It’s the time for earnings season this quarter, and every company has to report on their revenue and profitability, including those in the telecom and networking industries. One of the dominant players to report last Friday (10/24/2014) was Juniper Networks, with unfortunately, some bad news. Q3 revenues declined by 5% YOY, and as a result, it plans to increase more cost trimming measures (of up to $100 Million) in order to bring the numbers into the black for the next earnings season.
The two prime reasons cited for this decline in revenue was:
- Lower than expected demand for its products and services;
- Very slow ramp up of new projects here in the United States.
However, the news of the lower than expected numbers from Juniper should not come as a total surprise. For example, earlier in the month, they did lower their revenue and profit forecast, when demand from US based service providers declined sharply. Third quarter revenue for this year was at $742 Million, down 6% YOY, citing declines in both the United States and the Asian/Pacific Rim markets.
In terms of the Europe, Middle East and Africa (EMEA) markets, overall revenue declined as well by 5%, YOY. More specific losses could be cited in Juniper’s security and routing divisions, which declined by $624 Million. But, its network switching division eked out a small gain of $155 Million.
When asked about Q4 earnings for this year, the company is predicting that revenues will fall somewhere in line between $1.02 Billion and $1.07 Billion. Juniper also predicts that its overall revenue earnings for 2014 will be at $4.57 Billion. However, the company has warned once again, that the next few quarters will be challenging, in terms of revenue generation, primarily due to delays in project deployment.
Juniper Networks, Inc. is an American manufacturer of networking equipment founded in 1996 by Pradeep Sindhu. It is headquartered in Sunnyvale, California, USA.
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