Group 1 - The Trump administration is expected to maintain a rigorous stance on mergers and acquisitions (M&A), continuing the scrutiny established under the Biden administration [2][4] - The Department of Justice (DOJ) has already taken action by suing to block a $14 billion acquisition of Juniper Networks by Hewlett Packard Enterprise, citing concerns over reduced competition [3][4] - Strict guidelines from the Federal Trade Commission (FTC) and DOJ focus on preventing major deals that could lessen competition and reduce consumer options [5][6] Group 2 - Investment banks had anticipated a more favorable environment for M&A under the Trump administration, hoping for looser restrictions that could lead to increased deal activity and advisory revenue [7][8] - Despite the scrutiny on large tech deals, there may still be opportunities in other sectors, such as banking, where the Federal Deposit Insurance Corporation has rescinded a policy that could encourage large bank mergers [9] - Goldman Sachs has seen an 88% increase in stock price since November 2023, while Morgan Stanley and JPMorgan Chase are trading at elevated price to tangible book values compared to historical averages, prompting considerations for profit-taking [10]

Financial Data and Key Metrics Changes - The company reported Q1 revenue of $7.9 billion, representing a 17% year-over-year growth, marking the fourth consecutive quarter of accelerated revenue growth [36][38] - Non-GAAP diluted net earnings per share were 49 cents, consistent with the company's outlook range [41] - Non-GAAP gross margin was 29.4%, down 680 basis points year-over-year, primarily due to a higher mix of server revenue and lower contributions from Intelligent Edge [39] - Free cash flow was negative $877 million, in line with normal seasonal patterns [54] Business Line Data and Key Metrics Changes - Server revenue reached $4.3 billion, up 30% year-over-year, although it fell sequentially due to the timing of AI systems deals [42] - Intelligent Edge revenue was $1.1 billion, up 2% quarter-over-quarter but down 4% year-over-year [48] - Hybrid cloud revenue grew 11% year-over-year to $1.4 billion, although it declined 12% sequentially [50] - Financial services generated $873 million in revenue, up 2% year-over-year and flat quarter-over-quarter [53] Market Data and Key Metrics Changes - The company experienced double-digit year-over-year orders growth across all key geographies and products, including campus switching [20] - AI systems revenue was $900 million in Q1, up from about $400 million last year, but down sequentially as expected due to chip availability and customer readiness [44][24] - The AI systems backlog was $3.1 billion, up 29% quarter-over-quarter [22] Company Strategy and Development Direction - The company plans to reduce its employee base by 5% over the next twelve to eighteen months, targeting approximately 2,500 positions to better align its cost structure with its business mix and long-term strategy [16] - The company is committed to closing the Juniper acquisition, which is expected to deliver at least $450 million in gross annual run rate synergies to shareholders within three years [10] - The company aims to leverage its global supply chain to mitigate the impact of recent tariff policies [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that while Q1 performance met expectations, execution could have been better, particularly in the server segment [13][33] - The company expects continued pressure on server operating margins in the near term but anticipates improvements in the back half of fiscal 2025 [15][34] - Management expressed confidence in achieving revenue growth of 7% to 11% for fiscal 2025, with a significant portion weighted towards the second half [60] Other Important Information - The company is implementing cost-saving measures, targeting discretionary spending, and has reduced non-GAAP operating expenses to a record low of 19% of revenue [40] - The company expects to achieve at least $350 million in gross savings by fiscal 2027, with about 20% of the savings expected by the end of this year [57] Q&A Session Summary Question: How much of the operating profit dollar headwind is from tariff assumptions? - Management indicated that the guidance includes a seven cents impact from tariffs for the year, with four cents expected in Q2, primarily affecting the server business [91][92] Question: What gives confidence in revenue growth and operating margin expansion in the back half of the year? - Management highlighted three critical areas: improved server execution, mitigation of tariffs, and the impact of the cost efficiency program as drivers for profitability [122] Question: How is the customer mix changing? - Management noted a balanced approach targeting both service provider model builders and enterprise customers, with a focus on maintaining a solid pipeline and addressing the needs of various segments [110][112]

