Juniper Sees Higher Revenue in Third Quarter

Much of the revenue gains came from Juniper's services business, which saw a 33 percent jump to $103.6 million.

Juniper Networks reported on Oct. 18 a 5 percent rise in revenue for its third fiscal quarter of 2006, but the company did not detail net income and earnings because of an ongoing internal stock options investigation.

Revenue for the quarter rose to $573.6 million compared to $546.4 million a year ago. For the year to date, revenues are up just under 15 percent to $1.7 billion, compared with $1.5 billion.

Much of the revenue gains came from Junipers services business, which saw a 33 percent jump to $103.6 million.

Revenue was also up 1 percent compared to the second fiscal quarter of this year, according to Scott Kriens, chairman and CEO of the company.

"From a financial perspective, we met our targets," said Kriens, who added that Juniper is generating $500 million in cash per year. Juniper now has $2.4 billion in cash.

Juniper sought to downplay the uncertainty cast by the stock options investigation and a continuing slide in router revenue by playing up a much-anticipated new carrier Ethernet switch/router that it launched Oct. 18.

The new MX960, because it will run the Junos operating system software, "is proven to scale on the first day. It joins 30,000 M-Series and T-Series installed routers. It sets new density and price/performance for the industry," said Kriens.

"Today we change the game in this market. No one has the sale and performance and integrated functionality we deliver," he added.

Still, it wont be available for generating revenue for Juniper until the first quarter of 2007.

/zimages/5/28571.gifTo read more about the MX960, click here.

Technology highlights during the quarter included new 10 Gigabit Ethernet and high-density Gigabit Ethernet line cards for the E320 Broadband Services Router that provide multicasting optimization designed to reduce cost and complexity for service providers rolling out IPTV and triple-play services.

Juniper also broadened its line of Secure Services Gateway security appliances for the enterprise, bringing the number of different models in the family up to nine.

Three new models, the SSG 5, SSG 20 and SSG 140, which combine firewall, virtual private networking, routing and unified threat management, are aimed at telecommuters, small branch offices and medium-sized offices.

Kriens said the integration of functions in the appliances helped to propel Juniper into the No. 2 slot for security offerings worldwide during the quarter.

Even though Junipers routing business has been down for three consecutive quarters, Kriens said that market demand is increasing on two fronts: quality and quantity.

"The demand for router or network quality is increasing most of all. What drives quantity demand will be interesting to watch. Peer-to-peer video [YouTube]—blasting traffic from anywhere to anywhere—changes demand dramatically in terms of quantity. High-volume [video] traffic has a huge impact on network designs," he said, describing the future growth of that as a "wild card."

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