SUNNYVALE, Calif.--(BUSINESS WIRE)--Juniper Networks (NYSE: JNPR), a leader in secure, AI-Native Networks, today reported preliminary financial results for the three months ended September 30, 2024.

Proposed Merger with Hewlett Packard Enterprise

As announced on January 9, 2024, Hewlett Packard Enterprise Company (“HPE”) plans to acquire Juniper Networks in an all-cash transaction for $40.00 per share, representing an equity value of approximately $14 billion. The transaction is currently expected to close in late calendar year 2024 or early calendar year 2025, subject to receipt of regulatory approvals, and satisfaction of other customary closing conditions.

Third Quarter 2024 Financial Performance

Net revenues were $1,331.0 million, a decrease of 5% year-over-year, and an increase of 12% sequentially.

GAAP operating margin was 7.1%, an increase from 6.3% in the third quarter of 2023, and an increase from 3.8% in the second quarter of 2024.

Non-GAAP operating margin was 15.0%, a decrease from 17.5% in the third quarter of 2023, and an increase from 10.9% in the second quarter of 2024.

GAAP net income was $92.6 million, an increase of 22% year-over-year, and an increase of 172% sequentially, resulting in diluted net income per share of $0.28.

Non-GAAP net income was $159.7 million, a decrease of 18% year-over-year, and an increase of 57% sequentially, resulting in non-GAAP diluted net income per share of $0.48.

The reconciliation between GAAP and non-GAAP financial measures is provided in a table immediately following the Preliminary Net Revenues by Geographic Region table below.

“We experienced strong demand during the September quarter, with total product orders growing nearly 60% year-over-year,” said Juniper’s CEO, Rami Rahim. “We saw particularly robust orders from our cloud customers during Q3 in support of front-end and back-end AI networking initiatives. We also experienced double-digit sequential and year-over-year order growth in our enterprise and service provider verticals.”

“Our Q3 financial results exceeded our expectations,” said Juniper’s CFO, Ken Miller. “We maintain strong momentum entering the December quarter and remain optimistic regarding our long-term financial prospects.”

Balance Sheet and Other Financial Results

Total cash, cash equivalents, and investments as of September 30, 2024 were $1,562.9 million, compared to $1,418.0 million as of September 30, 2023, and $1,430.3 million as of June 30, 2024.

Net cash flows provided by operations for the third quarter of 2024 were $192.2 million, compared to net cash flows provided by operations of $329.2 million in the third quarter of 2023, and net cash flows used in operations of $8.9 million in the second quarter of 2024.

Days sales outstanding in accounts receivable was 65 days in the third quarter of 2024, compared to 60 days in the third quarter of 2023, and 66 days in the second quarter of 2024.

Capital expenditures were $30.1 million, and depreciation and amortization expense was $38.7 million during the third quarter of 2024.

Capital Return

Our Board of Directors has declared a cash dividend of $0.22 per share to be paid on December 23, 2024 to stockholders of record as of the close of business on December 2, 2024. We remain committed to paying our dividend; we have suspended our stock repurchase program in accordance with the terms of the merger agreement with HPE.

Third Quarter 2024 Financial Commentary Available Online

A CFO Commentary reviewing Juniper Networks’ preliminary third quarter 2024 financial results will be published on Juniper Networks’ website at http://investor.juniper.net.

In light of the proposed transaction with HPE, and as is customary during the pendency of an acquisition, Juniper Networks will not be providing financial guidance for 2024.

About Juniper Networks

Juniper Networks believes that connectivity is not the same as experiencing a great connection. Juniper's AI-Native Networking Platform is built from the ground up to leverage AI to deliver exceptional, highly secure and sustainable user experiences from the edge to the data center and cloud. Additional information can be found at Juniper Networks (www.juniper.net) or connect with Juniper on X (formerly Twitter), LinkedIn, and Facebook.

Investors and others should note that Juniper Networks announces material financial and operational information to its investors using its Investor Relations website, press releases, SEC filings and public conference calls and webcasts. Juniper Networks also intends to use the X (formerly Twitter) account @JuniperNetworks and Juniper Networks’ blogs as a means of disclosing information about Juniper Networks and for complying with its disclosure obligations under Regulation FD. The social media channels that Juniper Networks intends to use as a means of disclosing information described above may be updated from time to time as listed on Juniper Networks’ Investor Relations website.

