* Q3 rev $823.9 mln, higher than Street view of $799.5 mln
* Q3 EPS excluding items 23 cents vs Street's 21 cents
* Sees Q4 rev $860-895 mln, higher than market's $835 mln
* Shares up 1.4 pct
(Updates with outlook and CEO comments, rise in shares)
By Ritsuko Ando
NEW YORK, Oct 22 Network equipment maker
Juniper Networks Inc's JNPR.O quarterly results and outlook
exceeded Wall Street estimates, adding to hopes that a recovery
in telecommunications spending was underway.
However, analysts said they were still concerned about how
the company plans to grow in the long term, particularly in
light of recent mergers and acquisitions among rivals,
including industry leader Cisco Systems Inc (CSCO.O).
Revenue for the quarter ended Sept. 30 fell 13 percent from
a year earlier to $823.9 million, but was up 5 percent from the
previous quarter and higher than the average analyst forecast
of $799.5 million according to Thomson Reuters I/B/E/S.
Net income fell to $83.8 million, or 16 cents per share,
from $148.5 million, or 27 cents a share, in the year-ago
Earnings, excluding items, were 23 cents a share, down from
32 cents a year ago but higher than expectations of 21 cents.
"Our Q3 results support that view that we are indeed in the
early phases of an economic recovery," Chief Executive Kevin
Johnson told investors on a conference call.
For the fourth quarter, Juniper forecast earnings of 23
cents to 26 cents a share, excluding items, and revenue of $860
million to $895 million. The market was expecting earnings of
23 cents a share on revenue of $835 million.
Thursday's numbers appeared to confirm a recovery in
technology spending by U.S. companies including phone and cable
service providers, and Juniper's shares rose 1.4 percent in
extended trade to $28.61 from their close at $28.22.
But some analysts said they were concerned about Juniper's
longer-term strategy after Cisco said last week that it would
acquire wireless gear maker Starent for $2.9 billion -- a deal
seen hurting Juniper's position among wireless providers.
That was followed by Tellabs Inc's TLAB.O announcement
earlier on Thursday to buy wireless infrastructure gear
manufacturer WiChorus for $165 million.
"With Cisco buying Starent and today, losing WiChorus to
Tellabs, the question is what are they going to do about it,
who are they going to partner with," said Forest & Sullivan
analyst Ronald Gruia.
Analysts have predicted more deals in wireless networking
as phone companies upgrade their networks to accommodate more
wireless Internet access. In addition to Cisco, major players
in the wireless equipment space include Alcatel-Lucent SA
ALUA.PA and Ericsson (ERICb.ST).
Juniper's Johnson did not rule out M&A but said the
company's priority was in growing its own technology. Simply
acquiring companies and tacking on products to its own
portfolio would not help customers, he said.
"It's this organic investment in innovation that is the key
value creator for Juniper," he said. "This is not to say that
we will not or do not look at acquisition opportunities. We do
look at them, but we expect organic R&D to be a primary value
(Reporting by Ritsuko Ando; Editing by Richard Chang and Carol