Shares of the computer networking supplier Juniper Networks Inc. fell in extended trading today after the company posted mixed second-quarter results, with earnings that missed Wall Street’s forecast and revenue that topped expectations.

The company reported earnings before certain costs such as stock compensation of 42 cents per share on revenue of $1.27 billion for the period, up 8% from a year ago. Wall Street had been looking for higher earnings of 44 cents per share on lower sales of $1.26 billion. Juniper also reported net income for the quarter shot up 83%, t $113.4 million.

Investors reacted badly to the report, with Juniper’s stock falling more than 4% after-hours, having dipped by 1% earlier in the day.

Juniper is a supplier of computer network hardware such as routers and Ethernet switches. It also sells networking software, and provides software tools for securing those networks too.

Juniper Chief Executive Rami Rahim (pictured) said the company exceeded its own revenue forecast during the quarter, and delivered a second consecutive quarter of double-digit, year-over-year product revenue growth.

“Demand signals remain healthy and we are seeing attractive opportunities across our enterprise, cloud and service provider markets,” Rahim added. “Based on this momentum, the backlog we have built, and our latest expectations regarding supply, I am increasingly optimistic regarding our revenue growth prospects for the year.”

Like many technology firms, Juniper’s fortunes this year have been hampered by problems with its supply chain. Three months ago, the company issued a warning that the supply chain challenges it is facing will likely result in extended lead times, as well as elevated logistics and component costs.

In a conference call today, Rahim said those issues have weighed on the company’s growth. He said the availability of certain components remained “extremely challenged” during the quarter due to a meaningful uptick in volume of supplier decommits. As a result, the company has incurred higher costs to secure access to additional parts and get products to customers as fast as possible.

“While some of these actions will impact profitability over the next few quarters, they are also enabling us to access more parts and better satisfy customer demand, which should have positive longer-term implications for our business,” Rahim insisted.

Despite the increased costs it is facing, Juniper did manage to grow its operating margin to 8.5% in the quarter, up from 7% a year ago.

Rahim also addressed concerns over the company’s software business. He said revenue there grew 24% from a year earlier but was still lower than expected. “We believe the outlook for our software business remains strong and we are encouraged by the momentum we’re seeing with our Junos Space Flex software, out-of-the-box subscription software and software-as-a-service offering, such as Mist,” he added.

Looking ahead to the current quarter, Juniper said it expects earnings in a range of 45 to 55 cents per share, the midpoint of which is below Wall Street’s target of 54 cents per share. In terms of revenue, Juniper offered a forecast ranging from $1.3 billion to $1.4 billion versus Wall Street’s forecast of $1.29 billion.

Photo: SiliconANGLE

Show your support for our mission by joining our Cube Club and Cube Event Community of experts. Join the community that includes Amazon Web Services and CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger and many more luminaries and experts.

Source link

Load More By Michael Smith
Load More In Technology
Comments are closed.

Check Also

Dave Vellante’s Breaking Analysis: The complete collection

Breaking Analysis is a weekly editorial program combining knowledge from SiliconANGLE’s th…