Core Insights - Hewlett Packard Enterprise (HPE) reported a 16% year-over-year revenue increase to $7.9 billion for Q1 fiscal 2025, exceeding analyst estimates [2][3] - Non-GAAP earnings per share (EPS) were $0.49, slightly below the projected $0.50, indicating operational challenges despite revenue growth [2][3] - The company faced significant cash flow pressures, with free cash flow dropping to -$877 million, and gross margins decreased by 6.8 percentage points [3][8] Financial Performance - Total revenue for Q1 2025 reached $7.9 billion, up from $6.8 billion in Q1 2024, reflecting a 16% increase [3][6] - Server segment revenue increased by 29% to $4.3 billion, although operating margins fell from 11.4% to 8.1% [6] - The hybrid cloud segment grew by 10% in revenue, with operating margins improving from 4% to 7% [7] - The financial services segment showed incremental revenue growth and an increase in operating margins to 9.4% [7] - The Intelligent Edge division experienced a 5% revenue decline [7] Strategic Focus - HPE specializes in edge-to-cloud solutions, with a focus on the HPE GreenLake platform for enterprise IT transformation [4] - The company is investing in AI and supercomputing advancements, alongside strategic acquisitions like Juniper Networks to enhance its competitive edge [5] Future Outlook - Management projects fiscal year revenue growth between 7% and 11%, focusing on enhancing HPE GreenLake capabilities and leveraging AI infrastructure [9] - Potential margin pressures from AI advancements and the impact of the Juniper Networks acquisition present strategic risks [9][10]

Core Viewpoint - Hewlett Packard Enterprise (HPE) shares fell 16% in extended trading after the company provided quarterly and full-year guidance that was below consensus expectations [1][3]. Financial Performance - HPE's revenue increased by 16% year over year for the fiscal first quarter, reaching $7.85 billion, compared to $7.82 billion expected by analysts [1][5]. - The company reported a profit of $598 million, or 44 cents per share, up from $387 million, or 29 cents per share, in the same quarter a year earlier [1]. Future Guidance - For the fiscal second quarter, HPE projected adjusted earnings per share between 28 cents and 34 cents, with revenue expected to be between $7.2 billion and $7.6 billion, significantly lower than the analyst consensus of 50 cents per share on $7.93 billion in revenue [3]. - For the 2025 fiscal year, HPE forecasted adjusted earnings per share of $1.70 to $1.90, while analysts had predicted $2.13 per share [4]. Cost Reduction Measures - HPE announced a cost reduction program that will involve layoffs, aiming for $350 million in gross savings by the 2027 fiscal year, affecting approximately 2,500 employees [2]. Legal Challenges - The U.S. Justice Department filed a lawsuit to block HPE's proposed $14 billion acquisition of Juniper Networks, with a trial expected to begin in July [3].

Merger and Acquisition Risks - Juniper Networks entered into a Merger Agreement with Hewlett Packard Enterprise Company (HPE) on January 9, 2024, with stockholder approval received on April 2, 2024[133]. - The Merger is subject to various closing conditions, including regulatory approvals and the absence of legal prohibitions, with an Outside Date extended to April 9, 2025[141]. - The U.S. Department of Justice filed a complaint on January 30, 2025, seeking to prevent the Merger, which could delay or prevent its completion[138]. - The completion of the Merger may be impacted by market uncertainties, potentially leading to reduced customer purchases and operational disruptions[135]. - Juniper Networks faces risks related to its business relationships and financial condition during the pendency of the Merger, including potential distractions for management and employees[135]. - The cash consideration under the Merger Agreement is fixed and will not adjust for changes in Juniper's business or market conditions[142]. - If the Merger is not completed, Juniper's stockholders may face additional risks, including a decline in stock price and loss of business opportunities[135]. - Regulatory approvals may impose conditions that could delay the Merger or require lengthy negotiations[139]. - The Merger could limit Juniper's ability to pursue alternative business opportunities during the pending period[135]. - The potential for litigation related to the Merger may incur additional costs and impact Juniper's financial results[135]. - The company is facing litigation related to the Merger, which could delay or prevent its consummation and negatively impact business operations and financial performance[143]. Financial Performance and Revenue Risks - Quarterly results are unpredictable, with revenues and operating results subject to significant fluctuations, potentially affecting stock price if expectations are not met[146]. - A material portion of revenues is derived from a limited number of customers, increasing risks related to financial conditions and purchasing behaviors[151]. - The company expects gross margins and operating margins to vary over time, influenced by factors such as pricing competition and cost increases[149]. - Long sales and implementation cycles for products may cause significant revenue and operating result variations from quarter to quarter[158]. - The backlog of orders may not accurately indicate future revenues due to macroeconomic events and supply chain challenges[150]. - Economic instability, inflation, and geopolitical tensions could adversely affect demand for products and overall business performance[153]. - Revenue recognition is contingent on the timing of product orders and deliveries, leading to potential significant