Juniper Networks has exceeded analyst expectations for its preliminary fourth quarter (Q4) results of 2024, benefitting from steady demand for its networking equipment, particularly in the wake of the growing AI boom. The networks firm posted revenues of $1.4bn for the reported quarter, slightly surpassing the consensus estimate of $1.38bn. This marks a 3% year-on-year (YoY) growth. The company’s adjusted earnings per share (EPS) of $0.64 also came in ahead of analyst expectations, which had forecasted $0.57. The strong results reflect the continued strength in demand, particularly from cloud computing companies that are heavily investing in infrastructure to support AI and data centre initiatives.
The cloud vertical saw notable growth, driven by significant investments in AI networking infrastructure. Juniper’s solutions are said to play a critical role in optimising data traffic across large-scale networks, which is in high demand as businesses increasingly turn to AI to manage complex data processing. This focus on AI networking contributed to a substantial rise in backlog, which increased by 30% compared to the same period last year. The growth in cloud demand, bolstered by AI initiatives, was a major driver for the company’s performance in Q4.
For the full year 2024, Juniper reported net revenues of $5.07bn, a decline of 9% compared to 2023. Non-GAAP net income for the year stood at $574.5m, resulting in diluted EPS of $1.72, which represents a 24% YoY decline. Despite the decrease in total revenues, Juniper showed improvements in key areas, particularly with its non-GAAP operating margin, which stood at 14.2%, down from 16.9% in the previous year.
“I am particularly pleased by the breadth of the momentum we are seeing, as we saw double-digit order growth in our enterprise and service provider verticals complement another quarter of triple-digit year-over-year growth in our cloud vertical, where we continue to benefit from these customers’ AI networking initiatives,” said Juniper CEO Rami Rahim. “I believe these results reflect the strong execution of our teams and the strength of our AI-native networking solutions, which continue to win across customer verticals and set us up well to deliver sustainable growth on a go forward basis.”
Legal challenges and merger concerns
Despite the positive financial performance, Juniper faces regulatory challenges regarding its ongoing acquisition by Hewlett Packard Enterprise (HPE). Last week, the US Department of Justice (DOJ) filed a lawsuit to block the $14bn deal, citing concerns about reduced competition in the enterprise wireless networking sector. The DOJ argues that the merger would stifle innovation and lead to higher prices, particularly in the crucial market for business and institutional network infrastructure. Conversely, Juniper’s acquisition by HPE has been approved by the UK’s Competition and Markets Authority (CMA), which gave its green light to the deal in August 2024. Before this, the deal was unconditionally cleared by the European Commission (EC).
Read more: UK CMA clears HPE’s $14bn acquisition of Juniper Networks
