Juniper Networks, a cloud service provider based in the San Francisco Bay Area, United States, is to lay off approximately 440 people globally at a cost of $59 million. Severance and termination costs will most likely total $40 million. In addition, Juniper plans to spend additional restructuring and associated expenditures of roughly $19 million, according to a recent filing with the US Securities and Exchange Commission (SEC). The company did not specify which business divisions would be affected by the layoffs.
Depending on local laws and consultation procedures, the majority of the layoffs are anticipated to be completed by the end of Q1 FY24. As part of a reorganisation strategy Juniper outlined earlier this year, layoffs have been implemented.
In the recent filing, Juniper stated that the restructuring plan is “the result of a thorough review of the company’s business objectives, and is intended to focus on realigning resources and investments in long-term growth opportunities.” Meanwhile, the strategy, according to the firm, “will also enable it to continue to prudently manage operating expenses in order to deliver improved operating margin,” the filing added.
According to ETTelecom.com, the network equipment manufacturer, which was an early user of artificial intelligence (AI), reported $1.43 billion in revenue in the second quarter, up 13 per cent year on year and 4 per cent sequentially. In the second quarter, its cloud business fell 6 per cent year on year, while its service provider business climbed modestly by 1 per cent.
In the second quarter earnings call, the company’s chief executive Rami Rahim stated that he is very pleased by the growth they are experiencing in their enterprise business, which, for the third straight quarter, represented both the largest and fastest-growing vertical. He also said that the firm has generated record revenue results, accounting for more than 45 per cent of their overall revenue.
“We have less visibility and our revenue results are probably going to be under pressure over the next several quarters due to the digesting of earlier purchases and the unpredictable timing of client installations, especially among some of our bigger cloud customers,” Juniper’s chief executive Rahim said as per Times of India. Hence, they are lowering their projection for full-year sales growth in light of the above trends. “We are still dedicated to generating more profitability, and we still anticipate generating an operating margin improvement of more than 100 basis points in 2023,” Rahim had previously stated reports add.
Several other telecom firms, such as Vodafone, BT, Crown Castle, and Sweden’s Ericsson, have also announced their plans to downsize their workforce over the next years.
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