Piper Jaffray's Networking Channel Checks are Most Upbeat For Cisco (CSCO); F5 (FFIV) Seeing Asia Weakness

Cisco (NASDAQ: CSCO) saw sequential strength in almost all product categories but security remained the driver, Piper Jaffray's latest checks show. Ruckus' (NASDAQ: RKUS) results were favorable; F5 (NASDAQ: FFIV) was balanced, though there may be some weakness in Asia; and Juniper's (NASDAQ: JNPR) enterprise and security product segments both remained challenged.

Layer 2-3 networking was weaker than the June quarter survey but Cisco saw above plan responses increasing from 33% to 35%, and below plan responses decreasing from 19% to 15%. Juniper (JNPR) saw ongoing weakness in the enterprise. Cisco is benefiting from a switching upgrade cycle and the company is making good strides with cost controls and capital allocation. The CEO’s new initiatives to terminate low margin businesses will help the company see modest margin expansion over time.

Layer 4-7 saw some improvement. 22% of resellers indicated an above plan quarter, up from 15% in the June quarter. F5 feedback was balanced, but some of the larger F5 channel partners, with more global exposure, turned cautious. The Asian market might have been well below expectations for F5 in Sept.

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