Verizon's FiOS fuels Juniper’s top line

Despite an uncertain market, Juniper Networks reported a healthy third quarter Thursday thanks in large part to its role supplying equipment for Verizon Communications’ fiber-to-the-premises network.

After three or four quarters of work on Verizon’s FiOS network, Juniper was finally able to report the revenue for that work for the first time in the third quarter. Though it’s unknown how much revenue was related to FiOS specifically, Verizon was Juniper’s biggest customer by far in the quarter, contributing $123 million, or 13% of the vendor’s total revenue.

Verizon uses Juniper’s E-series broadband routers for its FTTP network, and Verizon Business (the former MCI) is believed to use Juniper’s MX Ethernet service switches. This month Juniper announced plans to push some functions of the E-series routers into its Junos operating system, allowing that functionality to be applied to edge networks as well.

Juniper’s overall revenue was up 29% from a year earlier and up 8% sequentially to $947 million, exceeding expectations.

The results led new CEO Kevin Johnson to say he is “cautiously optimistic” about the future despite broad economic uncertainty among many of Juniper’s peers.

“There’s a very distinct market in the overall communications industry for high-performance networking,” Johnson said. “People are buying only what they need, and we’re responding to those needs.”

Tellabs, another supplier to Verizon’s FTTP network, also benefited from a FiOS-based revenue boost in the third quarter, but because Tellabs supplies a much less profitable part of the network – the access and customer premises equipment – the vendor is backing out of the next phase of the FiOS deployment.

On its earnings call Thursday, Juniper reiterated its expectations for full-year revenue but raised its outlook slightly for full-year earnings, from between $1.14 and $1.17 per share to between $1.17 and $1.20 per share.