Excelsior, Rome
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
AT&T Debuts DirecTV Now on New Video Platform
Mari Silbey, Senior Editor, Cable/Video, 11/28/2016
Apple Seeds 5G? Seeks 'Multi-Gigabit' Chip Designer
Dan Jones, Mobile Editor, 11/30/2016
Altice Plans FTTH for Entire US Footprint
Iain Morris, News Editor, 11/30/2016
Altice FTTH Bill Could Hit Almost $9.6B in US
Iain Morris, News Editor, 12/1/2016
Samsung Bows to Investors, Considers Revamp
Iain Morris, News Editor, 11/29/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Live Digital Audio

Even when there's a strong pipeline of female talent in the comms industry, it tends to leak all the way to the top. McKinsey & Company says women experience pipeline leakage at three primary points: being unable to enter, being stuck in the middle or being locked out of the top. Each pipeline pain point presents its own challenges, but also opportunities to stop the leak. Wireless operator Sprint is making a conscious effort to improve its own pipeline from new recruits to the C-suite, and it wants the rest of the industry to do the same. In this Women in Comms radio show, WiC Board Member and Sprint Vice President of Enterprise Sales Nelly Pitocco will give us her take on the industry's pipeline challenges. Pitocco, who joined Sprint in May and has spent 20 years in the comms industry, will also offer solutions, share how Sprint is tackling the challenge within its own organization and take your questions live on air.