Juniper Networks Inc Fireside Chat Hosted By JPMorgan Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Let me then sort of move into the -- some of the customers that you have and probably start some of the questions that -- which we'll go a bit deeper here. You have the Service Provider business, and a lot of the questions we get from investors is about sort of the growth that you're seeing in the Service Provider business right now. If you dial back to 2018 and 2019, that was a tough sort of couple of years in terms of your growth with the service providers. How is the current landscape different? I mean, obviously, the question that comes out of this is, is there a structural growth here at Juniper that we've seen sort of the turnaround from 2018 and 2019? So maybe just sort of try and outline for us what are those growth opportunities. Is this a permanent improvement in the outlook for Juniper ratability Service Provider vertical?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : You've talked about the opportunity created to Service Provider in 400 gig as well as I think you've sort of said Metro and access is another area that you're incrementally focused on. Can you talk about the rate of size of these opportunities? Like how big is the 400-gig opportunity with the Service Provider? I know everyone wants to hear more 400-gig switching with cloud, but 400-gig with service providers and then the Metro and the access part. And particularly, how does the automation that you're bringing forward really sort of become a winning end here?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : So just to then go back on the year 1 Service Provider win that you mentioned. Is that something where investors should think of it as a 400-gig win? Or is it more about capacity expansion rather than the speed upgrade?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Let me just open it up here. Anyone with questions in the room? Okay. Let me continue then, Rami. One of the things that you mentioned is sort of the Metro opportunity. And increasingly, as we are talking about Metro from the networking perspective, from my standpoint, we are starting to see the convergence of a lot of optical players and sort of core networking players talking about the same opportunity. The question that I had for you on that front was, I mean, Cisco has also talked about this, basically the proliferation of IP routed networks, and how that could cannibalize DWDM in the future? We, on the other hand, also have companies like Ciena that are talking about the cannibalization on the other side of it, coming from the exact opposite direction. So how are you thinking about the architecture choices for the network in the future? And which one of that architecture sort of cannibalization is more likely to happen?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : I mean, given that sort of backdrop where you think there's a convergence that can happen, particularly a plug will sort of makes that a bit more seamless. How are you thinking about sort of Juniper's role and particularly your decision to create this new joint venture with Synopsys relative to the -- I think, the products that you were developing, you put that in the joint venture, right?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : I mean any guidance in terms of what we're looking for, in terms of timing of the first products? When do you -- like you have a stake, and I'm sure you have insights into how that development is progressing. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 16, 2022 / 5:00PM, JPM.N - Juniper Networks Inc Fireside Chat Hosted By JPMorgan

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : And just going back to the pluggables and the ZR and ZR+ strategy there now. You mentioned you've still co-developed with another -- and that's -- have you named a partner there?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Okay. In terms of the -- generally, what we are hearing a lot of questions around is given the vertical integration that could benefit a lot of companies, and Cisco has talked about this and obviously put their stake up in the ground with the Acacia acquisition. A lot of questions around, is it better to partner? Or is it better to own the asset itself? How are you thinking about that?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Let me check again if anyone in the audience has a question. Yes, please go ahead. Unidentified Participant So clearly, demand is very robust. You're still supply constrained this year. You're going to see double-digit percent growth. You provided us a

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Did you want to follow up? Unidentified Participant I'll just follow up on the backlog. I think on the call, you mentioned that you didn't expect it to grow through the remainder of the year. Just curious about the backlog dynamic through the remainder of the year, any further commentary on that? And whether or not -- if it's too uncertain to tell whether or not it will grow or fall from where you are at $2.4 billion now?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : I got a question that came in about your Security business. In Q2, it declined. And can you give us -- talk about that, maybe give us a little overview of your Security business.

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Rami, I wanted to follow up on the guidance or the sort of outlook for next year, since we are already on that topic. So you mentioned, next year, you're still expecting a supply-constrained environment, and that's part of the at least mid-single-digit growth guide. Does that -- I mean, one of the things we've had investors come to us frequently with is in demand in some of the other markets like consumers, et cetera, is softening. How much of that does help networking, and we know it doesn't help on the chip side as much because it's not like you can use some of those chips, but it does help on some of the more Jellybean components. So what are you sort of expecting on that front? We're also starting to hear that the broker market pricing, those are starting to moderate a bit finally. So what are you seeing on that front? And then I do want to follow up on the demand side a bit, more, but let's...

