The numbers came out fine, but even Juniper isn't immune to some cautious buying patterns by its customers
Juniper Networks Inc. (NYSE: JNPR) was right in predicting that it wouldn't get hit early by any recession, but the effects of the economy are finally catching up to the company.
Juniper's fourth-quarter results, announced today, were on target, although revenues of $923.5 million were just below the $936.5 million analysts expected, according to Reuters Research . (See Juniper Posts Q4.)
But the company is predicting its first quarter, which ends in March, will see revenues of $800 million to $830 million. That's well off the $887.3 million analysts had predicted and a substantial drop from the fourth quarter.
Orders are still coming in. In fact, Juniper says its book-to-bill ration exceeded 1 in the fourth quarter -- a sign that sales are increasing.
But customers have been asking for delayed delivery on the gear they order. That's why fourth-quarter revenues fell short of the analysts' estimate -- because some orders got pushed beyond the boundary of the quarter.
"This was especially so in the service provider business," CFO Robyn Denholm said during today's conference call with analysts, and Juniper expects the trend to continue this quarter.
Chairman Scott Kriens had predicted last year that Juniper wouldn't be among the early casualties of a recession, since its equipment is going into network projects that are so critical to service providers and enterprises. (See Juniper: What Recession? and Juniper Spreads Sunshine in Q3.)
Juniper has started some cost-cutting maneuvers, although CEO Kevin Johnson didn't mention any layoffs. Rather, Juniper is cutting its travel budget and increasing the use of videoconferencing -- the Cisco TelePresence sales team should be glad to hear that -- and curtailing hiring.
But the hiring freeze doesn't apply to "critical R&D programs," Johnson said.
For its fourth quarter, which ended Dec. 31, Juniper reported revenues of $923.5 million and net income of $132.5 million, or 25 cents per share.
That compares with the prior quarter's revenues of $947 million and net income of $148.5 million, or 27 cents per share. For its fourth quarter a year ago, Juniper reported revenues of $809.18 million and net income of $122.9 million, or 22 cents per share.
Non-GAAP earnings of 32 cents per share were on par with analyst expectations.
— Craig Matsumoto, West Coast Editor, Light Reading
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