Election Section

Juniper Networks warns on earnings, will cut jobs

The Associated Press
Saturday June 09, 2001

SAN JOSE — Network equipment maker Juniper Networks Inc. said Friday it will cut its work force by as much as 9 percent, or about 100 jobs, as second-quarter earnings and revenue will fall well below Wall Street expectations. 

Sunnyvale, Calif.-based Juniper now expects revenue to range from $200 million to $210 million for the three months ending June 30.  

That’s down from original forecasts of $300 million to $330 million provided in its April earnings report. 

Earnings for the period will be 8 cents to 9 cents a share, sharply down from the 24 cents a share anticipated by analysts surveyed by Thomson Financial/First Call. 

The company said cost-cutting measures will include the job cuts and a one-time charge of up to $45 million. Juniper had 1,162 employees as of March 31. 

“Obviously we would prefer to be in markets that grow without hesitation or pause,” said Scott Kriens, chairman and CEO of Juniper Networks.  

“However, we remain committed to and capable of running the business profitably and successfully under all conditions, including this current period of absorption.” 

Shares of Juniper were down 18 percent, or $8.38, to $38.14, in afternoon trading on the Nasdaq Stock Market. 

Network equipment makers such as Juniper and Cisco Systems Inc. were hard hit as the economy slowed down and the Internet bubble burst last year. 

Demand for routers, switches and other tools of the Net trade fell sharply after big network rollouts were canceled, dot coms failed and established companies saw no reason to continue expanding. 

Unlike the microprocessor industry, which has recently showed some signs of life, there’s no indication network equipment manufacturing companies have hit bottom, said Ashwin Navin, an analyst at Epoch Partners. 

“Things seem to be getting worse,” he said, adding he does not see a return to growth until the middle of next year. 

Kriens said the source of the weakness is not a loss of market share or fierce competition. 

“We have not caused anybody else’s slowdown in this market nor has any other company caused ours,” he said. “We are all in a market where less is being spent, and the money that is spent is being parted with much more carefully.” 

On the Net: 

Juniper Networks Inc.: http://www.juniper.net