Juniper Networks, Inc. Reports Q2’06 Financial Results

27.07.06

Q2’06 Net Revenue of 7.5M, up 15% from Q2’05

Juniper Networks, Inc. (NASDAQ: JNPR) today reported its revenue results for the quarter ended June 30, 2006.

Net revenues for the second quarter of 2006 were 7.5 million, compared with 3.0 million for the same quarter last year, an increase of 15 percent.

Net cash increased 0M during the second quarter of 2006 to .25 billion.

“We're pleased with the results for the quarter, the confidence our customers continue to place in Juniper and the strength of the business,” commented Scott Kriens, chairman and CEO, Juniper Networks. “We see continued and expanding opportunity in the marketplace as we participate in the accelerating convergence on IP and benefit from the resulting demand for the unique capabilities of Juniper.”

Capital expenditures and depreciation during the second quarter of 2006 were .2 million and .6 million, respectively.

The Company’s market capitalization has declined since March 31, 2006, and therefore the Company is evaluating the carrying value of certain long-lived assets, consisting primarily of .9 billion of goodwill recorded on its balance sheet at June 30, 2006. Pursuant to accounting rules, the majority of the goodwill was recorded based on stock prices at the time merger agreements were executed and announced. The Company expects to record reductions in the carrying value of goodwill and long-lived assets for the Service Layer Technologies segment of approximately .3 billion for the quarter ended June 30, 2006. Should the Company's market capitalization decrease further, it is possible that there could be additional reductions in goodwill in future periods.

In a separate announcement, Juniper today announced that its Board of Directors authorized a stock repurchase program of up to billion. Purchases under this program will be subject to a review of the circumstances in place at the time, and will not be implemented until after the Company has filed its Form 10-Q for the period ending June 30, 2006

The Audit Committee of the Company's Board of Directors is conducting an independent investigation regarding stock options. Although the investigation is not complete, and the committee is continuing its review of the matters, the committee has reached a preliminary conclusion that the actual measurement dates for financial accounting purposes of certain stock option grants issued in the past differ from the recorded grant dates of such awards. Accordingly, the Company believes it will record additional non-cash charges for stock-based compensation expense, but is not yet able to determine the amount of such charges or the resulting tax and accounting impact of these actions or which periods, if any, would require restatement. Accordingly, the company is not providing detailed GAAP or Non-GAAP financials for the quarter ended June 30, 2006. In addition, the Company will not file its quarterly report on Form10-Q for the quarter ended June 30, 2006 until after completion of the investigation, and the Company does not expect the investigation to be completed until after the date the Form 10-Q is required to be filed.

Highlights:
Juniper’s focus on innovation was reflected in a number of key product initiatives this quarter.
· For the Service Provider market, Juniper announced the first phase of its Ethernet portfolio providing high-density, low cost Ethernet to existing M- and T-series routing platforms. In addition, the E320 broadband services router was confirmed to comply with two key industry open standards, TR-101 and Layer 2 Control Protocol (L2CP). Juniper also announced the Open IPTV and Multiplay Initiative to enable providers to use open standard Juniper technology to better deploy IPTV and multi-play services.
· On the enterprise side Juniper delivered visibility and reporting enhancements to its WXTM Central Management SystemTM (CMSTM) software and introduced its next generation Intrusion Detection and Prevention (IDP) platform, as well as new NetScreen Security Management software designed to provide increased application visibility and control across the network.
· This week Juniper introduced the M120 platform setting a new standard for the intelligent multi-service edge and announced the first new set of features on the Odyssey Access Client and Steel-Belted Radius products since the close of the Funk acquisition, delivering unmatched network access policy management and user authentication.
· During the quarter, Juniper announced an agreement with Microsoft to deliver high-performance security solutions that enhance protection for IP and IPTV networks, services and applications. As part of this agreement Juniper can offer IPTV network security solutions to customers of Microsoft® TV IPTV Edition.

Customer confidence was reflected in a number of significant service provider wins including FastWeb in Italy for IPTV, Telge Energi in Sweden for E320s and Global Crossing in the US for the T-series. In addition, momentum in the enterprise continued with wins at organizations such as MGM Mirage and Methodist Hospital in the US, as well as the Finnish Defense Force and Australia’s Commonwealth Bank.

Conference Call and Web cast:
The company’s conference call will be archived on the Juniper Networks website until August 19, 2006. A replay will be accessible by telephone on July 19, 2006 after 4:00 p.m. Pacific Time through July 26, 2006 by dialing +1 402-977-9140, reservation number, 21298192. The replays will be available 24 hours/day, including weekends.

About Juniper Networks, Inc.
Juniper Networks is the leader in enabling secure and assured communications over a single IP network. The company’s purpose-built, high performance IP platforms enable customers to support many different services and applications at scale. Service providers, enterprises, governments and research and education institutions worldwide rely on Juniper Networks to deliver products for building networks that are tailored to the specific needs of their users, services and applications. Juniper Networks' portfolio of proven networking and security solutions supports the complex scale, security and performance requirements of the world’s most demanding networks. Additional information can be found at www.juniper.net.