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Juniper Networks, Inc. Reports Q2 '00 Financial Results Net Revenue $113.0M; Pro forma EPS $0.08

Sunnyvale, CA - July 13, 2000 - Juniper Networks, Inc. (Nasdaq: JNPR), a leading provider of next-generation IP infrastructure systems, today reported its second quarter results for the period ending June 30, 2000.

Net revenues for the second quarter were $113.0 million, compared with $63.9 million for the first quarter, an increase of 77%. Pro forma net income, which excludes the amortization of goodwill of $1.9 million, the deferred compensation charge of $458,000 and a one time charitable contribution charge of $10.0 million, was $28.6 million or $0.08 per share, compared with a pro forma net income of $10.5 million or $0.03 per share in the first quarter of 2000.

Actual net income for the second quarter, including the above-mentioned amortization of goodwill, deferred compensation and charitable contribution charges, was $19.6 million or $0.06 per share, compared with $8.1 million or $0.02 per share in the first quarter of 2000.

Net revenues for the first six months of 2000 were $176.9 million, compared with $27.6 million for the same six month period in 1999. Pro forma net income for the first six months of 2000 was $39.1 million or $0.11 per share, compared with pro forma net loss of $8.7 million or $(0.09) per share during the same six month period in 1999. Actual net income for the first six months of 2000 was $27.7 million or $0.08 per share, compared with actual net loss of $10.5 million or $(0.11) per share during the same six month period in 1999.

The net income per share and number of shares used in the per-share calculation for all periods presented reflect the two-for-one stock split that was effective June 16, 2000.

"As we continue towards the next milestone in building Juniper Networks into a franchise, we remain focused on relentless execution," said Scott Kriens, Chairman and CEO of Juniper Networks. "Our results this quarter are representative of the opportunity we see to build the global IP infrastructure," Kriens said.

About Juniper Networks, Inc.

Juniper Networks, Inc. is a leading provider of purpose-built systems that meet the scalability, performance, density, and compatibility requirements of rapidly evolving, optically enabled IP networks. The company's purpose-built systems provide new IP infrastructure solutions for the world's leading service providers. Juniper Networks service, manufacturing teams, and IP engineers work closely with customers to build and support customer networks. The company is headquartered in Sunnyvale, California. For more information, please visit the Web site at https://www.juniper.net.

JUNIPER NETWORKS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)
    June 30,
2000
  December 31,
1999
     
Assets (unaudited) (1)
Current assets:    
  Cash and cash equivalents
$ 797,125
$ 158,043
  Short-term investments 384,764 187,915
  Accounts receivable, net 60,733 23,950
  Prepaid expenses and other current assets 15,792 7,925
     
    Total current assets 1,258,414 377,833
Property and equipment, net 28,397 12,416
Long-term investments 412,374 97,201
Other long-term assets 131,167 25,928
     
   Total Assets
$ 1,830,352
$ 513,378
     
 
Liabilities and Stockholders' Equity    
Current liabilities:    
  Accounts payable
$ 37,914
$ 15,368
  Other accrued liabilities 67,044 21,025
  Deferred revenue 30,872 19,270
     
    Total current liabilities 135,830 55,663
Convertible subordinated notes and other long-term liabilities 1,165,725 -
 
Common stock and additional paid-in capital 530,157 513,698
Deferred stock compensation (2,010) (3,001)
Accumulated other comprehensive income (loss) 25,129 (815)
Accumulated deficit (24,479) (52,167)
     
   Total Liabilities and Stockholders' Equity
$ 1,830,352
$ 513,378
     
 
(1) Derived from audited financial statements


JUNIPER NETWORKS, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (i)

(In thousands, except per share amounts)

    Three Months Ended
June 30,
  Six Months Ended
June 30,
     
  2000   1999 2000   1999
     
  (unaudited) (unaudited)
 
Net revenues
$ 113,028
 
$ 17,556
$ 176,914
 
$ 27,600
 
Cost of revenues 40,752 8,046 65,853 14,393
     
 
Gross profit 72,276 9,510 111,061 13,207
 
Operating expenses:  
  Research and development 18,000 7,991 33,990 14,172
  Sales and marketing 17,247 3,849 28,752 6,452
  General and administrative 4,171 977 7,185 1,753
     
    Total operating expenses 39,418 12,817 69,927 22,377
     
 
Operating income/(loss) 32,858 (3,307) 41,134 (9,170)
 
Interest income, net 9,876 448 16,512 560
     
 
Income/(loss) before income taxes 42,734 (2,859) 57,646 (8,610)
 
Provision for income taxes 14,102 102 18,552 122
     
 
Net income/(loss)
$ 28,632
$ (2,961)
$ 39,094
$ (8,732)
     
 
Basic net income/(loss) per share
$ 0.09
$ (0.03)
$ 0.13
$ (0.09)
     
Shares used in computing basic
net income/(loss) per share
301,879 107,292 298,712 98,616
     
 
Diluted net income/(loss) per share
$ 0.08
$ (0.03)
$ 0.11
$ (0.09)
     
Shares used in computing diluted
net income/(loss) per share
346,411 107,292 346,102 98,616
     
 
(i) The statements exclude the impact of the amortization of goodwill and deferred stock compensation and charitable contribution charges in all periods.


JUNIPER NETWORKS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

    Three Months Ended
June 30,
  Six Months Ended
June 30,
     
  2000   1999 2000   1999
     
  (unaudited) (unaudited)
 
Net revenues
$ 113,028
 
$ 17,556
$ 176,914
 
$ 27,600
 
Cost of revenues 40,752 8,046 65,853 14,393
     
 
Gross profit 72,276 9,510 111,061 13,207
 
Operating expenses:
  Research and development 18,000 7,991 33,990 14,172
  Sales and marketing 17,247 3,849 28,752 6,452
  General and administrative 4,171 977 7,185 1,753
Goodwill and deferred stock compensation 2,315 891 4,706 1,795
  Charitable contribution 10,000 - 10,000 -
     
    Total operating expenses 51,733 13,708 84,633 24,172
     
 
Operating income/(loss) 20,543 (4,198) 26,428 (10,965)
 
Interest income, net 9,876 448 16,512 560
     
 
Income/(loss) before income taxes 30,419 (3,750) 42,940 (10,405)
 
Provision for income taxes 10,802 102 15,252 122
     
 
Net income/(loss)
$ 19,617
$ (3,852)
$ 27,688
$ (10,527)
     
 
Basic net income/(loss) per share
$ 0.06
$ (0.04)
$ 0.09
$ (0.11)
     
Shares used in computing basic
net income/(loss) per share
301,879 107,292 298,712 98,616
     
 
Diluted net income/(loss) per share
$ 0.06
$ (0.04)
$ 0.08
$ (0.11)
     
Shares used in computing diluted
net income/(loss) per share
346,411 107,292 346,102 98,616