JNPR - Earnings call transcript Q1 2022

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Operator

Good afternoon, ladies and gentlemen, and welcome to the Juniper Networks First Quarter 2022 Financial Results Conference Call. At this time, all participants have been placed on a listen-only mode and we’ll open the floor for your questions and comments after the presentation. It’s now my pleasure to turn the floor over to your host, Jess Lubert. Sir, the floor is yours.

Jess Lubert

Thank you, operator. to quarter welcome conference and afternoon, our XXXX first call. Good

statements in Chief today SEC and and furnished CFO might discussed today Today’s and with These forward-looking and XX-Q, and current uncertainties, are other to me recent are our Executive These risks materially. call results on statements most expectations. Rami certain Officer. Joining risks Financial Rahim, the filed Officer; in subject our Chief commentary filings. our Ken contains actual based are X-K differ our press release, Miller,

Our Juniper forward-looking forward-looking to statements statements. speak no any only as of today, update undertakes and obligation

Our discussion in why today’s non-GAAP financial information Relations can Investor section included information today of of results a our is useful we Reconciliation consider view Financial will the on non-GAAP results. website company’s press found Commentary the financial be in under release. include Reports.

Following that will possible our please question will the to you we ask I to chance. yourself one have over to questions. call many turn that ask a a as With take We prepared would like remarks, that, question now people so limit Rami. who as

Rami Rahim

and everyone, call discuss for QX joining thank us to on XXXX today’s results. you our afternoon, Good

have in on colleagues I’d Belarus. the provide begin, war, within affected region impacted. Russia those and like suspended services thoughts those the Before been I all are all When we our quickly and invasion a and the loved brief to of statement Russian with My war tragic who sales ones Ukraine. by particularly began, with this

to the Juniper and efforts to the support hope help for vital contributions in region. made closely to we’re and donation and and its complexity its UNICEF made the humanitarian the safety. situation of employees peace the Given events, Foundation a Ukraine, the continuing the restoration work Juniper in meantime, of In to monitor

per share we supply year-over-year, the from challenges of guidance, accelerated earnings a quarter, and QX despite results. chain to midpoint Turning our delivered met we non-GAAP continued the strong perspective. Revenue growth

on our quarter to timing supply of our entirely with estimated as of to customers of result challenges. the order in vertical, in network account a delight to delivering quarter is noteworthy, continue due Demand was growth double-digit to placing experience company’s the teams revenue focused vertical. of chain their only particularly seen Cloud benefited we service largest unadjusted simplify of more of nearly but and increased a with which basis, order double-digit This year-over-year certain This and which network our that evidenced cloud, across large all to across growth was are first year-over-year. March a for an when not double-digit more enterprise we history year-over-year, remained networking, ending verticals quarter, an orders both and categories our orders the and growth QX year-over-year meaningfully was all normal in customer resonate adjusted have saw solutions Our times. than for users, strong results, fourth by account orders decline performance customer and in also markets customer what’s offset backlog momentum it ahead what enterprise serve. exceptional the call XX% the from execute strong of life strong business, year-over-year. extremely to rate continues performance in each grew provider shipments and enterprise On which sequential extended consecutive lead well first Order basis. enterprise strength to a solutions, Juniper’s experiencing these by year-over-year grow is as modest on XX% than operators each the

organizations, been go the importance engineering, product continued strong market more customer transformation execution to our and clear, and and demand core office has upgrade which some customer believe see never is enabling our include provider of of our customer us we healthy each that to across broad the patterns management, While architectures. cloud-based service these capitalize XXX-gig digital reflect where spending across to and and enterprise investments reopening much to of strong project, strength of verticals, is on of network at adoption network the this the attributable initiatives. significant Examples cloud associated customers, services of initiatives

points regarding the the enter challenges we backlog despite improve we extremely momentum the developed to transitory in and strong well XXXX. still year, margin up momentum prove we have of Based various current is our these facing. deliver regarding and the sets are As challenges least still optimistic the for X% a the momentum, recent are in and X growth targeting are I we’re sales strong and supply expansion our profitability I level, June to operating on X% chain and beyond. likely assumptions us we backlog expect to deliver and order believe at quarter, non-GAAP timeframe solid remain prospects XXXX and to to growth supply, continue seeing order

for normal to situation work and returns supply backlog we’re supply the long-term expectations the to that and XXXX assume down once more for levels. unable during business improves Our creating current chain chain persist, our tailwind year, challenges potentially backlog

families all offerings. shipments, exceptionally the timing least MX, all major our remains these experienced perspective. QX this we developments additional some we’re modest of for due key Now, at double-digit entirely and customer to product from insight only and verticals Automated across I’d set with provide solutions revenue solution into solutions growth as year-over-year, order some ACX a the growth including experienced WAN, strong address demand Starting like to PTX seeing quarter customer while and

line see product and particularly our We’re interest five leverages X a years. in of service recent our see any tailwind latest over quarter, product In continuing building launched MXXXk adoption I experienced XX-terabit, years. LCXXXX XXX-gig provider family this with cloud point, our record several card, to strong quarter was our XXX-gig which our which new present of our next Trio the the momentum should this customers, strong to encouraged To strongest business for silicon over last several solutions. most WAN WAN newer the and Automated experienced Automated capable programmable early

