Juniper Networks (JNPR) Tops Q2 EPS by 1c, Revenues Beat; Offers 3Q Revenue Mid-Point Guidance Above Consensus

Juniper Networks (NYSE: JNPR) reported Q2 EPS of $0.35, $0.01 better than the analyst estimate of $0.34. Revenue for the quarter came in at $1.08 billion versus the consensus estimate of $1.05 billion.

“We experienced solid demand during the June quarter, as our combination of technological differentiation and go- to-market execution drove a second consecutive quarter of positive order growth,” said Juniper’s CEO, Rami Rahim. “While the global macro environment remains uncertain, the strategic importance of the global network has never been clearer and we remain confident regarding the long-term outlook for our business.”

“We delivered better than expected results during the June quarter, with both revenue and non-GAAP earnings per share exceeding the mid-point of our guidance,” said Juniper’s CFO, Ken Miller. “We are entering Q3 with healthy backlog and are optimistic regarding our ability to navigate COVID-19 related supply chain challenges and deliver improved profitability during the upcoming quarter.”

GUIDANCE:

Juniper Networks sees Q3 2020 EPS of $0.38-$0.48, versus the consensus of $0.43. Juniper Networks sees Q3 2020 revenue of $1.075-1.175 billion, versus the consensus of $1.1 billion.

These metrics are provided on a non-GAAP basis, except for revenue and share count. Non-GAAP earnings per share is on a fully diluted basis. The outlook assumes that the exchange rate of the U.S. dollar to other currencies will remain relatively stable at current levels.

At the mid-point of our Q3 guidance we expect to see sequential revenue and earnings growth. Confidence in our forecast is driven by strong backlog and strength within our Service Provider and Cloud verticals. We believe these factors should help offset continued uncertainty in parts of the Enterprise market.

We expect to see sequential volume-driven improvements in non-GAAP gross margin and a more favorable customer mix during the September quarter. We expect logistics and other supply chain-related costs to remain elevated, consistent with Q2 levels, due to the effects of the ongoing pandemic.

We expect third quarter non-GAAP operating expense to be essentially flat compared to Q2, as we continue to benefit from lower travel costs due to COVID-19. We will remain focused on prudent cost management while continuing to invest to capture future opportunities.

Our Board of Directors has declared a cash dividend of $0.20 per share to be paid on September 22, 2020 to shareholders of record as of the close of business on September 1, 2020. We remain committed to paying our dividend and will remain opportunistic with respect to share buybacks.

Our guidance for the quarter ending September 30, 2020 is as follows:

• Revenue will be approximately $1,125 million, plus or minus $50 million.
• Non-GAAP gross margin will be approximately 59.5%, plus or minus 1.0%.
• Non-GAAP operating expenses will be approximately $478 million, plus or minus $5 million.
• Non-GAAP operating margin will be approximately 17% at the mid-point of revenue guidance.
• Non-GAAP tax rate will be approximately 19.5%.
• Non-GAAP net income per share will be approximately $0.43, plus or minus $0.05. This assumes a share count of approximately 334 million.

For earnings history and earnings-related data on Juniper Networks (JNPR) click here.

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