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : And yes, go ahead. Unidentified Participant Just on supply chain perhaps. You guys the word would be, you've been revenue constrained, but you've also done so much better than Cisco in the recent period. What do you attribute sort of their challenges to and sort of your relative outperformance there? Kind of what is about the design of supply chain or scale of it or...

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Rami, to go back to the follow-up on the demand side, the at least mid-single-digit guidance that you have outlooked -- you have for next year. So just the fuel you're putting for next year is with some amount of cautiousness around demand and the current macro we are in. And correct me if I'm wrong on that. And so if we were to say that the macro does sort of start to show signs of weakness that then flow through into the orders, is that floor something that still holds, based on your thinking about how much is realistic in terms of order moderation?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Maybe just a follow-up to the outlook question for 2023 and looking at some of the big end markets like cloud and service provider, mainly on the wireless side. I think there would be some concern that the cloud vendors would have some slowing in CapEx, just given the fundamentals of their businesses? And then, I guess, on the timing of these 5G rollouts, have we reached peak if you look at some of the CapEx commentary from at least the large North American vendors? I'm just curious, any color you could share just on what's going on in those end markets would be great.

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Rami, I do want to move to Enterprise, and we still have Enterprise and Cloud to cover. So I think the big question about the Enterprise business, obviously, you've -- that's been sort of a consistent theme across many earnings calls now in terms of the growth that you're seeing, and we keep watching the market share as well. Although when you look at this big sort of TAM in terms of the campus opportunity, was $16 billion TAM, you're still about sort of 3% share of that in terms of what we see from the industry data. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 16, 2022 / 5:00PM, JPM.N - Juniper Networks Inc Fireside Chat Hosted By JPMorgan So maybe just talk about how do you sort of envision the opportunity? What is realistic for Juniper in terms of share of that overall opportunity? And a big pushback from time to time will be that Cisco is the big player in this market. It's very tough to go compete against them. So what tools do you really have this time around, which in the past hasn't really come through? What do you have now that helps you get to that sort of higher market share and break out of this 2%, 3% range that you've been in for a while in campus?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Any thoughts on how does this industry or this campus part of the market, particularly, consolidate over time? Because how it's very different from certain other segments is outside of Cisco, the market remains very fragmented. Is there a need for sort of more inorganic consolidation? Or do you see the product portfolio now in place, you keep working on go-to-market, and organically, the consolidation can still take you where you want to be? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 16, 2022 / 5:00PM, JPM.N - Juniper Networks Inc Fireside Chat Hosted By JPMorgan

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Just to end out the Enterprise discussion then. How are you thinking about what all of the Enterprise opportunity allows you to do in terms of software revenue? And where are you in terms of making progress towards moving a lot of that software into subscription consumption models?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Any questions in the audience? Unidentified Participant The Juniper team has always had a hybrid sort of silicon deployment strategy, right? ASICs, where you see a lot of value add off the shelf? Like I just saw your guys' announcement alongside welcome Tomahawk 5 announcement today. And it feels like the rest of the industry is sort of coming to where you guys are, we're starting to see a lot more custom silicon development. As you think about your platform maybe more focus on software and services, do you still see the team focusing placing a high value-add on doing your own custom silicon development?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Rami, quickly to move to the Cloud. I don't want to sort of end the discussion without having gone there at all. Everyone is very focused on 400-gig switching wins with hyperscalers. And one of the things that gets underappreciated in this is the 400-gig WAN use cases that where you've been winning, you are the incumbents. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 16, 2022 / 5:00PM, JPM.N - Juniper Networks Inc Fireside Chat Hosted By JPMorgan So maybe talk about -- just quantify that opportunity, what that revenue opportunity is relative to 400-gig switching with the hyperscalers? And then, I mean, where are you with 400-gig switching with hyperscalers? And then we can hit the Cloud majors.

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Let me wrap it up here with sort of open-ended question for you, which is, what do you think investors are still missing about the Juniper story? What are the aspects you would highlight before we close out?

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Great. Thank you for coming to the conference. Thank you, everyone.