variations in operating results[159]. - Services revenue, including SaaS revenue, accounted for 40%, 35%, and 33% of total revenue in 2024, 2023, and 2022, respectively[160]. - Revenue recognition for software and support services is based on deferred revenue from previous contracts, which may lead to fluctuations in reported revenue[161]. - A significant portion of business revenue relies on the growth of secure IP infrastructure, with potential adverse effects from reduced customer spending on IP systems[162]. Supply Chain and Operational Risks - Supply chain dependencies on contract manufacturers and limited source suppliers pose risks to production schedules and cost management[176]. - Manufacturing operations are at risk due to potential supply shortfalls, delays, and quality control issues, which could lead to increased manufacturing times and shipping delays[178]. - The company relies on single or limited sources for many components, which could result in product delivery suspensions or increased redesign costs if suppliers discontinue components[178]. - Supply chain disruptions, including increased component costs and logistics costs, could adversely affect sales, earnings, and liquidity[178]. - Demand forecasts provided to manufacturers may lead to excess inventory or raw material liabilities if overestimated, or production delays if underestimated[178]. - The development of alternative sources for components is time-consuming and costly, potentially impacting the ability to meet customer demands during shortages[178]. - Global health emergencies have previously caused production delays and may continue to negatively impact business operations and revenue recognition[178]. - Political and economic tensions between China and Taiwan pose significant risks to operations and supply chains, potentially harming financial conditions and market performance[179]. Cybersecurity and Legal Risks - Cybersecurity risks, including data breaches and attacks, could compromise proprietary information and disrupt operations, leading to reputational and financial harm[180]. - The company faces potential negative impacts from ESG oversight and reporting, leading to increased general and administrative expenses and management time[192]. - The company was involved in litigation resulting in a settlement payment of $11.8 million to the SEC in August 2019 related to the U.S. Foreign Corrupt Practices Act[193]. - Increased patent litigation from non-practicing entities may require the company to absorb litigation costs, negatively affecting financial condition and results of operations[194]. - The company is subject to regulations that could harm operating results, including compliance with local content and safety certification requirements[198]. - The SEC mandates the company to report on the use of "conflict minerals" in its supply chain, which could lead to increased compliance costs[199]. - Environmental laws may require the company to reengineer products to comply with new regulations, potentially disrupting operations and increasing costs[200]. - The company has suspended operations in Russia and certain regions of Ukraine due to sanctions, impacting its ability to sell products in those areas[210]. - The Uyghur Forced Labor Prevention Act requires importers to prove goods are not made with forced labor, which could affect the company's supply chain and reputation[211]. - The company must comply with evolving privacy and data protection laws, which can be costly and may delay product development[212]. Financial and Tax Risks - As of December 31, 2024, the company's goodwill was $3,734.3 million, and purchased intangible assets were $42.6 million, with potential impairment risks affecting future earnings[214]. - The company has $1,700.0 million in aggregate principal amount of outstanding senior notes as of December 31, 2024, and a new credit agreement provides for a five-year $500.0 million unsecured revolving credit facility[224]. - The company may face significant costs and liabilities due to evolving data protection regulations, including the EU GDPR and the new Digital Personal Data Protection Act in India[214]. - Future effective tax rates may be volatile due to changes in tax legislation and examination outcomes, potentially impacting income tax expense and cash flows[216]. - The company is subject to risks from international operations, including economic conditions, regulatory changes, and geopolitical tensions, which could adversely affect financial performance[219]. - The company must maintain a leverage ratio no greater than 3.0x, which may limit its ability to engage in favorable business activities[227]. - The company’s investments are subject to various risks, including credit, liquidity, and market risks, which could adversely affect liquidity and financial condition[229]. - The company is required to improve financial and managerial controls to manage growth effectively, with potential impacts on investor perception and stock price if weaknesses are identified[230]. - The company may incur additional costs if exclusive forum provisions in its bylaws are found to be unenforceable, impacting business operations[231]. - Changes in global tax laws, including the OECD's global minimum tax, could adversely affect the company's tax liability and financial results[217].