and to our products saw to our potential Paragon and market and capitalize also demand of Express PTX requirements. also of ability leveraging optimistic quarter year, growth software. our ACS solutions, new Edge, our Metro X our With additional customers the next long-term portfolio, expected new and Automation products launch next our regarding triple-digit silicon on quarters, for am order X I growing MX several Automated Metro for another to WAN coming next ACX generation We Trio and growth offerings Metro over the based Core,

due as solutions cloud-ready geographies. the momentum we’re certain customers, provider seeing to center base Our major customer data verticals the and service March broad during year-over-year growth were cloud revenue quarter strength due Orders with exceptionally strong well across experienced accounts. in to XX% QX as

center solutions XX software data switching which the are wins the generating deal XXX-gig ready the that portfolio interest capabilities to Customer Our switching we’re to enterprise, is and secured we in the provider. remains meaningful years. top is clouds several years. opportunities span resonating I center now than in growth strength within next our accounts. majors, data high to data already likely cloud market few revenue and secured, market centers meaningful our have this capitalize drive believe regarding and optimistic and we’ve with is over cloud and our next given on increasingly orders across new ability This more XX a opportunity, One systems data already center win speaks of a provider the service over the attractive

Mist-ified revenue more the $XXX to our portfolio, wired in exceptional due doubled we million enterprise grew new XXX% to EX strength than QX, annualized continued and surpassed see existing year-over-year, a both wireless outpace level. through continue with and AI-driven XX% the switching to This market momentum revenue revenue Our run at logos. to related year-over-year. led customers was as and which the the order year-over-year materially by business success flow Mist-ified growing record rate

to Mist engine, effectively, ability cloud, industry’s a smallest Juniper to a the micro swapping out are leverages quickly Marvis business The the and are problems, the reminder, remediate rapidly and modern AI-driven to customer services introduce IT all customer to across As competition of proven reduce to leading enhancing new on to sizes cost Assistant customers the helpdesk improve Mist largest a and Virtual tickets, environments. Network AI among scale standardizing services operations the reasons AI.

based Juniper known, such delivered these also services incredibly location-based is Mist industry-leading certain of verticals important capabilities AI, on to as which are retail. many While well

our native accelerate frustrated network solutions, and we both leader will to are believe for leaders many to deploy Gartner only to expensive strong Mist-ifying with highly WiteSand, by readied for access Magic process Technology for overlooked, best point ability services, also cloud that solution. a prove not continuing services, which and enterprises, Juniper on-prem location-based to demand. provide and us solution. believe we experience XXX both this this And has of acquired our Quadrant this industry’s making mist our return solution private existing of Quadrant a validation are wireless make QX will talents the XXXX, We’re expected The work. grown wired in Mist is Recognizing to a access to the exceptional of lead, interest company customers, vendor offices and control seeing development they cloud. that as to to progress to differentiation, SD-WAN important attractive make small which as is AI we further recently client lifted We difficult secure is our their critical the connectivity likely further from location-based Despite we In manage. and differentiation. to invest to of which benefit completion an cement our be from continue assured

Europe. the enterprise We our validation, US wins XXX enterprises highly AI financial services party regarding the is be order in XXX the by technical business. the of driven remain recent our with superiority of Technology experiencing outlook momentum enterprise and AI-driven Fortune momentum, large organizations that our Based the in with on and portfolio, third confident continue to encouraged recent I

of security Our top fifth all to our My of by independent in with company, rate firewall slightly XXX% leading give efficacy but growth cyber will for our security that we and only achieved serve performance a expect products, strategic ICSA, XXX% all other revenues that convergence continue a increase in and networking were us results of and but year-over-year, Customers I detection business. I competitive ongoing ranked telling declined security against difficulties, advantage recently geopolitical cases. peers. a is ever, use testing consecutive quarter present more the Juniper a the I’m unique by light markets this is will for customer which security third-party one threats confident believe confidence the effectiveness QX with are than number important fueled of this advantage. across competitive security that in

Importantly, continue better to of a progress offerings, the our of our business software-centric to and more turn-based our radical make to sales model organization software to offering stack. by more licenses, training introducing perpetual transitioning transforming our subscription we value more monetize

While of services these another XX% our for encouraging innings, by saw the momentum related in to XX% year-over-year in and total quarter experienced of remain revenue. account efforts total the which early we revenue grew timeframe, software QX

increasing were in period year-over-year. orders more Software by strong XX% than the also

security solely recurring and year-over-year, subscriptions. due Our for consists and revenue, ratable the strong demand which increased related XX% subscriptions of to services, Mist truly software annualized

in not We’re only encouraged critical but more progress to our stickiness improving we’re also revenue, making software customer growth, view efforts margin. by accelerating to as we the which and capture

renewal team services strong delivered impressive due attach services quarter and to another rates. Our

record margin. In addition to revenue, delivered also service strong we

to the extremely experience. but that Our cloud automation margin continues well and innovation insights benefit not execute it’s only new services driving also revenue on organization delivered create through focused and and opportunities, customer

provide to update and optical efforts, compared validated traditional focused component an Photonics as integration in market cost power like integrated we’ve Through optical and our advantages the hybrid superior and through AI, the on which opportunity on Silicon in working that had market. laser closely LiDAR I’d Now result to efficiency unmatched lower been beyond. disrupting would and and broad center with technology disaggregation the solutions market the of customers data our and with partners, our networking investment, applications

on an has new could are created leader deep to as that will They of if licensing to have and order Synopsys of learned on array a best design be this opportunity can a customer we in partner address ecosystem believe we capitalize set, this a volume the partners as new this in large would and discrete full and derive property economics. design. Photonics. intellectual a interest technology foundry new acquired However, Silicon realized majority both bring the the this We open that opportunity company, integrated platform of through broad ideal target broader better In sales technology be they to licensing that for launched has enable company to Silicon first potential opportunities company. equipped and semiconductor models. launch components presence, this the entity expertise Photonics we

in also entity will ownership will interest its the the future product as us to maintain an as new We allow benefit financial well that from business’s success.

