Hewlett Packard Enterprise (HPE) on Wednesday closed the $14-billion all-cash acquisition of Juniper Networks, following receiving a key regulatory approval in the US, to pursue artificial intelligence (AI)-driven networking business opportunities, and compete strongly with domestic rival Cisco. <\/p>\n
\u2018The combination positions HPE to capture the growing AI and hybrid cloud market opportunity by creating an industry-leading cloud-native and AI-driven IT portfolio, including a full, modern networking stack,\u2019 HPE said in a statement. <\/p>\n
The Texas-headquartered server maker said that the \u201ctransaction doubles the size of HPE\u2019s networking business\u201d, adding that it also accelerates the company\u2019s portfolio mix shift to higher-margin, higher-growth areas and positions the company for \u201clong-term profitable revenue growth\u201d. <\/p>\n
\u2018Today begins a new era for HPE \u2013 we are now at the epicenter of the transformation of IT, where AI and networking are converging,\u2019 said Antonio Neri, president and CEO of HPE. <\/p>\n
In addition to positioning HPE to offer a modern network architecture and products across hybrid Cloud, AI and networking, the acquisition accelerates the company\u2019s \u201cprofitable growth strategy\u201d and expands its total addressable market into adjacent areas, including data center, firewalls, and routers, Neri added. <\/p>\n
\u2018HPE and Juniper have a unique opportunity to disrupt the networking industry at the most important and relevant time,\u2019 said Rami Rahim, former CEO of Juniper Networks, who will now lead the combined HPE Networking business as its president and general manager (GM).<\/p>\n
‘I am a technologist at heart and when I look at the opportunity here to combine technologies and teams to compete, not just with Cisco, but with this very vibrant, very competitive landscape, it’s incredibly exhilarating to me,’ Rahim said during a press conference, SDxCentral reported. <\/p>\n
The acquisition of Juniper\u2019s high-margin business is expected to be accretive in the near- and long-term for the combined company. The transaction will be accretive to non-GAAP EPS in the first post-close, with the combined networking business contributing more than 50% of total company operating income, according to the statement. <\/p>\n
The US Justice Department recently settled its lawsuit challenging HPE\u2019s acquisition of Juniper. The settlement requires the combined company to divest HPE\u2019s Instant On wireless networking business and license the source code for Juniper’s Mist AI software used in Juniper’s wireless local network (WLAN) products.<\/p>\n
‘Rami Rahim\u2019s top priorities will include rationalizing road maps, obtaining the promised $450 million in G&A (General and Administrative expense) savings, and incentivizing the sales teams and channel to toe the line,’ Si\u00e2n Morgan, a research director at Dell’Oro Group, said in a recent blog. <\/p>\n
Additionally, challenging Cisco will require extensive work. The research agency estimates that Cisco has over a third of all enterprise market revenues, while HPE and Juniper combined make up 8%. ‘The plan to become number one will be a long-term project and will involve fighting IT inertia with a powerful product offering exuding simplicity and providing a lower-cost option to Cisco customers,’ Morgan said. <\/p>\n
HPE\u2019s established extensive channel and installed base, merged with Juniper\u2019s Mist AIOps engine, could be the combination that may give Cisco a run for its money, she said, adding that market digestion and a shift in AI spending may be “mere bumps in the road”. <\/p>\n
HPE had announced the acquisition more than a year ago, saying it would enhance its AI offerings.<\/p>\n
The acquisition was approved by Juniper shareholders on April 2, 2024. With the completion of the transaction, shares of Juniper\u2019s common stock, which traded on the NYSE under the symbol \u201cJNPR,\u201d have ceased trading and will no longer be listed on the stock exchange. <\/p>\n
Datadog Inc separately said it will replace Juniper Networks in the S&P 500 effective prior to the opening of trading on Wednesday, July 9. <\/p>\n
For the quarter ended April 30, HPE posted revenue of $7.63 billion. It has forecasted a third-quarter revenue between $8.2 billion and $8.5 billion.<\/p>\n","protected":false},"excerpt":{"rendered":"
Hewlett Packard Enterprise (HPE) on Wednesday closed the $14-billion all-cash acquisition of Juniper Networks, following receiving a key regulatory approval in the US, to pursue artificial intelligence (AI)-driven networking business opportunities, and compete strongly with domestic rival Cisco. \u2018The combination positions HPE to capture the growing AI and hybrid cloud market opportunity by creating an industry-leading cloud-native and AI-driven IT portfolio, including a full, modern networking stack,\u2019 HPE said in a statement. The Texas-headquartered server maker said that the \u201ctransaction doubles the size of HPE\u2019s networking business\u201d, adding that it also accelerates the company\u2019s portfolio mix shift to higher-margin, higher-growth […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7],"tags":[],"class_list":["post-943521","post","type-post","status-publish","format-standard","hentry","category-it-2"],"acf":[],"_links":{"self":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/posts\/943521","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/comments?post=943521"}],"version-history":[{"count":0,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/posts\/943521\/revisions"}],"wp:attachment":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/media?parent=943521"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/categories?post=943521"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/tags?post=943521"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}