Cisco CEO John Chambers said in a conference call Tuesday that the networking equipment giant may have grabbed a 3 percent to 5 percent market share from Juniper in the high-end router market. Routers are devices used by service providers to send data over the Internet. In the past two years, Juniper had been gaining market share from Cisco, which controls about 60 percent of that market.
Kriens would not discuss the Cisco claims specifically, saying that his "focus is on customers, not competitors."
Analysts, however, said Cisco's market-share gains could be bad news for Juniper. "We actually believe, given what we heard on the call, that this share gain could be several points higher," said Morgan Stanley analyst Christopher Stix.
"We drive the business mostly by looking at our win ratio," Kriens said at the U.S. Bancorp Piper Jaffray conference here. That metric, which indicates the ratio of business Juniper brings home, has improved in part because Juniper "selects very carefully where we think we have the best chance to compete," he said.
During its last quarterly report, Juniper predicted flat sales in the third quarter with a slight rebound in the fourth. Executives at the time said the company's biggest problem was that its customers were struggling.
And some critics have complained that the entire networking industry is "overbuilt," and that the glut of capacity will hurt markets for some time to come.
Kriens said Wednesday that he thinks that although some aspects of the market are fully built, there is still plenty of room for companies like his to grow.
Despite an economic slowdown, Kriens said the expansion of Internet networks is akin to the expansion of the railroads in the 19th century. "It's a pretty good time to be in the (railroad) car business, and a good time to be building the infrastructure that allows seats to be sold."
Wall Street is expecting Juniper to report earnings per share of 9 cents for the third quarter, 10 cents for the fourth quarter and 52 cents for the fiscal year. For 2002, First Call consensus is for a profit of 62 cent per share.
Sales are expected to be $199.97 million in the third quarter, $208.64 million in the fourth quarter and $943.39 million for the fiscal year. First Call consensus for 2002 revenue is $1.129 billion.
Juniper shares closed at $23.47, down $2.43 or 9.38 percent. Cisco was down $1.28, or 6.66 percent, to $17.98.