Juniper Networks reports net loss

Juniper Networks recorded a large net loss for the second quarter but managed to eke out operating profit in line with lowered guidance. In mid afternoon trading, Juniper shares rose almost 3% on news of an analyst upgrade from Robertson Stephens.

The router company reported revenue of $202 million for the second quarter, up from $113 million last year but down about 39% from the first quarter.

Juniper posted operating income of $29.3 million, or 9¢ a share, in line with the reduced estimates of analysts surveyed by First Call/Thomson Financial. In the year-ago quarter, the company recorded operating profit of $28.6 million, or 8¢ a share.

Juniper’s net loss, which includes one-time charges, was $37.1 million, or 12¢ a share, compared to net income of $19.6 million, or 6¢ per share, in the second quarter of 2000.

The one-time items included $12.3 million from the amortization of goodwill and other intangible assets, $18.8 million in amortization of deferred compensation, $12.3 million in restructuring charges, and $32.6 million in writedowns of equity investments. Some of the companies Juniper has investments in include Greenwich Technology Partners, Calient and ONI Systems.

The one-time charges related to restructuring and investment writedowns were slightly higher than the $45 million the company forecast in June.

While quarterly operating expenses were up significantly from the year-ago period, they were down almost $10 million sequentially to $87.5 million. That was a result of discretionary spending and job cuts, a Juniper spokeswoman said. The company expects more savings in the third quarter.

“The second quarter represents an example of our priorities during these times—customer growth, financial discipline, and continued investment in innovation,” said a statement by Scott Kriens, Juniper’s chairman and CEO.

In early June, Juniper lowered its second quarter revenue estimate by $100 million and it operating profit estimate by 15¢ a share.

In the statement accompanying its financial tables, Juniper did not issue any guidance for the second half of the year. Analysts surveyed by First Call/Thomson Financial are forecasting net income of 9¢ a share in the September quarter.

According to Robertson Stephens analyst Paul Johnson, who upgraded Juniper to a “strong buy,” in August Juniper will begin beta testing of a new router that has four times the capacity of its M160 product.