SDN takes toll on Juniper Networks
Juniper Networks has announced plans to cut 280 jobs in the fourth quarter, or around 3% of its workforce, even as it revealed it expects its fifth consecutive quarter of earnings growth.
The vendor announced the layoffs in a conference call with investors to discuss its preliminary Q3 results.
Juniper estimates its revenue grew 6% year-on-year during the quarter to $1.18 billion, with a net profit of $99 million.
Operating margins improved to 12.2%, up from 3.8% a year earlier, but stayed relatively flat sequentially.
For the fourth quarter, Juniper expects revenue in the range of $1.2 billion to $1.23 billion – at the low-end of analysts' estimates - and a non-GAAP operating margin of around 22%.
FBR Capital Markets analyst Scott Thompson told Bloomberg that the job cuts and the revenue estimate are a sign that Juniper is being negatively impacted by the industry's transition towards software-defined networking.
The company is also – along with its peers – feeling the pinch of the ongoing decline in telco capex. Ovum expects total spending to drop 10% this year in APAC alone.