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UPDATE 3-Juniper results show network spending recovering
January 28, 2010 / 9:40 PM / 8 years ago

UPDATE 3-Juniper results show network spending recovering

* Q4 revenue $941.5 mln vs Wall St view for $884.8 mln

* Q4 EPS ex-items 32 cents vs Wall St view for 26 cents

* Sees Q1 rev $880-910 mln vs Wall St’s $873 mln view

* Sees Q1 EPS ex-items 23-26 cents; analysts see 24 cents

* Cites strength in business with AT&T (Recasts with Q1 outlook, adds CEO and analyst’s comment)

By Ritsuko Ando

NEW YORK, Jan 28 (Reuters) - Network equipment maker Juniper Networks (JNPR.N) reported surprisingly strong quarterly results, as customers like AT&T Inc (T.N) boosted infrastructure spending after a year of budget cuts.

Juniper also forecast further improvement throughout 2010 and gave an outlook for the current quarter that was on the stronger side of analysts’ forecasts.

“We’ve come a long way from the economic uncertainty we were facing at this time just a year ago,” Chief Executive Kevin Johnson told analysts on a conference call.

Juniper’s fourth-quarter revenue rose 2 percent from a year earlier to $941.5 million. Analysts, on average, had expected revenue to fall year-on-year to $884.8 million, according to Thomson Reuters I/B/E/S.

Revenue also exceeded Juniper’s own forecast range of $860 million to $895 million.

Johnson said that the recovery in sales was broad-based, but said it won a number of big contracts from service providers. He cited a strong relationship with top U.S. phone company AT&T Inc, although he did not provide details.

Juniper competes with bigger rival Cisco Systems Inc (CSCO.O) in providing network equipment like switches to phone and cable service providers.

Both companies were hit by a decline in telecommunications infrastructure spending in the past year. But they have seen business gradually recover, as customers resumed spending on their networks to support growing online traffic, including wireless access.

Juniper’s fourth-quarter earnings excluding special items was flat from a year earlier at 32 cents a share, comfortably beating the Street’s forecast of 26 cents.

Net income fell slightly to $131.0 million, or 24 cents per share, from $132.5 million, or 25 cents a share, in the year-ago quarter.

Jefferies & Co analyst William Choi had been predicting that Juniper was winning more business from AT&T with its MX routers, but said he was surprised by the quarter’s numbers.

“I think a lot of people might have expected Juniper to outperform, but the magnitude was a surprise,” he said.

For the first quarter, the company forecast earnings excluding items of 23 cents to 26 cents a share and revenue of $880 million to $910 million. The midpoint of those forecasts were higher than Wall Street’s expectations for 24 cents in earnings per share on revenue of $873 million.

Juniper shares have risen around 40 percent from a year earlier. They closed on Thursday at $24.49, down 2.1 percent. (Reporting by Ritsuko Ando; editing by Carol Bishopric, Bernard Orr)

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