- Revenue: $1,102 million, up 21% year-over-year and down 7% sequentially
- Operating Margin: 16.1% GAAP; 22.3% non-GAAP
- GAAP Net Income Per Share: $0.24 diluted
- Non-GAAP Net Income Per Share: $0.32 diluted, up 19% year-over-year and down 24% sequentially
Net revenues for the first quarter of 2011 increased 21% on a year-over-year basis to $1,102 million. The Company posted GAAP net income of $130 million, or $0.24 per diluted share, and non-GAAP net income of $178 million, or $0.32 per diluted share for the first quarter of 2011. GAAP net income includes half a cent dilutive impact from net interest expense related to the $1 billion dollars of senior notes we issued during the quarter. Non-GAAP net income per diluted share increased 19% compared to the first quarter of 2010 and decreased 24% compared to last quarter. The reconciliation between GAAP and non-GAAP results of operations is provided in a table immediately following the Net Revenues by Market table below.
"Juniper delivered solid results in the first quarter and continued to build on market momentum," said Kevin Johnson, chief executive officer at Juniper Networks. "We are executing on our innovation roadmap with new solutions that define our vision of the new network. Innovation is at the core of our multi-year growth agenda."
Juniper's operating margin for the first quarter of 2011 decreased to 16.1% on a GAAP basis from 19.1% in the fourth quarter of 2010, and decreased from 17.6% in the prior year first quarter. As anticipated, non-GAAP operating margin for the first quarter of 2011 decreased to 22.3% on a non-GAAP basis from 24.5% in the fourth quarter of 2010, and decreased from 23.2% in the prior year first quarter.
For the first quarter of 2011, Juniper generated cash from operations of approximately $240 million. Net cash from operations for the same quarter in 2010 was $258 million before litigation settlement payments of $169 million, which were incurred as charges against the Company's fourth quarter of 2009 results. As a result of the litigation settlement payments, net cash from operations for the first quarter of 2010 was $89 million.
Capital expenditures as well as depreciation and amortization expense during the first quarter of 2011 were $54 million and $41 million, respectively.
"The first quarter was a very solid start to the year, with Juniper generating strong revenue and earnings growth," said Robyn Denholm, chief financial officer at Juniper Networks. "Our innovation engine was in high gear as we positioned sales and marketing resources to capture the opportunity ahead and continue to perform at levels consistent with our long-term financial targets."
The overall demand environment for both the Service Provider and Enterprise markets looks healthy across all regions. Our outlook for the June quarter includes any anticipated impact to our business from the recent events in Japan.
- Juniper estimates revenue for the second quarter ending June 30, 2011, to be in the range of $1.130 billion to $1.180 billion, which represents a year over year increase of approximately 16% to 21%.
- Juniper estimates that its non-GAAP gross margin will remain in its targeted range of between 66% and 68% in the second quarter.
- Juniper estimates that its non-GAAP operating expenses will be lower as a percent of revenue, but will increase sequentially on a dollar basis. As a result, Juniper expects its non-GAAP operating margin for the second quarter will be 22.5%, plus or minus 0.5%.
- Juniper estimates that its non-GAAP net income per share will range between $0.31 and $0.34 on a diluted basis, assuming a slight increase in share count and estimated non-GAAP tax rate of 26.5%. The non-GAAP EPS estimate includes a dilutive impact of approximately one and a half cents, $0.015, per share due to net interest expense from our debt.
All forward-looking non-GAAP measures exclude estimates for amortization of intangible assets, share-based compensation expenses, acquisition related charges, restructuring charges, litigation settlement charges, gain or loss on equity investments, non-recurring income tax adjustments, valuation allowance on deferred tax assets, and income tax effect of non-GAAP exclusions. A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis.
Conference Call Web Cast
Juniper Networks will host a conference call web cast today, April 19, 2011 at 2:00 p.m. (Pacific Time), to be broadcast live over the Internet at: http://www.juniper.net/company/investor/conferencecall.html.
To participate via telephone, in the U.S. the toll free dial-in number is 877-407-8033; outside of the U.S. dial +1-201-689-8033. Please call ten minutes prior to the scheduled conference call time. The webcast replay of the conference call will be archived on the Juniper Networks website until June 14, 2011.
About Juniper Networks
Juniper Networks is in the business of network innovation. From devices to data centers, from consumers to cloud providers, Juniper Networks delivers the software, silicon and systems that transform the experience and economics of networking. Additional information can be found at Juniper Networks (www.juniper.net).
Juniper Networks and Junos are registered trademarks of Juniper Networks, Inc. in the United States and other countries. The Juniper Networks and Junos logos are trademarks of Juniper Networks, Inc. All other trademarks, service marks, registered trademarks, or registered service marks are the property of their respective owners.
Statements in this release concerning Juniper Networks' business outlook, economic and market outlook, future financial and operating results, and overall future prospects are forward-looking statements that involve a number of uncertainties and risks. Actual results or events could differ materially from those anticipated in those forward-looking statements as a result of certain factors, including: general economic conditions globally or regionally; business and economic conditions in the networking industry; changes in overall technology spending; the network capacity requirements of communication service providers; contractual terms that may result in the deferral of revenue; increases in and the effect of competition; the timing of orders and their fulfillment; manufacturing and supply chain constraints; ability to establish and maintain relationships with distributors, resellers and other partners; variations in the expected mix of products sold; changes in customer mix; changes in geography mix; customer and industry analyst perceptions of Juniper Networks and its technology, products and future prospects; delays in scheduled product availability; market acceptance of Juniper Networks products and services; rapid technological and market change; adoption of regulations or standards affecting Juniper Networks products, services or the networking industry; the ability to successfully acquire, integrate and manage businesses and technologies; product defects, returns or vulnerabilities; the ability to recruit and retain key personnel; significant effects of tax legislation and judicial or administrative interpretation of tax regulations; currency fluctuations; litigation; and other factors listed in Juniper Networks' most recent report on Form 10-K filed with the Securities and Exchange Commission. All statements made in this press release are made only as of the date set forth at the beginning of this release. Juniper Networks undertakes no obligation to update the information in this release in the event facts or circumstances subsequently change after the date of this press release.
Juniper Networks believes that the presentation of non-GAAP financial information provides important supplemental information to management and investors regarding financial and business trends relating to the company's financial condition and results of operations. For further information regarding why Juniper Networks believes that these non-GAAP measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the discussion below.