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Juniper Networks Revenues Rise in Q1

Juniper Networks (NYSE:JNPR) had a busy first quarter, launching new enterprise, mobility and service provider products.

Juniper reported first quarter 2011 revenues of $1.10 billion, up by 21 percent on a year-over-year basis. Net Income was reported at $130 million, or $0.24 per share. Moving forward Juniper provided second quarter 2011 guidance for revenue to range between $1.13 billion and $1.18 billion.

During the quarter, Juniper announced its new QFabric data center solution. The goal of QFabric is to flatten networks, increase speed and lower overall latency.

The QFabric solution however, could be having a negative impact on Juniper's EX switching product lineup. Juniper CFO Robyn Denholm reported that Juniper's EX switching line generated 25 percent year-over-year growth.

"We think there is some near-term pause in Q1 at the EX4500, our 10-gig top-of-rack switch as customers waited for the QFX 3500," Denholm said during the company's earnings call. "With the new product now shipping, we believe this effect was a short-term anomaly."

Kevin Johnson CEO of Juniper also addressed the issue of how QFabric is impacting EX sales.

"My experience is that when you introduce a new technology and new architecture like that and customers have a high level of interest in it, certainly, there may be some implications near term on existing products that, as they evaluate, we get those design wins," Johnson said. "So key for us is to secure design wins for QFabric."

Johnson noted that Juniper has big aspirations in the growth agenda that he is driving in switching and QFabric. He added that Juniper's wireless LAN business, through the acquisition of Trapeze, is also a key element of that growth. Juniper acquired Trapeze for $152 million in November of 2010.

Rival networking vendor Cisco has also experienced an issue with new product introductions impacting existing products. Cisco's switching business declined by 7 percent in its last quarter, due to new product introduction and the transition to new platforms.

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.