Juniper multi-cloud strategy aimed at enterprise data centers
Juniper Networks, a longtime provider of network hardware for carriers and the largest enterprises, is now looking for more mainstream corporations to help pull it out of a revenue slump that recently hammered its stock price.
Last week, the company’s revenue and profit projections for the current quarter fell short of analyst projections, which led to an investor exodus that resulted in as much as an 11.5% drop in the company’s stock price on Friday. The forecast followed a second-quarter earnings report that had revenue down 8% year over year to $1.2 billion. Net income fell 35% to $116.5 million.
Despite the drops, Juniper’s second-quarter results beat analyst projections, and the company said it remained confident it would return to year-over-year quarterly growth in the fourth quarter. This time, however, the company expects enterprises smaller than Juniper’s typical Fortune 500 customer to play a significant role in the positive results.
@Juniper #multicloud strategy aimed at broadening customer base
The product expected to lure those companies is @Contrail Enterprise Multicloud, a #software product the company unveiled in April and planned to release this quarter. Juniper designed Contrail Enterprise Multicloud for managing a virtualized #network fabric that supports applications running on an enterprise data center and infrastructure-as-a-service providers. The product competes with @VMware ‘s #NSX and @Cisco ‘s Application Centric Infrastructure technology.
“We’ve talked — we’ve recently talked a lot about the Contrail Enterprise Multicloud product that we announced earlier this year; that should be shipping soon, and we think that’s going to drive a lot of momentum in the whole enterprise data center solution, which is really a software-led solution,” Juniper CFO Ken Miller told analysts, according to a transcript of the earnings call published by financial site Seeking Alpha.
Juniper’s optimism is due to the progress it has made in selling software for networking and analytics to its traditional customer base. Total software revenue rose 28% year over year in the second quarter. It was driven, in part, by sales of Contrail, the company’s software-defined networking system for the data center, and AppFormix, which does network analytics and policy monitoring.
Chances for success of the Juniper multi-cloud strategy
Initially, Contrail Enterprise Multicloud should help Juniper hold on to its existing market share in networking, said Shamus McGillicuddy, an analyst at Enterprise Management Associates, based in Boulder, Colo.
“I don’t expect Juniper to suddenly start taking significant market share from VMware or Cisco, but it should be more competitive,” he said. “And Juniper is now better positioned to hold on to its existing market share.”
Contrail Enterprise Multicloud is one of several new products Juniper has designed for corporate networking. In June, the company introduced a line of campus switches that use the same network protocols as Juniper hardware found in the data center. As a result, the same engineering team can manage the data center and the campus.
Juniper also released improvements to its software-defined WAN for the campus. Juniper’s SD-WAN is a feature within its NFX Network Services Platform. The platform includes network orchestration software, a virtual firewall, an IP VPN, content filtering and threat management.
How far Juniper can push outside its traditional customer base will depend on the number of midsize enterprises that have migrated applications to multiple-cloud environments, said Brad Casemore, an analyst at IDC.
“There’s some opportunity there [with midsize enterprises], no doubt, but it all depends how complex, dynamic and distributed their application environments are or will be,” Casemore said. “If they just have a few relatively static applications on premises and a couple of apps in a single public cloud, there’s not as much of an urgent requirement for something like Contrail Enterprise Multicloud.”