thank the navigate in maintain to to shareholders call the employees who continued organizational without organization Chief the James, confidence last especially may has is he’s noticed for their in results for I’m have for discuss and disruption. the dedication, President to Executive I work Marcus Vice sales on the turn and role essential decided any thanks opportunity. partners the detail. Juniper. the over basis. like talent thank will Revenue our will hard want Juniper excellent financial tools I’d to more and my Ken, customers, have will shape value Customer you I I we few their a Jewell, our extend made company like transition and to stakeholders. years. Officer, to to Finally, interim services an for the to Marcus our our his and our announcements to over Derrell in leaves and quarterly our which that confident our now Experience, would for assume momentum creating support and of Marcus new leave contributions

Ken Miller

midpoint Thank our some you, XXXX first share start year-over-year million ended $X,XXX Rami, across with with than year-over-year. remained strong verticals and the growth, greater orders by revenue, and up first earnings $X.XX, XX% in saw will color year-over-year guidance our outlook. good and in customer digit in guidance afternoon, quarter, GAAP first per everyone. growth end I were and our solutions. double quarter discussing increased We line the Non above results quarter Product year-over-year. order on our X% again we all at posting the and of X% of and

to adjusting large certain of product extended orders grown normal industry Some challenges, of continues strength this estimated these order ahead rate double-digits year. for versus early in the attributable are lead chain to last time. have their account supply orders placing order be orders After for customers total resulting to for to customers,

backlog Our a increased million $XXX more on than sequential basis.

we driven year-over-year. year-over-year solutions Looking increased ready a center cloud at of revenue our in saw XX% on AI year-over-year, increased revenue XXXX, growth areas XX% by WAN data enterprise Automated and revenue customer versus quarter basis. X% solution, increased first revenue all the revenue

grew revenue quarter year. to XX% by first in Turning continued enterprise the momentum and versus our of vertical, business last

For our the vertical. first history, time represented in it our largest customer

consecutive fourth of year-over-year, Our grew growth. XX% cloud our business quarter double-digit

grew versus was last of recurring year. orders was the security revenue was versus the or provider, six X% XX% enterprise. year. first reviewing last XX quarter our million, $XXX approximately customers for which software services related timing double-digits increased revenue and provider service $XXX year-over-year quarter quarter, increase declined top year-over-year. an million, shipments, Annual of Total service one first due ARR and While the XX% the year-over-year. to was revenue X% Total revenue three were were of an of cloud, In down

in compared XX% product more year. was service XX for the guidance, XX% gross customers top an our margin. to Non-GAAP revenue midpoint customer which was unfavorable accounted the offset the of accounted mix, quarter, we first our by and than XX% cloud customer quarter that total due primarily increase one total of partially below as the revenue. margin In last to had Our in XX.X%, of for

year-over-year in was million COVID-XX essentially We with in related for from a costs, we non-GAAP a was As expenses quarter. reflecting expected, quarterly posted continue Cash supply X% And gross the sequentially. have operations dividends, $X.XX line operating for elevated. $XXX that XX%. if $XX and not Non our margin of margin increased expectations. per estimate these flow million basis dividend was costs on approximately XX.X% GAAP to the would be share. paid which non-GAAP flat Operating quarter, we was of for

We quarter at testament cash, quarter. equivalents, investments also the quarter. in resiliency the the through dedication million in shares $X.X a Total these of performance to financial and cash team’s XXXX repurchased I’m $XXX first our is billion. the dynamic The and of of and challenging worth performance end first was with pleased times. very the

available could Relations on commentary to you Investor Now which our color guidance, in I’d like some website. CFO on detailed provide find the our

We million, growth million, minus which expect second X% $XX or is year-over-year. of at $X,XXX quarter revenue plus

experience logistics year. continue continue component, chain-related supply significant costs, throughout and with which We elevated to to freight headwinds expected the are associated

margin to of decrease gross second is plus see basis. midpoint. expect expect sequentially minus a Therefore, also margin in We at which sequential on a service or approximately the we up X%, quarter XX%, non-GAAP

non-GAAP per $X.XX, share Our shares. plus expected to $X.XX, approximately approximately is count minus million or assuming share be a earnings XXX of

to Turning Ukraine. expectation the the year echo full and with sentiment like respect Rami’s war XXXX, to for between Russia I our to

not to out I’d we point this ongoing In conflict have addition, impact a on like do to business. our that material expect

and deteriorate. similar constrained throughout strong year. backlog, to further X% revenue expect This does supply the order we and full current continue growth levels, current environment to X% the chain Given assumes to for momentum the year, the remains not

the revenue sequentially to year. through expect remainder grow the of We

particularly chain throughout the tight and year. supply quarter challenged during constraints remain be expect to We second the

backlog the the at anticipate year. course of levels throughout to also elevated We remain

the to due macroeconomic difficult can uncertain non-GAAP on to predict Moving gross which margin, be to environment.

