Juniper Networks said that deployment delays among large cloud customers is going to hurt its first quarter results.
The networking company, which reported fourth quarter earnings and sales that were better than estimates, cut its first quarter outlook.
In a statement, Juniper said that its first quarter will take a hit due to "ongoing deployment delays" among large cloud customers. Juniper added that its large cloud customers are going through an architecture transition. Some Juniper customers are transitioning to the company's next-gen platform.
Juniper said that it expects gross margins to be under pressure because of its product mix and lower volume. Juniper said its revenue for the first quarter will be about $1.05 billion, give or take $30 million. Non-GAAP first quarter earnings about 25 cents a share in the first quarter, give or take 3 cents a share.
Wall Street was expecting first quarter non-GAAP earnings of 42 cents a share on revenue of $1.15 billion.
The outlook confirmed fears about Juniper's quarters ahead. Cowen analyst Paul Silverstein said ahead of the earnings report:
We see what we believe to be an increasingly challenging competitive landscape in not just service provider routing but also significant challenges to Juniper's gaining and sustaining share in the cloud market.
For the fourth quarter, Juniper reported a net loss of $148.1 million, or 40 cents a share, due to tax charges. Non-GAAP earnings for the fourth quarter were 53 cents a share on revenue of $1.24 billion.
Wall Street was expecting Juniper to report fourth quarter non-GAAP earnings of 52 cents a share on revenue of $1.23 billion.
For 2017, Juniper reported net income of $306.2 million, or 80 cents a share, on revenue of $5.03 billion.