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Juniper Networks Reports Preliminary Second Quarter 2009 Financial Results

  • Q2 Revenue: $786.4 million, up 3% quarter over quarter
  • Q2 Operating Margin: 12.2% GAAP; 18.1% non-GAAP
  • Q2 GAAP Net Income Per Share: $0.03 diluted (reflects a non-recurring income tax charge of $52.1 million, or $0.10 per diluted share)
  • Q2 Non-GAAP Net Income Per Share: $0.19 diluted, up 12% quarter over quarter

Juniper Networks Reports Preliminary Second Quarter 2009 Financial Results

SUNNYVALE, Calif., July 23, 2009 - Juniper Networks, Inc. (NASDAQ: JNPR) today reported preliminary financial results for the three months ended June 30, 2009.

Net revenues for the second quarter of 2009 increased 3% to $786.4 million from $764.2 million reported in the first quarter of 2009 and declined 11% on a year-over-year basis. The Company posted GAAP net income of $14.8 million, or $0.03 per diluted share, and non-GAAP net income of $103.8 million, or $0.19 per diluted share. GAAP net income includes a non-recurring income tax charge of $52.1 million, or $0.10 per diluted share, related to a change in the tax treatment of stock-based compensation in research and development cost sharing arrangements for certain U.S. multinational companies due to a federal appellate court ruling in the second quarter of 2009. Non-GAAP net income per share represents an increase of 12% quarter-over-quarter from the $0.17 per diluted share reported for the first quarter of 2009 and a decrease of 32% from the $0.28 per diluted share reported for the second quarter of 2008. The reconciliation between GAAP and non-GAAP results of operations is provided in a table immediately following the Net Revenues by Reportable Segment table below.

"We continue to take a disciplined approach to controlling operating expenses as we navigate this challenging economic period,” said Kevin Johnson, Juniper’s chief executive officer. “With service provider sales relatively flat quarter-over-quarter, our sequential revenue increase was supported by double digit quarter-over-quarter growth in the enterprise market. A solid product portfolio, compelling value proposition, and improved sales and marketing execution are enabling us to expand and diversify our customer base."

Juniper’s operating margin for the second quarter of 2009 increased to 12.2% on a GAAP basis from 10.6% in the first quarter of 2009, and decreased from 18.3% in the prior year second quarter. Non-GAAP operating margin for the second quarter of 2009 increased to 18.1% from 16.4% in the first quarter of 2009 and decreased from 23.6% in the prior year second quarter.

Juniper generated net cash from operations for the second quarter of 2009 of $148.7 million, compared to net cash provided by operations of $163.9 million in the first quarter.

Capital expenditures as well as depreciation and amortization expense during the second quarter of 2009 were $45.2 million and $37.8 million, respectively.

"Juniper continues to execute well and deliver on its commitments to improving our overall cost structure and driving operational excellence, and this translated to higher earnings and good free cash flows in the second quarter,” said Robyn Denholm, Juniper’s chief financial officer. “As we move forward, we will maintain our focus on balancing our long term investments in our product roadmap as well as operating as leanly and efficiently as we can as a company."

Juniper Networks will host a conference call web cast today, July 23, 2009 at 1:45 p.m. (Pacific Time), to be broadcasted live over the Internet at: https://www.juniper.net/company/investor/conferencecall.html .

To participate via telephone, in the U.S. the toll free dial-in number is 877-407-8033; outside of the U.S. dial 201-689-8033. Please call ten minutes prior to the scheduled conference call time. The webcast replay of the conference call will be archived on the Juniper Networks website until September 14, 2009.

About Juniper Networks

Juniper Networks, Inc. is the leader in high-performance networking. Juniper offers a high-performance network infrastructure that creates a responsive and trusted environment for accelerating the deployment of services and applications over a single network. This fuels high-performance businesses. Additional information can be found at www.juniper.net.

Juniper Networks, JUNOS and the Juniper Networks logo are registered trademarks of Juniper Networks, Inc. in the United States and other countries. All other trademarks, service marks, registered trademarks, or registered service marks are the property of their respective owners.

Statements in this release concerning Juniper Networks' business outlook, future financial and operating results, and overall future prospects are forward-looking statements that involve a number of uncertainties and risks. Actual results could differ materially from those anticipated in those forward-looking statements as a result of certain factors, including: general economic conditions globally or regionally; business and economic conditions in the networking industry; changes in overall technology spending; the network capacity requirements of communication service providers; contractual terms that may result in the deferral of revenue; increases in and the effect of competition; the timing of orders and their fulfillment; manufacturing and supply chain constraints; ability to establish and maintain relationships with distributors and resellers; variations in the expected mix of products sold; changes in customer mix; changes in geography mix; customer and industry analyst perceptions of Juniper Networks and its technology, products and future prospects; delays in scheduled product availability; market acceptance of Juniper Networks products and services; rapid technological and market change; adoption of regulations or standards affecting Juniper Networks products, services or the networking industry; the ability to successfully acquire, integrate and manage businesses and technologies; product defects, returns or vulnerabilities; the ability to recruit and retain key personnel; significant effects of tax legislation and judicial or administrative interpretation of tax regulations; currency fluctuations; litigation; and other factors listed in Juniper Networks’ most recent report on Form 10-Q filed with the Securities and Exchange Commission. All statements made in this press release are made only as of the date set forth at the beginning of this release. Juniper Networks undertakes no obligation to update the information in this release in the event facts or circumstances subsequently change after the date of this press release.

Juniper Networks believes that the presentation of non-GAAP financial information provides important supplemental information to management and investors regarding financial and business trends relating to the company's financial condition and results of operations. For further information regarding why Juniper Networks believes that these non-GAAP measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the discussion below.