Juniper Networks, Inc. Reports Q2' 01 Financial Results Net Revenue $202.2M, up 79%; Pro forma EPS $0.09

Sunnyvale, CA - July 12, 2001 - Juniper Networks, Inc. (Nasdaq: JNPR), a leading provider of next-generation IP infrastructure systems, today reported its second quarter results for the period ending June 30, 2001.

Net revenues for the second quarter were $202.2 million, compared with $113.0 million for the same period last year, an increase of 79%. Pro forma net income was $29.3 million or $0.09 per share, compared with pro forma net income of $28.6 million or $0.08 per share for the second quarter of 2000.

Actual net loss for the second quarter, which includes amortization of goodwill and other purchased intangibles of $12.3 million, amortization of deferred compensation of $18.8 million, a restructuring charge of $12.3 million and write-downs in equity investments totaling $32.6 million, was $37.1 million or $0.12 per share, compared with net income of $19.6 million or $0.06 per share in the second quarter of 2000.

Net revenues for the first six months of 2001 were $534.3 million, compared with $176.9 million for the same six month period in 2000. Pro forma net income for the first six months of 2001 was $121.5 million or $0.35 per share, compared with pro forma net income of $39.1 million or $0.11 per share during the same six month period in 2000. Actual net income for the first six months of 2001 was $21.4 million or $0.06 per share, compared with actual net income of $27.7 million or $0.08 per share during the same six month period in 2000.

"The second quarter represents an example of our priorities during these times—customer growth, financial discipline, and continued investment in innovation," said Scott Kriens, Chairman and CEO of Juniper Networks. "We will continue to use our proven abilities in focus and execution to protect these principles," Kriens said.

About Juniper Networks, Inc.

Juniper Networks, Inc. is a leading provider of purpose-built systems that meet the scalability, performance, density, and compatibility requirements of rapidly evolving, optically enabled IP networks. The company's systems provide new IP infrastructure solutions for the world's leading service providers. Juniper Networks service, manufacturing teams, and IP engineers work closely with customers to build and support customer networks. The company is headquartered in Sunnyvale, California. For more information, please visit the Web site at http://www.juniper.net/.

Juniper Networks is registered in the U.S. Patent and Trademark Office and in other countries as a trademark of Juniper Networks, Inc. Internet Processor, Internet Processor II, JUNOS, JUNOScript, M5, M10, M20, M40, and M160 are trademarks of Juniper Networks, Inc. All other trademarks, service marks, registered trademarks, or registered service marks are the property of their respective owners.

Actual results could differ materially from those anticipated in forward-looking statements in this release as a result of certain factors, including those set forth in the risk factors described in the Company's SEC filings, including its recent Form 10K.

JUNIPER NETWORKS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)
		June 30, 2001		December 31, 2000
Assets		(unaudited)		(1)
Current assets:
Cash and cash equivalents		$ 512,415		$ 563,005
Short-term investments		494,953		581,738
Accounts receivable, net		137,121		176,535
Prepaid expenses and other current assets		31,486		27,269
Total current assets		1,175,975		1,348,547
Property and equipment, net		252,215		36,440
Long-term investments		618,760		450,568
Other long-term assets		204,789		267,574
Total Assets		$ 2,251,739		$ 2,103,129
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$ 62,947	$ 72,347
Other accrued liabilities	166,966	109,436
Deferred revenue	29,830	34,625
Total current liabilities	259,743	216,408
Convertible subordinated notes and other long-term liabilities	1,150,000	1,156,719
Common stock and additional paid-in capital	777,531	735,103
Deferred stock compensation	(68,773)	(111,813)
Accumulated other comprehensive income	16,054	10,963
Retained earnings	117,184	95,749
Total Liabilities and Stockholders' Equity	$ 2,251,739	$ 2,103,129
(1)  Derived from audited financial statements

JUNIPER NETWORKS, INC. PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (a) (In thousands, except per share amounts)
		Three Months Ended June 30,				Six Months Ended June 30,
		2001		2000		2001		2000
		(unaudited)				(unaudited)
Net revenues	$ 202,181		$ 113,028	$ 534,286		$ 176,914
Cost of revenues	80,480	40,752	194,221	65,853
Gross profit	121,701	72,276	340,065	111,061
Operating expenses:
Research and development	42,077	18,000	85,068	33,990
Sales and marketing	35,963	17,247	77,285	28,752
General and administrative	9,439	4,171	19,907	7,185
Total operating expenses	87,479	39,418	182,260	69,927
Operating income	34,222	32,858	157,805	41,134
Interest income, net	9,916	9,876	21,908	16,512
Equity in joint venture	(1,085)	-	(1,085)	-
Income before income taxes	43,053	42,734	178,628	57,646
Provision for income taxes	13,777	14,102	57,161	18,552
Net income	$ 29,276	$ 28,632	$ 121,467	$ 39,094
Basic net income per share	$ 0.09	$ 0.09	$ 0.38	$ 0.13
Shares used in computing basic net income per share	318,196	301,879	316,883	298,712
Diluted net income per share	$ 0.09	$ 0.08	$ 0.35	$ 0.11
Shares used in computing diluted net income per share	342,208	346,411	343,563	346,102
(a) The pro forma statements exclude the impact of the amortization of goodwill, deferred stock compensation, restructuring costs, minority investment write-downs and charitable contribution charges in all periods.

JUNIPER NETWORKS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts)
		Three Months Ended June 30,				Six Months Ended June 30,
		2001		2000		2001		2000
		(unaudited)				(unaudited)
Net revenues	$ 202,181		$ 113,028	$ 534,286		$ 176,914
Cost of revenues	80,480	40,752	194,221	65,853
Gross profit	121,701	72,276	340,065	111,061
Operating expenses:
Research and development	42,077	18,000	85,068	33,990
Sales and marketing	35,963	17,247	77,285	28,752
General and administrative	9,439	4,171	19,907	7,185
Goodwill and deferred stock compensation	31,117	2,315	67,700	4,706
Restructuring costs	12,340	-	12,340	-
Charitable contribution	-	10,000	-	10,000
Total operating expenses	130,936	51,733	262,300	84,633
Operating income/(loss)	(9,235)	20,543	77,765	26,428
Interest income, net	9,916	9,876	21,908	16,512
Losses realized on minority investments	(32,620)	-	(42,620)	-
Equity in joint venture	(1,085)	-	(1,085)	-
Income/(loss) before income taxes	(33,024)	30,419	55,968	42,940
Provision for income taxes	4,107	10,802	34,533	15,252
Net income/(loss)	$ (37,131)	$ 19,617	$ 21,435	$ 27,688
Basic net income/(loss) per share	$ (0.12)	$ 0.06	$ 0.07	$ 0.09
Shares used in computing basic net income/(loss) per share	318,196	301,879	316,883	298,712
Diluted net income/(loss) per share	$ (0.12)	$ 0.06	$ 0.06	$ 0.08
Shares used in computing diluted net income/(loss) per share	318,196	346,411	343,563	346,102