(Updates with closing shares in second paragraph.)
July 27 (Bloomberg) -- Juniper Networks Inc. tumbled the most in more than a decade after the second-largest maker of Internet networking equipment reported sales and profit that missed estimates after customers put off buying new gear.
Juniper’s shares plunged $6.51, or 21 percent, to $24.66 at 4 p.m. on the New York Stock Exchange, for the biggest drop since November 2000. The stock has fallen 33 percent this year.
The company is grappling with slower-than-expected spending by some customers, including Internet carriers, which are delaying purchases and waiting for new products amid concerns about economic growth. Juniper’s revenue from service providers rose 18 percent in the second quarter, following a jump of 25 percent in the first quarter. Third-quarter and full-year sales growth also may be less than analysts projected.
“Across the board there was no shortage of concerns and cautionary comments,” said Jason Ader, an analyst at William Blair & Co. in Boston, who rates the stock “outperform.” “It’s a fairly large deterioration in their business.”
Second-quarter profit excluding some costs was 31 cents a share, the Sunnyvale, California-based company said yesterday in a statement. Revenue rose 15 percent to $1.12 billion from $978.3 million a year earlier. Analysts on average had projected profit of 33 cents a share and sales of $1.15 billion, according to data compiled by Bloomberg.
Third-quarter revenue will be $1.07 billion to $1.12 billion, Juniper said. Profit excluding some items will be 26 cents to 30 cents a share. Analysts projected $1.22 billion in sales and 38 cents in profit.
“We are cautious about the second half yet very optimistic about our position going into 2012,” Chief Executive Officer Kevin Johnson said on a conference call. “We look to grow faster than the market in 2011 while strengthening the innovation portfolio as we set up for 2012.”
Slower spending in Japan, lower-than-expected demand from carriers and economic concerns were among the reasons for caution, he said.
For the year, the company expects revenue growth of 12 percent to 14 percent, Chief Financial Officer Robyn Denholm said on the call. Before yesterday’s forecast, analysts had expected an increase of 18 percent.
The company forecast adjusted operating margin of 19 percent to 21 percent for the third quarter. Rohit Chopra, an analyst at Wedbush Securities in New York, had estimated operating margin would be about 23 percent.
--With assistance from Zachary Tracer in New York. Editors: Jillian Ward, Kenneth Wong
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