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Allot Communications Ltd. (ALLT) Message Board

  • petercohen33 petercohen33 Oct 23, 2013 2:48 PM Flag

    Juniper adds to post-earnings losses, peers also off

    •The soft Q4 top-line guidance provided with Juniper's (JNPR -5.9%) Q3 beat has led shares to fall below $20. Several peers are also off on a down day for tech: FFIV -4.3% (reporting after the close). DRWI -3.9%. PKT -2.8%. RKUS -2.6%. CIEN -2.4%. RVBD -2.2%.
    •On its CC, Juniper attributed its guidance to U.S. federal weakness caused in part by the government shutdown, and called the macro environment "dynamic." The company also disclosed it's cutting another 280 jobs (~3% of its workforce) in Q4, and that it's in the "later stages" of its search for a replacement for departing CEO Kevin Johnson.
    •Some of the job cuts are related to Juniper's decision to kill off its MobileNext 3G/4G infrastructure software line.
    •The sell-side is nervous about declining enterprise sales, caused in large part by security share losses. Juniper promises a resumption of security growth in 2014; favorable comps should make that easier.
    •Carrier routers continue to be a bright spot: MX series edge router sales rose 15% Q/Q, and core router sales 11% Q/Q. Both Cisco and Juniper have been seeing strong edge router demand in recent quarters.
    •Juniper also states it's seeing healthy carrier demand in all three major geographies. However, Americas demand is generally stronger than EMEA and Asia-Pac demand.

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    • •The sell-side is nervous about declining enterprise sales, caused in large part by security share losses. Juniper promises a resumption of security growth in 2014; favorable comps should make that easier.

    • Thanks, Peter

      • 1 Reply to hawkfaminhudson
      • To me, he's putting a positive spin on a troubling trend: Product revenue is tougher to come by, so F5 is investing in services to squeeze more from current customers and increase billings from every new engagement.

        F5 needs the juice. Q4 product revenue inched up just 1.2%, which means consulting accounted for virtually all of F5's top line growth. For the full fiscal year, product revenue fell 2.4%.

        Cisco's team-up with Citrix Systems to deliver more F5-style application delivery functionality to their customers appears to have taken a huge toll. Enhanced consulting services and more security products are the company's way of fighting back.

        The battle is a long way from over, and unfortunately for F5 investors, a win is anything but assured.

 
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