Juniper to lay off more than 500 and close facilities

The company will also stop development on application delivery controller technology it licensed from Riverbed

Juniper Networks will lay off about 6 per cent of its workforce and back out of application delivery controllers as part of a restructuring intended to cut costs and focus the company on markets where it can grow fast.

The job cuts, from an employee base of more than 9400, will lead to $US35 million in severance and other costs in the current quarter, the company said in a regulatory filing on Tuesday.

The Sunnyvale, California, company will also consolidate its facilities, eliminating about 300,000 sqm of leased space, or about 12 per cent of its global square footage. That step will cost about $US70 million this year, it estimates.

Juniper announced a new plan for its business in late February under new CEO Shaygan Kheradpir, saying it intended to become more efficient and return more value to shareholders. Activist shareholders, including Elliott Management, had slammed the company's recent performance. In recent years Juniper has expanded beyond its roots in service-provider routing, going into enterprise switching, security and other businesses, but has failed in those ventures, Elliott said in January.

Juniper said in February it would consolidate its routing, switching, security and network management and control products into one portfolio, and continually review that portfolio to determine which products fit.

Tuesday's filing fleshed out some details of the new company plan, including one of the businesses Juniper will exit. The company said it will stop development of application delivery controller technology that it licensed in July 2012, a technology that notably has no revenue associated with it, according to Juniper's filing. It licensed that technology from Riverbed Technology for $US75 million to fill gaps in the Juniper product lineup. Ending development will lead to an asset impairment charge of US$85 million, the company said.

Juniper expects to take still more charges throughout the rest of this year for facilities consolidations, cuts in marketing programs and other asset restructuring.

Stephen Lawson covers mobile, storage and networking technologies for The IDG News Service. Follow Stephen on Twitter at @sdlawsonmedia. Stephen's e-mail address is stephen_lawson@idg.com

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Tags business issuesNetworkingjuniper networksrestructuringlayoffsSEC Filings

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Stephen Lawson

IDG News Service
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