improvement through to year. We see the expect sequential

on margin to year versus XXX gross a we now previously. be XX% we XXXX. at We freight range. opportunities That XX% said midpoint full take and of management invest consistent our non-GAAP operating non-GAAP remain up costs to chain year the be basis points operating supply our discipline expect view to expected below provided continue and year least non-GAAP on costs, of expense to expense given to is margin target of with advantage and guidance we the of expansion other will will market pressures basis, full committed current However, to full

XX% tax GAAP on to earnings non is expected be minus Our X%. or rate worldwide plus

on In and faster to dedication continued basis. Our expected non success, to year thank I a especially EPS for commitment revenue our to would challenging is team their in full GAAP than grow Juniper’s environment. like this closing,

the Now, I’d open to like questions. call for

Operator

[Operator Instructions] Simon Leopold coming James. from Your first Raymond question is from

line is Your live.

Simon Leopold

Thanks for bit if little taking cloud maybe customers. with just could the wanted see about on a you question. what’s going I unpack to your

terms So notable contributions behaviors patterns see them you see customer the could the that Thank I going you cloud dig to vertical? of what of you into and cloud a but with are group on do your in talked you. in growing in breaking how and buying if XX% that or about they wanted to majors what’s their

Rami Rahim

What ability vertical our and thanks the within to compete in in strength seeing just question. I’m that ordering cloud momentum for is Yeah, new opportunity. and the and win

strength I think based. that is broad

you is of and existing routing, in both have we routing hyperscale, capitalizing our footprint beyond in space. major as both in know, Most switching. one as tier as in We’re that well cloud it’s but that that, footprint, on our

the based a continues to class prepared notable XX my the I new so. that’s but datacenter it think this standpoint invest based won we’ve equipment from key also have then I in translated quite our our of revenue routing project I We footprint won routing had top continues But the of already in This in ability a the wins which that engagement eventually and provided one think We our business provide customer provider we’ve for important engagement, meaningful, something well in thing and a to on new on that we that this that in standpoint. was notable is an that become manner, So opportunity very in fact customer opportunity remarks. this our there’s think while really do then an strength one that will to and we a strength an the and updates net thus we switching. for several other on one cloud supplier of essentially for as And cloud essentially very I net bodes is to order far, provider. were that’s sales footprint space had mentioned footprint, well. timely

tailwinds coupled of combination engineering a of execution our with sales it’s industry So team. real and good excellent solid

Simon Leopold

you. Thank

Operator

Thank you.

next Your from Vod from coming David is UBS. question

Your line live. is

David Vod

taking for question, guys. Thanks my Great.

a still Automated SP CAGR recovery quickly it of And stop saw this QX quarter, by it? what same heard also an similar and to quarter data timing of cloud-ready data? supply growth, there. for on the sort in think we looks lines, like the Thanks. we rate I’ll this snapback volatility the the provider and in is forward, impact service Should given think center normalized the growth X% dynamics ready How in had supply it along looks just a should due cloud about X% like like to cloud this in then the So next datacenter chain a And and then, chain going shipments quarter, of was we just about expect sort similar WAN. quarter. right way to impacted

Rami Rahim

can start, on Ken, as then this one. me maybe, in let and jump well Okay, you

I our performance, the to feel So think in we strong to timing QX were in due again, primarily, exceptionally in timing where I’ll I that because orders timeframe. of able the revenue provide there All start product this after is performed actually provider customers we of of service service timeframe, all, provider. shipments shipments, saw and an the we revenue From decline entirely slight MX standpoint, when of prepared with to are the introduced basically of into any in solutions, technology the adoption customers, just in my introduced technologies market the remarks, and fastest the recently mentioned very net on line where that provider into MX new that we good we the recently products we’ve it’s five a service new years. our latest of new our based generation market. pickup about last seeing silicon strength the with the our I card well,

speaks the that the as the strength to that of health I again think technology of we’re well the offering. to market, as

terms if than that think still at going this X%, I better we’re the for plus not long-term So, of in that X% vertical particular forward. minus outlook to

think days. XX. to is the from in provider adoption Apstra order we’re just industry combination for brings was end top win a key of new That’s of win able the our datacenter. the solutions. differentiation I that an I end us. net XX% of of these example offerings. very better. and in And new merchant perspective, There, technologies silicon other there did revenue year-over-year kind part of the the solid around product piece question to That’s our achieve to intent-based cloud even cloud automation that an the I talked standpoint, networking Rapid execution. think we a ready data of growth, from good about tailwinds, well, a center again, it’s industry leading

So lot long we view the X% there’s right And center a vertical our there, have term is for again, us now. data to in X%. cloud-ready going

we’ll anything add? else not think you’d if at than Ken view. I long like term to better that do

Ken Miller

given at we given CRBC, service long-term just than solutions, the out do reiterate, for I would there. or of FYXX our including revenue I and verticals, specific guidance In any including all but could put customer all all believe better provider, I that customer be Rami, mentioned model really we to haven’t solutions all verticals, of supply this run our we solutions. But last good and for quarter, a based will little customer of which see you that couple verticals, shipment saw all you QX you’re very or to be long bit all going about a and is feel chain quarter and based continue. weeks, last the anomalies, going think of

David Vod

Ken. right. Thanks, Rami. All Thanks,

Ken Miller

Yep.