Financial Performance - Fourth quarter 2024 net revenues were $1,404.1 million, representing a 3% year-over-year increase and a 5% sequential increase[3]. - GAAP net income for the fourth quarter was $162.0 million, a 30% year-over-year increase, resulting in diluted earnings per share of $0.48[4]. - Full-year 2024 net revenues were $5,073.6 million, a 9% year-over-year decrease[5]. - GAAP net income for the full year was $287.9 million, a 7% year-over-year decrease, resulting in diluted earnings per share of $0.86[6]. - Total net revenues for Q4 2024 reached $1,404.1 million, a 2.7% increase from $1,364.8 million in Q4 2023[21]. - Product revenues were $870.2 million, up from $858.6 million year-over-year, while service revenues increased to $533.9 million from $506.2 million[21]. - Net income for Q4 2024 was $162.0 million, compared to $124.3 million in Q4 2023, representing a 30.3% increase[21]. - Net income for the twelve months ended December 31, 2024, was $287.9 million, a decrease of 7.4% from $310.2 million in 2023[45]. Margins and Expenses - Non-GAAP operating margin for the fourth quarter was 19.2%, up from 18.3% in Q4 2023[3]. - Operating income for the year was $291.8 million, down from $470.1 million in the previous year, indicating a decrease of 38%[21]. - Non-GAAP operating income for Q4 2024 was $268.9 million, compared to $250.2 million in Q4 2023, showing a growth of 7.1%[30]. - Research and development expenses for the year totaled $1,150.5 million, slightly up from $1,144.4 million in the previous year[21]. - Share-based compensation expense increased to $290.8 million in 2024 from $279.4 million in 2023, reflecting a rise of 4.8%[45]. Cash and Investments - Total cash, cash equivalents, and investments as of December 31, 2024, were $1,770.0 million, an increase from $1,324.3 million as of December 31, 2023[9]. - Cash and cash equivalents rose to $1,224.3 million in 2024, up from $1,068.1 million in 2023, representing a growth of 14.6%[43]. - Net cash provided by operating activities was $788.1 million for 2024, down from $872.8 million in 2023, indicating a decline of 9.7%[45]. Assets and Liabilities - Total assets increased to $10,008.0 million as of December 31, 2024, compared to $9,518.5 million in 2023, reflecting a growth of 5.1%[43]. - Total current liabilities increased to $2,642.0 million in 2024, compared to $2,104.0 million in 2023, marking a rise of 25.6%[43]. - Long-term debt decreased to $1,215.7 million in 2024 from $1,616.8 million in 2023, a reduction of 24.8%[43]. - Inventory levels decreased to $830.1 million in 2024 from $952.4 million in 2023, a decline of 12.8%[43]. - Total stockholders' equity increased to $4,784.2 million in 2024, up from $4,492.7 million in 2023, showing a growth of 6.5%[43]. - Deferred revenue increased to $1,228.4 million in 2024 from $1,130.0 million in 2023, representing an increase of 8.7%[43]. Strategic Initiatives - The company plans to pay a cash dividend of $0.22 per share on March 24, 2025[11]. - The proposed merger with Hewlett Packard Enterprise is valued at approximately $14 billion, with a cash transaction of $40.00 per share[2]. - The company will not provide financial guidance due to the pending acquisition by HPE[12]. Regional Performance - The Americas region generated $888.9 million in revenues for Q4 2024, up from $849.7 million in Q4 2023, marking a 4.3% increase[28]. - Cloud vertical revenues increased to $368.1 million in Q4 2024 from $317.3 million in Q4 2023, a growth of 16.0%[26]. Gross Margin - Gross margin for Q4 2024 was $838.7 million, compared to $807.2 million in Q4 2023, reflecting improved operational efficiency[21].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_________ to_________ | --- | --- | --- | |----------------------------------------------------------------|----------------------------------------------- ...

