Juniper's Q4 2013 revenues jump 12 percent to $1.3B on strong service provider, enterprise sales
Juniper Networks (NYSE: JNPR) reported that fourth-quarter 2013 earnings rose 12 percent year-over-year to $1.3 billion, slightly beating its guidance of $1.20 billion to $1.23 billion due to a rise in service provider and enterprise sales.
Service provider sales rose 12 percent year-over-year to $827 million, up from $739.4 million in the fourth quarter of 2012, while Enterprise revenues rose 11 percent year-over-year to $446.6 million.
Robyn Denholm, CFO and executive vice president for Juniper, said during the earnings call that its service provider results were driven by strong sales to cable operators and content providers.
"While the growth was across all customer segments, content and cable were the key drivers," Denholm said. "It is worth noting that over 50 percent of the total revenue growth in 2013 came from the web services content and cable customers."
Routing and switching revenue both rose year-over-year to $603.3 million and $198.7 million from $513.7 million and $145.8 million, respectively.
Rami Rahim, executive vice president and general manager of the Platform Systems Division for Juniper Networks, said the two star performers in its product portfolio were the MX and the PTX.
"The particular applications here that we're driving are convergence of Edge and aggregation networks to simplify operations for our customers, data center interconnect to connect clouds together," Rahim said. "And then the other area where we saw some real strength from a booking standpoint is in PTX. As you know, PTX is somewhat of a different architectural approach. So the sale cycles are long and what we're seeing now are the results of the design wins that we had several quarters ago now turning into sales."
Rahim added that the company broadened the appeal of the MX product line to serve the needs of regional service providers with the new MX104 platform.
"The MX104 takes all of the sophisticated capabilities of the MX down to a very small power-efficient form factor that's ideal for smaller operators and now into the access navigation part of the network," he said.
From a regional standpoint, Americas Service Provider revenue rose 6 percent year-over-year to $685 million. Likewise, Americas Enterprise rose 16 percent sequentially and 29 percent year-over-year, due to strong sales of routers and switches in the financial and federal government sectors.
Driven by strong service provider results in Germany, U.K. and Eastern Europe, EMEA revenue rose 6 percent year-over-year to $358.9 million from $338.6 million. In Asia, growth in both Service Provider and Enterprise revenues drove up revenue 18 percent year-over-year to $229.7 million.
Denholm said that "while we are encouraged by the performance in the quarter, there's still some work that needs to be done to get the region growing on a more consistent basis."
The vendor's operating margin also increased to 15.3 percent, and the adjusted operating margin rose to 21.9 percent from 18.2 percent. Net income was $151.8 million or 30 cents per diluted share, up from $95.7 million, or 19 cents a share year-over-year. These results included 4 cents a share restructuring charge related to its move to cut 280 jobs during the quarter.
Looking forward, the vendor has forecast revenues of $1.12 billion to $1.16 billion and adjusted gross margin of 64.0 percent plus or minus 0.5 percent.
Shares of Juniper were listed at $27.30, up $1.29 or 4.96 percent, in pre-market Friday morning on the New York Stock Exchange.
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