Juniper Networks, the Juniper Networks logo, Juniper, Junos, and other trademarks are registered trademarks of Juniper Networks, Inc. and/or its affiliates in the United States and other countries. Other names may be trademarks of their respective owners.

Safe Harbor; Forward-Looking Statements

Statements in this release concerning Juniper Networks’ business, economic and market outlook, our expectations regarding our liquidity and capital return program; deal, customer and product mix; costs and supply constraints; backlog; customer demand; the completion of the proposed transaction with HPE on anticipated terms and timing or at all, including obtaining regulatory approvals and other conditions to the completion of the transaction; and our overall future prospects are forward-looking statements within the meaning of the Private Securities Litigation Reform Act 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 several factors, including: the completion of the proposed transaction with HPE on anticipated terms and timing or at all, including obtaining regulatory approvals and other conditions to the completion of the transaction; the fact that if the proposed transaction is completed, Juniper stockholders will forego the opportunity to realize the potential long-term value of the successful execution of Juniper’s current strategy as an independent company, which will also be affected by the ability of HPE to integrate and implement its plans, forecasts and other expectations with respect to Juniper’s business after the completion of the proposed transaction and realize additional opportunities for growth and innovation; the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the merger agreement; Juniper’s ability to implement its business strategies; potential significant transaction costs associated with the proposed transaction; the risks related to HPE’s financing of the proposed transaction; potential litigation or regulatory actions relating to the proposed transaction; the risk that disruptions from the proposed transaction will harm Juniper’s business, including current plans and operations, and risks related to diverting management’s attention from Juniper’s ongoing business operations and relationships; the ability of Juniper to retain and hire personnel; potential adverse business uncertainty resulting from the announcement, pendency or completion of the proposed transaction, including restrictions during the pendency of the proposed transaction that may impact Juniper’s ability to pursue certain business opportunities or strategic transactions; legal, regulatory, tax and economic developments affecting Juniper’s business; the unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism, outbreak of war or hostilities or current or future pandemics or epidemics, as well as Juniper’s response to any of the aforementioned factors; general economic and political conditions globally or regionally, including the impact of a U.S. federal government shutdown or sovereign debt default and adverse changes in China-Taiwan relations and any impact due to armed conflicts (such as the continuing conflict between Russia and Ukraine and the escalation of Middle East conflicts and wars, as well as governmental sanctions imposed in response); rising interest rates; inflationary pressures; monetary policy shifts; business and economic conditions in the networking industry; changes in overall technology spending by our customers; the network capacity and security requirements of our customers; contractual terms that may result in the deferral of revenue; the timing of orders and their fulfillment; continuing manufacturing and supply chain challenges and logistics costs, constraints, changes or disruptions; availability and pricing of key product components, such as semiconductors; delays in scheduled product availability; order cancellations; adoption of or changes to laws, regulations, standards or policies affecting our operations, products, services or the networking industry; product defects, returns or vulnerabilities; significant effects of tax legislation and judicial or administrative interpretation of new tax regulations, including the potential for corporate tax increases and changes to global tax laws; legal settlements and resolutions, including with respect to enforcing our proprietary rights; the potential impact of activities related to the execution of capital return, restructurings and product rationalization; the impact of import tariffs and changes thereto; currency exchange rates; and other factors listed in Juniper Networks’ most recent report on Form 10-Q or 10-K filed with the Securities and Exchange Commission. Note that our estimates as to the tax rate on our business are based on current tax law and regulations, including current interpretations thereof, and could be materially affected by changing interpretations as well as additional legislation and guidance. All statements made in this 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 made in this release in the event facts or circumstances subsequently change after the date of this release. We have not filed our Form 10-Q for the quarter ended September 30, 2024. As a result, all financial results described in this earnings release should be considered preliminary, and are subject to change to reflect any necessary adjustments or changes in accounting estimates, that are identified prior to the time we file our Form 10-Q.

Use of Non-GAAP Financial Information

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 Juniper Networks’ 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 of Non-GAAP Financial Measures" section of this press release. The following tables and reconciliations can also be found on our Investor Relations website at http://investor.juniper.net.