Juniper Networks (NYSE: JNPR) is feeling the pain of its major telco customers putting off their purchasing decisions for its routing products as the vendor reported that Q1 2012 net revenue declined 6 percent on a year-over-year basis and 8 percent sequentially to $1.03 billion.
However, non-GAAP net income of 16 cents per share surpassed analysts' forecast of 13 cents, according to Thomson Reuters. Revenues beat the consensus of $976.84 million.
The vendor's net profit also fell to $16.3 million, or 3 cents per share, from $129.8 million, or 24 cents per share, in Q1 2011.
A similar situation emerged in Q4 2011 where net revenues declined 6 percent year-over-year as a result of weaker than expected service provider spending.
Looking forward, Juniper forecast Q2 2012 adjusted earnings of 15-17 cents per share on revenue of $1.03 billion to $1.06 billion on hopes of sales of its new core router and switching products--the T4000 and PTX. Analysts polled by Thomson Reuters I/B/E/S forecast Juniper Q2 2012 earnings of $1.05 billion.
Of course, the key concern that about the vendor's Q2 prospects will center on whether its large telco customers like AT&T (NYSE: T) will up their spending in the next quarter. Service providers make up 65 percent of the vendor's revenue mix.
AT&T, which also reported its Q1 2012 earnings on Tuesday, cut its wireline capex spending 14 percent during the quarter.
"Service providers continue to be thoughtful with their spending," a company executive said on a post-earnings call with financial analysts.
Juniper's shares closed at $21.63 at the close of trading on the New York Stock Exchange.
For more:
- see the earnings release
- Reuters has this article
Special report: Wireline in the first quarter of 2012
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