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Juniper Networks Profit Falls Yet Tops Estimate

Computer networking gear maker Juniper Networks Inc. (JNPR: Quote) said Tuesday that its first quarter profit fell 87% from last year, hurt by lower revenue and weaker margins.

However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations as did its quarterly revenue. At the same time, the company gave a disappointing outlook for the second quarter.

Juniper shares, which trade in a 52-week range of $16.67 to $40.37, closed the day's regular trading session at $21.63, up $1.46 or 7.24%. The shares are gaining 2.27% in after hours trading.

The Sunnyvale, California-based company reported net income for the first quarter of $16.3 million or $0.03 per share, compared to $129.8 million or $0.24 per share for the year-ago quarter.

Excluding items, adjusted net income for the first quarter was $84.0 million or $0.16 per share, compared to $177.5 million or $0.32 per share in the prior year quarter.

On average, 34 analysts polled by Thomson Reuters expected the company to earn $0.13 per share for the first quarter. Analysts' estimates typically exclude special items.

Reported gross margin for the quarter fell to 61.4% from 66.8% a year ago, while adjusted gross margin shrank to 62.6% from 67.9% last year.

Reported operating margin for the quarter fell to 4.6% from 16.1% a year ago, while adjusted operating margin decreased to 12.0% from 22.3% last year.

Total revenue for the first quarter fell 6% to $1.03 billion from $1.10 million in the same quarter last year. First quarter revenue fell 8% sequentially. Thirty-three analysts had a consensus revenue estimate of $976.84 billion for the first quarter.

Product revenue for the quarter fell 12% to $771.9 million, while service revenue grew 16% to $260.6 million.

Americas revenue declined 9% year-over-year to $531.3 million, while Europe, Middle East, and Africa revenue grew 2% to $299.9 million and Asia Pacific revenue slipped 12% to $194.1 million.

During the first quarter, Juniper repurchased 2.4 million shares of its common stock for a total of $51.6 million.

Looking forward to the second quarter, Juniper forecast revenue of $1.03 billion to $1.06 billion and adjusted earnings of $0.15 and $0.17 per share. Analysts currently expect the company to earn $0.20 per share on revenue of $1.05 billion for the second quarter. Juniper competes with networking giant Cisco Systems Inc. (CSCO) in the router industry.

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by RTT Staff Writer

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