Operator

Thank you.

next Goldman is question from from coming Sachs. Rod Hall Your

is Your line live.

Rod Hall

thanks on the Yeah. just on that know weakness. affected how a and if margins? cost. the could the customer guys, into I But that talk product also a color side you talked give much question. us check mix, bit how about little the dig mix it wanted is sequential wonder for Hey, and give us I back about you little of more can the of gross guys I mix margin and any temporary, you Thanks. bit to the

Rami Rahim

less about of some so for you And for if of knew basis obviously, Absolutely. if while. looking been going COVID-related compare even quarter little these specifically, bit will we points, what mean, hardware bit and our with But MX a much procure XX% at little QX on talking approximately shipped this the posted would to in the it from the our But That be We about the anticipated ship we’ve of margin mix a shipment gross MX higher, which our over a at more product. the we trend shipped points we and kind missed carries a access driver in which not I little XX% go the of transitory. we But don’t that obviously, costs is basis, be do if long we primary a a XXX than believe software, do over to or we in that that from and QX, obviously, impact more to particular, in a low miss costs it was time are issue. positive of we set bit recognize the mix guidance, rest than cost, to a relatively our a we backlog. from supply we a with shipping run. XX.X% basis access happens of a time, shipped expected it MX, not to gross perspective, you’re at and far to the that was these And at but less and systems guidance. ability constrained building in kind XX.X%. lot you And came has in little points, we as to MX actually a components down it margin, demand have and been guide product margin the very biggest it back, compared portfolio we’re related software if the strong here, issue XX nearly QX, really most is and the points we more ship sell recent margin we have of by was

Rod Hall

been follow just all that topic. maybe Do sight bit looks it you, an guys additional make issue have then know here. what supplier? gets little these disruptions just same of that’s kind impossible that question wondering with the Is any so when just on an supply that it you a better? like for up line I to know to And supply there of ongoing that visibility

Rami Rahim

of shortages, some it’s material had difficult kind series some continuous whether of, even going the COVID of would even disruptions, it’s shoot to our say partners. logistics more is or quarters of what several given now, I a shutdowns predict XX system to in and beyond difficult seeing we’ve I war Yeah, we’re even from bottlenecks, with that. to and suppliers in it’s predict less days any Ukraine, related we’re of outages mean, or

more be and year to to the necessary, I year see get still for prudent in I through and to in throughout now. I than of couple to obviously, don’t do think this X% anticipate At I I quarters. half significant navigate the the I disruptions am we’ll potentially supply best beginning the our feel I it’s admit, entire of this the XXXX. bullish time, X% these more presume to to think that we’ll improvements now improvements little ‘XX on have a revenue at second point goals improvements unpredictable up continue was will disruptions of We have in ability. of the get year, year-on-year. the next seeing our to we’ll

example, last ship absolute, will ability than what very and year our our more. revenue year faster We grow be to be this as supply more even will are signals as compared an it’ll to so demand plentiful and still constrained but

Rod Hall

I a amount. I guys you that X.X, of are bit that of can was that the little maybe billion Are stick you higher the -- I’m the you with guess know you there kind X.X or you think than it said that on you given now? right. exit expecting that? to guys backlog? exit change, you upward pressure that you year are kind Do remembering -- is if Do still to backlog was thinking a

Rami Rahim

year. last it X.X XXX did any would to will be hard grow predict, that order land. quarter. expectation somewhere to where it certainty this, I is the of magnitude million we we be was it in greater X.X. elevated, or whether Rod, my X.X it with this than as It’s Yeah, tell We are exit going you significantly will But

better and does supply result year, if opportunity obviously elevated beyond, year this in the later that even XXXX in more significantly will backlog. as not So exited get with we

Operator

you. Thank

from is Wells from Your next Fargo. Aaron Rakers question coming

is live. line Your

Aaron Rakers

Yeah, thanks.

you And backlog coming last I you’re up plus think of X.X carrying on following that just filings out billion how in that your Just you can, question first, carrying if relative last XX-K that of maybe out quick noted as I quarter? as months. up, to that definitely follow extends what would you curious have I the a you’re characterize duration That XX now, well. the saw that

Rami Rahim

the would duration day quarter. is similar last to I what Yeah, saw we

supply. customers Just able we’re the than to mean, product sooner looking clarify, for I to are largely

XX of times the we’re So a able that constraints product of actually seeing unfortunately horizon with, are deliver. supply because sooner customers we’re getting kind the month interested than in -- is that to we’re lead and dealing

Aaron Rakers

follow deal. Yeah. the question sounds center big footprint, And quick it going then Simon’s a back as up, a to data like on

changed to you’ve for the opinion a Has some reluctant inside as vendors. of switching cloud in Juniper about big your color center it competitive of major any kind win? been Just cloud characterize Ken, think, on further that opportunity was think competitive large what a -- on the I would or wins past, displacement? additional you seemingly And the that? was data how

