Juniper profit up but shy of higher expectations

By Philipp Gollner

SAN FRANCISCO (Reuters) - Juniper Networks Inc (JNPR.O: Quote, Profile, Research, Stock Buzz), the world's second-largest maker of routers for the Internet, reported on Tuesday a 46 percent jump in quarterly profit, but its shares fell after the results missed some investors' raised expectations.

Juniper reported earnings before certain items of 22 cents per share, one cent above analysts' average forecast of 21 cents per share but shy of what was expected by some investors. The stock is up about 90 percent this year.

"They beat by just a penny, but they should have beat by two pennies or three pennies," said Ehud Gelblum, an analyst at JPMorgan who has an "overweight" rating on the shares. "But what will carry the day is the higher revenue and the higher gross margin."

Juniper shares fell 7.1 percent following the earnings report after adding 3.5 percent to close at $37.14 on Nasdaq.

Juniper, which sells telecommunications equipment and digital networks for businesses, has benefited from growth in online video and other Internet uses that require high-speed Web service. It competes with Cisco Systems Inc (CSCO.O: Quote, Profile, Research, Stock Buzz), the largest maker of such equipment.

Some analysts have said Juniper's core router, the T1600, a new space- and energy-efficient model, will help it grab some market share lost to Cisco over the past year. Juniper Chief Executive Scott Kriens said the company has the potential.

"We clearly have the opportunity to improve our position in the market, given the strength of our technology, and timing of delivery and the capabilities," he told Reuters in an interview.

Third-quarter revenue rose to $735 million from $573.6 million, beating the average analyst estimate of $707.8 million, as compiled by Reuters Estimates. Net income rose to $85.1 million, or 15 cents per share, from $58.3 million, or 10 cents per share, a year earlier.