Juniper Networks (NYSE:JNPR) reported its third quarter fiscal 2010 earnings this week, hitting a new revenue milestone as technologies including 100 gigabit Ethernet and its Junos Trio chipset entered the market.
For the quarter, Juniper reported revenues of $1.01 billion, an increase of 23 percent over the third quarter of 2009. Wall Street had expected revenue to come in at $1.02 billion, according to Thomson Reuters, which is also the amount that Juniper had provided for guidance during its second quarter analyst call. Net income for the third quarter was reported at $134.5 million, or $0.25 per share.
Moving forward, Juniper CFO Robyn Denholm provided third quarter guidance of $1.12 billion, plus or minus $20 million.
One of the big winners for Juniper during the third quarter was the faster than expected ramp-up of its MX-3D routing platform. The MX-3D was first announced in October of 2009. For the third quarter, Juniper reported that the MX 3D generated $63 million in revenues.
"The MX 3D, is designed with the Trio chips that allows to scale on three dimensions," Juniper CEO Kevin Johnson, said during the company's earnings call. "It can scale on traffic volumes, it can scale on a number of subscribers or users and it can scale on the number of services provided. As a result, we are finding MX 3D as a platform that's engaged in a wide number of scenarios."
Juniper is also continuing to find success with its EX switching business. For the third quarter, Juniper reported that EX revenue was $102 million, up by 100 percent on a year-over-year basis.
"Overall, we continue to deliver great innovation to our customers as evidenced by the success of EX, MX and SRX product families," Denholm said. "This quarter the three product families generated record combined product revenue of $357 million, up 15 percent sequentially and 96 percent year-over-year."
One area where Juniper is aiming to grow its switching and routing business is by way of strategic partners, including IBM and Dell, who both resell and offer OEM versions of Juniper's networking hardware.
With IBM's pending acquisition of Blade Network Technologies, some analysts were concerned about potential impact on Juniper. For his part, Johnson isn't worried and noted that IBM has let Juniper know what its intentions are behind the Blade acquisition.
"The ability to have the Blade-switches that are architected for where IBM is taking their BladeCenter servers is an important element of what IBM is trying to do and we are very supportive of that," Johnson said. "There is a little bit of overlap in the top-of-rack which I don't see as being a significant issue and I think we continue to have a very constructive open dialogue with IBM strategically on where we are going."
Overall, Johnson's hope is that Juniper will continue to have a strong overall working relationship with IBM.
"The overall IBM relationship, whether it's reselling Juniper products or selling the IBM branded version of Juniper products, that overall relationship continues to grow year-on-year," Johnson said. "The OEM element of that though is moving slower. So the bulk of what IBM is doing is still reselling Juniper products, which is fine with us obviously. I think the key points are that our overall strategic alliances are continuing to help grow and help us drive revenue."