Financial Performance - Net revenues for Q3 2024 were $1,331.0 million, a decrease of 5% year-over-year, but an increase of 12% sequentially[3]. - GAAP net income was $92.6 million, representing a 22% increase year-over-year and a 172% increase sequentially, resulting in diluted net income per share of $0.28[4]. - Total net revenues for the three months ended September 30, 2024, were $1,331.0 million, a decrease of 4.7% compared to $1,397.8 million for the same period in 2023[18]. - Net income for the three months ended September 30, 2024, was $92.6 million, compared to $76.1 million in the same period last year, with diluted net income per share rising to $0.28 from $0.24[22]. - Net income for the nine months ended September 30, 2024, was $125.9 million, down from $185.9 million in the same period of 2023, representing a decrease of about 32.4%[36]. Revenue and Orders - Total product orders grew nearly 60% year-over-year, with strong demand particularly from cloud customers[5]. - The Americas region generated $844.1 million in revenues for the three months ended September 30, 2024, compared to $836.5 million in the previous year[21]. - The Cloud segment reported revenues of $349.6 million for the three months ended September 30, 2024, an increase from $269.6 million in the same period last year[20]. Operating Metrics - Non-GAAP operating margin was 15.0%, a decrease from 17.5% in Q3 2023, but an increase from 10.9% in Q2 2024[3]. - Operating income for the three months ended September 30, 2024, increased to $94.1 million, compared to $87.6 million for the same period in 2023, resulting in an operating margin of 7.1%[22]. - The company reported a non-GAAP operating income of $200.0 million for the three months ended September 30, 2024, compared to $129.7 million in the same period last year[22]. Cash Flow and Investments - Net cash flows provided by operations for Q3 2024 were $192.2 million, down from $329.2 million in Q3 2023[7]. - Cash flows from operating activities decreased to $508.3 million from $863.7 million, a decline of approximately 41.1%[36]. - Total cash, cash equivalents, and investments as of September 30, 2024, were $1,562.9 million, up from $1,418.0 million a year ago[6]. - Long-term investments rose significantly from $116.8 million to $331.2 million, an increase of about 184.5%[35]. Expenses - Research and development expenses for the three months ended September 30, 2024, were $290.6 million, slightly up from $288.5 million in the same period last year[18]. - Total operating expenses for the three months ended September 30, 2024, were $679.3 million, down from $722.8 million in the same period last year[18]. - Share-based compensation expense increased to $211.4 million from $197.6 million, an increase of approximately 6.4%[36]. Dividends and Stockholder Equity - A cash dividend of $0.22 per share has been declared, to be paid on December 23, 2024[9]. - Total stockholders' equity increased from $4,492.7 million to $4,642.7 million, an increase of approximately 3.3%[35]. Future Outlook and Guidance - The proposed merger with Hewlett Packard Enterprise is expected to close in late 2024 or early 2025, with an equity value of approximately $14 billion[2]. - Juniper Networks will not provide financial guidance for 2024 due to the pending transaction with HPE[10]. - The company anticipates continued focus on market expansion and new product development in the upcoming quarters[24]. Financial Adjustments and Transparency - The company plans to continue providing non-GAAP financial measures to enhance transparency and comparability for investors[26]. - The company excluded acquisition-related charges and other unique items from its non-GAAP financial measures to better reflect ongoing operations[28][30]. - The company reported a loss on privately-held investments of $13.1 million, down from $92.0 million in the previous year[36].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_________ to_________ Commission file number: 001-34501 JUNIPER NETWORKS, INC. (Exact name of registrant as specified in its charter) (State or other jurisdicti ...

Exhibit 99.1 Investor Relations: Jess Lubert Juniper Networks (408) 936-3734 jlubert@juniper.net Media Relations: Penny Still Juniper Networks +441372385692 pstill@juniper.net JUNIPER NETWORKS REPORTS PRELIMINARY SECOND QUARTER 2024 FINANCIAL RESULTS SUNNYVALE, Calif., July 25, 2024 - Juniper Networks (NYSE: JNPR), a leader in secure, AI-Native Networks, today reported preliminary financial results for the three months ended June 30, 2024. Proposed Merger with Hewlett Packard Enterprise As announced on Janu ...