Rami Rahim

Yeah, Aaron, good question. that’s a

have few reluctant hyperscale we because been hyperscale use call So that center that there win number centers. are of data customers for -- their data a are very to OEMs

fair beyond to at any. that, we’ve at continuing to more we That that which to our this hyperscale So completely compete the in for opportunity just along we all for, than for, very and take doing that. absolutely in compete share, say said, announcing And strategic said are is point is go a saw that. to at we’re us let’s not but just time, few large we’re that opportunity just are there with many

side, XX, achieve a of difficult on it a we do the of meaningful supplies, to ability was strength to orders in us requested customer. when side we net the this terms switching when competed technology, in for and required switching example necessary into top that were routing of tasks perfect with and the pretty have new getting is engagement So the by able non-hyperscale, the translate the where in revenue, customer the we very fact the of our already that

sizeable and So, just about and to to that all lucrative net want these to mentioned. our above based really for, feel in we see we’re opportunities be And cloud switching good in large to that new of of a a in both opportunity beyond and more clear what I hyperscale, hyperscale competing I in types deals of us, continue win I’ve before routing, led win. very the all of on majors

Aaron Rakers

you. Congratulates. Thank Great.

Rami Rahim

you. Thank

Operator

Thank you.

Your next Notter from George from coming question is Jefferies.

live. Your line is

George Notter

Hi, thanks I wanted about pricing. to lot. a ask I guess

have additional you have you some flows on actions. back for an think the give us extra a where you forward? much and update is there that when there? potential could and increases talk price going But maybe taken the embedded looking How pricing guys stand price into of list you into couple pricing I model about

Rami Rahim

we our year. will some last second this do benefit pretty actions, have the for couple that strength year’s time some of into taken year. we take backlog, Yeah, but significant model, last half actions expect to see actions a of in flow the of given It the

So of start to a here quarters. in some we’ll few that realize

future think we announce pricing look looking us And that this best makes to on we sense make some are we’re some a think but cost hit of to lag are where As we few continuing quantified haven’t that opportunities due that and count on far gross but as the really quarters here is to all the take that we of could to actions previous at we’re advantage us making forward. going dollars cost decisions options to actions you call, the always the were our actions, increases take we to we increases at for pricing going timing are nothing sense for There here Juniper a seeing. that these and losing seeing profit of much intent is the to sooner, -- offset materialize. moving

George Notter

hiring sales just then guys you see to also Thanks. investments to noticed aggressively here little looking I the And to expect and those of you at but going a you out headcount the numbers. acquisition the be seem things it. of marketing also, and investments? there your one yield can about pretty know Got when where I was are talk in start

Rami Rahim

up hire learning sales, perspective a in it majority outpace see absolutely in of be it’s market we go and to it improvement feel and to it ramp are From the we question. continue a and obviously, advantage opportunity opportunity a take the several no, of operating about the confident have advantage space, to is majority curve to investing These we margin. Yeah, in this great to a revenue in this to enterprise market, and want an this we the and and last our to compared make the a general, points differentiation our prominent have, mean, we’ve to year, like we talked we and and -- when the where margin, good in years which is come. to outpace and where basis give revenue have a operating quarter could we productivity expect I target sure headcount that of invest could the year. there and expand we -- XXX sure of take the marketplace. headcount expect year that of does quarter that we and who is outpace OpEx OpEx folks, basis do OpEx, to very in year is very why do believe well, for make momentum we as we of current absolutely to next we to to we’re we feel full up thinking on next we portfolio We remain thinking expect we really years modeled continuing beyond been take that is us you we in lot continue enterprise everything spending

George Notter

it. Got Thank you.

Rami Rahim

Yep.

Operator

you. Thank

question Amit Your next Evercore. from is coming Daryanani from

live. is Your line

Amit Daryanani

debater taking a is full that question. Is a just for on durability lot my you’re of a of seeing. the staff demand Thanks always bit

is your look top talk but mean, X it said, at I trajectory imply I built guess just this even I if this look after about confidence perhaps of Rami, which So, line I ‘XX normally see your you if growth has this, years the in comfort north up, you backlog, how backlog and that. the which digit high around and if should of single for you you billion, think quality of backlog at the

you year? to me this just a versus see the terms walk So, enable basis and takes of on does through one in high-single around multi-year puts digit a growth

Rami Rahim

XXXX. we full year been X% did because to know, we X% basis, full but so come. growth a year in not year we’re on be opportunity into you to will few specifics for year, with provide the there’s the chain the backlog think growth year model the confidence we think quite normalize a us to We’ve in honestly, on continue starts I expecting lot we’re I to reason so last no this to backlog, to give turn revenue Yeah, outperforming just up years have will built with and XXXX, I especially XXXX. a revenue, believe and if won’t to outperform X.X% do does just XXXX, say really to are that expecting on of we prepared and this, exit significantly not us basis a elevated supply

Amit Daryanani

curious, you I outperformance, able it’s of just guessing. you than now? you grain can are and accelerating gains enabling you. right that about think is to doing somewhat are over it’s that your are follow that out? end some don’t do I because Juniper of perspective, components what From kind somewhat I’m share is when a get peers you the share If So think this I’m better it now it think helping think some right What just you degree you growth markets almost you or suppliers attribute for the this, just like for on do do that’s up of here

