Juniper reported net revenues of $1.22 billion, flat year-over-year and an increase of 11 percent sequentially.
Non-GAAP net income was $191.6 million, or 50 cents per diluted share, a decrease of 8 percent year-over-over and an increase of 35 percent sequentially.
Security product revenue for the quarter was $78 million, down 27 percent year-over-year and up 7 percent sequentially.
Regarding security, CEO Rami Rahim said, “We did experience another difficult quarter. Sequentially, we’re up over Q1, but certainly not where it would need to be for us to be happy. We’re disappointed with the result.”
He added that the company’s security business will be in transition for the remainder of the year with growth expected in 2017.
In addition, the company’s gross margins were down, driven by a weaker Euro, a “challenging pricing environment” in Europe and the Middle East, and some drain from the recent purchase of BTI Systems.
Juniper CFO Ken Miller added that the BTI acquisition “did have a slight negative impact on both gross margin and operating margin in Q2.”
Juniper reported a non-GAAP operating margin for the second quarter 2016 of 22.5 percent, a decrease from 25.2 percent in the second quarter of 2015. Juniper expects operating margins for the full year 2016 to decline slightly, relative to the full year 2015.
As he did at Juniper’s Investor Day in May, Rahim bragged about the company’s software-defined networking products. He said, “Contrail is critical in enabling our customers’ IT and business evolution to the cloud.”