Juniper Reports Q3 Inline, Street Unimpressed Thus Far

October 19th, 2010 by · Leave a Comment

The market does not appear to be particularly forgiving at the moment when it comes to telecom equipment stocks.  Routing giant Juniper Networks (NASDAQ:JNPR, news, filings) reported its third quarter earnings today, and its stock is of course down 3% after hours even after being down 4% in anticipation.  The reason?  Well, Q3 revenue was ever so slightly light but Q4 revenue guidance was actually above estimates.  Likewise, earnings per share was inline and Q4 guidance was a bit above estimates.  Here’s a quick table of Juniper’s numbers in the context of the full year:

Q1/09 Q2/09 Q3/09



Revenue $912.6M $978.3M $1012.4M $1100-1140M
EPS (non-GAAP) 0.27 0.30 $0.32 $0.35-0.37
Operating Margin (non-GAAP) 23.2% 23.9% 24.1%

While Infinera’s Q4 outlook shook some investors yesterday, there appears to be no similar lack of visibility for Juniper over in the routing space.  According to CFO Robyn Denholm: “We exited this quarter with strong demand metrics and good momentum and we are on track to deliver 20% or higher revenue growth for the full year.”

So why is the market so skittish?  Well, I suppose the equipment space can turn on a dime, and they know it – and are very wary.  Can’t blame them I guess, but there seems much less room for capex games at carriers right now.  I don’t get the sense that the timing of bandwidth upgrades is as negotiable as was the case at the end of 2008, even if the economy should turn south.

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Categories: Financials · Telecom Equipment

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