Rami Rahim

Yes, do the that’s it’s done we factor. situation, supply of question. have difficult don’t primary a a think think managing I is good I job good but what a really

new introductions net solution cycle and out in switching dynamics solid acquisition, new that No strength silicon the grew the the starting but the think driven product solution can that the use in focused years, MX several and XX% best of helping by And tremendously on differentiation, I on primary the in with addresses terms I opportunities then I new differentiation differentiated. in key automation, just an our driven is product combination say solution our of for wAN, growth. think we for MX where last really the healthy winning take, AI-driven and these really solution brand an to exceptional AI perform an just continuing data a center a technology, the enterprise That’s demand what the and Automated customers execution. I switching market, Underlay essentially the the business year-over-year also been really for same and as market with are enterprise cases associated and expanded leading, based Wi-Fi, working. mean, have it’s It SD-WAN, is technology. so architecture longer example, in to of very number order is it and product we’re now, market. include we things. with of our focused maniacally it’s the is for have One in revenue, about PTX market. pain that’s Apstra Mist EX us new is delivered thing in solid. the the also even on differentiation, now cloud point a factor is The strong our

Operator

you. Thank

question Suva Citigroup. coming is from Your next Jim from

is line live. Your

Jim Suva

think full kind those you’d new XXXX the you you. and significant prepared your are Were wins Thank material. after Rami, of comments, mentioned or I clarity then? guidance, year a you that’d any word around since new I I’m the when us, you wins talking mentioned your you In new they help Thank to gave some get be that, could be like guess, say just So And XX are view optimism just you. significant, that customer? excitement top to and great. trying calibrate they

Rami Rahim

so the I’ll take Yeah, question.

than based X% will today We’re soon on little and days more be probably to I going size has honestly, Jim, would picture of was of it changed. our it our in and orders half absolutely anything supply customer XX not is to perspective. very has else If is excited lessons optimism forward That ago. revenue say, supply might about the said, win a meaningful opportunity, second X% our to been anything, the strength, a guide it from the than and meaningful better my results that our revenue get

the for kind really it’s can supply, and gets is not we if demand, the meaningful incremental But the ship. on for is. us would much what who yes, XX us, revenue, customer of say, potential a has we upside customers have at supply this matter so because customer a of very incremental a fixed our So certain to I it be in depending products top when customer quarters,

Ken Miller

not this more that that year-over-year. point us also time. in means XX% talked I’m add, in I about, Cloud-ready I’m for grew And but And growing win this fast is just addition excited one to our to excited. what we’ve this forward. even market at ones going by Jim, center specific the just ability this prior think to to win data that win, in don’t the

that’s We’re new on now together teams competing in now market. with have that our the working we with been that’s years market, technology the technology for in

a these we’re able that in of what our against competitive a space win new we gives pure confidence terms technologies. in understanding ability to solutions more the of we forward. are much so going in have a of landscape, fact And to lot the And us better competitive up do even

Jim Suva

so you Thank much.

Ken Miller

bet. You

Operator

you. Thank

is Your Morgan coming Meta from Stanley. next Marshall from question

live. is line Your

Meta Marshall

general quarter, may up the upon be some just And couple different the there. chain service maybe kind builds A One, you’re constraints the could last some the of as any specialized of far seeing had componentry any that provider me. on availability just give networking on supply trends you had more thanks. of there’s guys of if and you Great, free additional question second context questions versus then what for on of as tips side.

the what of waiting the from side maybe coming constraints just Thanks. the of categories so kind just from it that has or service just of new on is for? And changed products provider wondering, some of you’re semiconductors kind

Rami Rahim

situation, mole general kind does is unfortunately, Yeah, the mean, so pretty on it the of on back bit transistors, of of our constrained really game. Right of depending depending go it, the say much higher forth the of equally it’s answer lower I when it comes chips really now, a versus say board, quarter. to and a you and will. some a ASICs, end end we’re if I across I some would I a bit -- those would whack kind relatively components, between

timing components. fluctuate short change. we matter perhaps but QX QX. did, the and liked in argue just of and we I of would ship what to little spectrum -- would persistent. can It’s like still procure going we quarter. I We as market think it’s QX across we short of when as a as of been to in we in were that’s kind parts more we’ve than ship broad quarter shipments more can really a it’s the QX, everybody expectations, mean, able really try many scouring but were are a but portfolio to rounding we to QX our to in we a just yes, We end could ship supply bit build -- right. QX higher And just more don’t have I and a shortages a -- to there’s been to material were of compared are kind say, a that’s thing.

Meta Marshall

Thanks. it. Got

Rami Rahim

Yeah.

Operator

you. Thank

from Your coming next is Paul Silverstein Cowen. question from

live. is line Your

Paul Silverstein

that or XXXX. XXXX, straightforward to depth risk get and but that got of seems itself zero, momentum enterprise different beyond that’s the similar as for you differentiator question. risk you significant than you about today a when perspective in product it for my when Juniper from My line recall, a I the I’ve would to far recognize that successful. The then is the above Guys, I if to from question took Mist or in Synopsys. if be and is, you to you questions that when replay revenue, breadth And XXXX, market notwithstanding I an happened that that extremely which I it’s product you of when, entered was I the back What’s the time. factors to you just enterprise where entered way have about that it you enterprise, question the of go larger your flat suggest it so is but [indiscernible] what recognize could business and back Aurrion, of significant span seems, at to, enterprise, was campus Again, $XXX proceeded the recall, in from never quick if had phenomenally is was XXXX. that’s scenario? quick off back other if Then back and launch it question far portfolio the Two in may. exciting address today, when very million portfolio I hit a appears? ground when channel it numbers But a product switching you what’s because realize

Ken Miller

I’m crack at to a Paul, going take Okay, that.

maybe I channels, the in to you takes solution, business and One, to key that talent it three things, four, go the think up from it, with leading experience that name it. unbelievable firsthand really enterprise breadth the talent has the what depth have have we win big actually. a can difference all do today is market, that right

it we win on out ones had we solve go that to to the to direct we well but painful channel based differentiation course, takes the Second, some includes continue win this to perform to market technology solution then set the the is it understood way, motion just channel in again, and motion, And to talent, past lessons but we the out what keep to And in the win, solve strength did in new learned to win create the leadership by market. the of on to set motion this, to new what that requirements takes know it’s necessary finally, itself. selling the to selling that not the a sustainably. we just to understand and technology not fabulous mind, and get of

now the in driven have particular, by think not qualified third center I would the the right that of also customers, internal level I this with of enterprise in in AI history not include analysts independent second of our to magnitude but none. differentiation by ever I we seen just analysis, Juniper. enjoy by Apstra differentiation, but party data is

vertical the that confidence utmost and growth is have is a company. sustainable, for This short-term thing. not long-term competitive I advantage So a this

Paul Silverstein

get be China to acquired any Appreciate of amount respond ‘XX OpEx, that the a you assets, -- to the decent I or I interest be now on put that. and been you’ve assume back, in ‘XX. whatever any benefit there it that response. sales marketing that are Aurrion to is you if minority going But there’s could into OpEx it will from statement, that putting rid you a shown JV, And on in And and can and lockdown? into a those Synopsys concerns since of then you’ll the I income think R&D as was assume

Ken Miller

I what? on what Concerns didn’t catch part. channel, the last

Paul Silverstein

China China. lockdowns.

Ken Miller

China, Oh, sorry.

Silicon now a be look contemplated it’s internally, opportunities on absolute was zero OpEx, year, was if said advantage that we transaction just for OpEx transaction OpEx guidance. earlier and market, it’s enterprise so this at while. Photonics plans Rami about long-term working motion in been RNPCS go months to less to factored talked you we invest it than Silicon in our the as particular. our year-on-year see the We’ve going [Phonetic], here since the say so on spend, being it -- last just was factored our on into continue mentioned about spent to total year. year-on-year, on and up wouldn’t predominantly going for take That this into to the to of several So our closed, for We Photonics to go

very obviously On to is Paul, we’re targets, more something the is the watching factored term shutdowns, into shutdowns, real not COVID-related due short So it the long seen closely. recent we answer. China, impact have any

in have the on reduced knows side, footprint happen have so very footprint but what’s were China, to far there, most We manufacturing watching something we some shutdowns, but for is our we’re but Who tomorrow, we still it unimpacted. dependence -- recent component closely. particularly the going

Paul Silverstein

you. Thank

Rami Rahim

Paul. Thanks,

Operator

you. Thank

next from Fish is from coming Piper Your question Sandler. Jim

Your line is live.

Unidentified Analyst

Thank our for taking question. you [indiscernible] Thanks This for Fish. guys. is Jim

return sustainable demand in that quarter about a but business, that the seeing bump it security ‘XX? we you you is? noted and deflated it opportunity growth despite term here. persist And provide you kind any Is seen terms Thank color help some two through then longer you. security confident makes thinking this recent of strength? can to for is strong we’ve growth what kind Can ‘XX that some Just the market of you’re can us something or can you how of sort of one or understand

Rami Rahim

it’s Yeah, actually asked. I’m glad a good question. you

particular, accounts depends purchasing sort on tend bulk way strong particular and of And think gross orders that’s of the then every to be that relatively fewer element data and that’s has that deployment accounts security number our business the first, that the cyclical. Also, business, those of somewhat look contributing just attached, for the attach just sells it’s absolutely SP a software a our our I already there ready that it’s really to is that of margins, our end, growth cloud business, AI to and in good to strategic helping of profitable it’s solutions, tends enterprise, patterns driven center solutions. an security businesses. success It and So to a is these to and in at we it’s business, security that cloud makes security and an large business, our and important understand primarily buy lumpy. high now

I So attach for business. I based us security, that think, strength on see competitive we the fact -- solutions bodes to why this confident of well continue and remain that the in our in about future the

Unidentified Analyst

you. Thank sense. Makes

Operator

will concludes remarks. Q&A Thank closing CEO now you. back for session. our the That hand to I conference Rami Rahim ahead. Please go

Rami Rahim

Thanks just performing by we’re I I business. be our say to are end very that that believe momentum to continue very strong the They’re healthy. markets in seeing our well. want much. encouraged I

seeing in segments. I seeing recovering the as fact of across relative love very market the by they’re think well provided. we’ve across our do that well to the long-term diversity that vertical up to that well sets solution we’re strength as I even in already the that strength we’re us were areas I believe demand the areas, pandemic. execution affected outlook And

So to I for want time today. everyone thank the and the opportunity

Operator

gentlemen. today’s event. you, ladies and This Thank concludes

have this wonderful at you You a for time may Thank day. and participation. disconnect

Juniper Networks (JNPR) 27 Apr 222022 Q1 Earnings call transcript