Juniper Research: Electric Vehicle Battery Pack Shipments to Reach 30 Million in 2027, as Mobility Electrification Gains Speed
190% Growth in Global Shipments Reflects Rapidly Transforming Mobility Market
A new Juniper Research study has found the volume of electric vehicle battery pack shipments will reach 30 million in 2027; from just 10 million in 2022. The research identified falling vehicle costs, often directly caused by government subsidies, and increasing awareness around the environmental impact of current mobility services as key drivers behind the growth in electric vehicle battery production.
Commercial Vehicles to Experience Greatest Growth
The research predicts that growth will be strongest within the commercial segment, with commercial electric vehicle battery pack shipments growing from 1.4 million in 2022 to over 7 million by 2027. Mass electrification of fleet vehicles is required for meeting corporate decarbonisation goals and will drive investment into electric vehicles from enterprises. In turn, this provides an opportunity for manufacturers to develop batteries designed for energy-intensive commercial use cases.
Research co-author Damla Sat explained: “Developing longer range vehicles by leveraging higher capacity battery packs will be critical to meeting expectations that foster commercial vehicle electrification, but will require extensive investment to develop new battery pack technologies.”
New Technologies Key to Unlocking Electric Vehicle Potential
The research predicts that for electric vehicles to reach mass adoption across commercial use cases, including heavy goods haulage and passenger transport, scaling production of new battery technologies is essential. This includes solid state batteries and new chemical mixes.
The most pressing issue for electric vehicle adoption is the rare earth minerals required in battery production, including cobalt, which is difficult to source, in terms of both cost and the ethics around procurement. Accordingly, the research recommends that manufacturers rapidly move to new, higher capacity technologies including solid state batteries to unlock energy intensive use cases. The report however cautioned that changes in technologies must continue to prioritise the sustainability goals electrification is based upon.
EV Batteries market research: https://www.juniperresearch.com/electric-vehicle-batteries-market-research-report
Download the whitepaper: https://www.juniperresearch.com/whitepapers/ev-batteries-driving-towards-green-future
Juniper Research provides research and analytical services to the global hi-tech communications sector; providing consultancy, analyst reports, and industry commentary.
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Juniper Networks Announces Mist Microservices Advantage Tech Talk Dial-in Numbers
Juniper Networks (NYSE: JNPR), a leader in secure, AI-driven networks, today announced the dial-in numbers for the upcoming investor event:
Please dial in ten minutes prior to the scheduled conference call time.
This event will be available live via webcast on the Juniper Networks website: http://investor.juniper.net/.
About Juniper Networks
Juniper Networks challenges the inherent complexity that comes with networking and security in the multicloud era. We do this with products, solutions and services that transform the way people connect, work and live. We simplify the process of transitioning to a secure and automated multicloud environment to enable secure, AI-driven networks that connect the world. Additional information can be found at Juniper Networks (www.juniper.net) or connect with Juniper on Twitter, LinkedIn or Facebook.
Juniper Networks, the Juniper Networks logo, Juniper, and Junos, and other trademarks listed here are registered trademarks of Juniper Networks, Inc. and/or its affiliates in the United States and other countries. Other names may be trademarks of their respective owners.
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+ 1 (408) 936-5767
View source version on businesswire.com: https://www.businesswire.com/news/home/20220729005113/en/
Photo: CHBA CI
TRU carpentry students with instructor Tim Kasten, Project Manager Ron Wrabel, CHBA CI's Jere Lorenz and Tom Calne in front of the 2023 Training House project site and sponsorship board in Juniper West on August 4, 2022.
Thompson Rivers University trades students have started construction on next year’s Y Dream Home.
The 2023 Training House Project, a partnership between TRU’s School of Trades and Technology and the Canadian Home Builder’s Association Central Interior, kicked off on Thursday in Juniper West.
Tim Kastan, a TRU instructor, said the project — now in it’s 33rd year — helps give trades students hands-on experience.
First-year residential construction students complete the house foundation and framing, and the home is finished by CHBA CI members.
“For us, it is about enhancing the educational experience of our trades students by giving them on-site experience in addition to classroom work,” Kasten said.
According to the home builders’ association, the finished home has been sold to the Kamloops YMCA/YWCA for their Dream Home lottery fundraiser for the past 26 years, with proceeds going to support community programming.
Last year's home was constructed in Tobiano.
Tom Calne, CHBA CI’s incoming president, said the build is beneficial to the association.
“This project allows us to be part of the community and also showcase[s] the incredible talents in our local homebuilding industry," Calne said.
This year’s house is being built at 2197 Coldwater Dr. The house style is described by CHBA CI as “refreshingly modern,” a design from Grant Bergman of Bergman Home Design Inc.
Ron Wrabel of WrabelGen Ventures Ltd. will serve as project manager for the build, with other CHBA CI members providing products and labour.
According to a statement from CHBA CI, the new home will feature the latest innovative product and designs for those thinking of building or renovating a home.
The association says it will feature the building steps on its social media platforms, providing followers with a glimpse into the construction process.
Don’t let the head full of snakes distract you. Do not be cowed by the presence of Greek gods and goddesses or lulled by the vaguely familiar details of a story you only think you know.
Yes, Medusa was a mythological monster whose hair was a nest of snakes. Yes, anyone who looked upon her face would turn to stone. And yes, even after she was decapitated by Perseus, Medusa still had the power to paralyze.
But in her new poetry collection, “The Loneliest Girl,” the Los Angeles-based writer and publisher Kate Gale looks at Medusa and sees the woman behind the terrifying creature. The woman who was raped by the sea god Poseidon in Athena’s temple, and then Athena made her pay the price.
Medusa didn’t become a monster because of anything she did, but because of something that was done to her. That is the part of Medusa’s story that gets lost amidst the snakes, the beheading, and the way Perseus used her head as a weapon and triumphed on the battlefield.
For Gale, that neglected narrative is where the tragedy is. Also, the truth.
“I think the erasure of women’s voices has gone on for centuries. If you want to tell a story of something that has happened to you, you don’t feel like you are completely heard,” said Gale, who will be memorizing from “The Loneliest Girl” at the Book Catapult bookstore in South Park on Aug. 10.
“The fact that she is alone. The fact that she feels like there is nobody in her corner. The fact that she has to be ashamed of what she’s done, and what she’s done is she has been assaulted. All of that is familiar to us, even now.”
In “The Loneliest Girl,” which is Gale’s seventh book of poetry, Medusa’s story does not begin with Poseidon or end with Perseus. She is not cursed by a vengeful goddess or demoted to a supporting role in some hero’s war story. But she is no stranger to the front lines.
The collection opens with “There are ten things you need to know to be a woman,” a guide to the battlefield that is womanhood. Each item takes on a different enemy — leering boys, perilous college parties, jealous co-workers, judgmental religions — but all of them include the same warning:
They come for you.
The final poem is “Stumbling toward Grace,” in which the narrator asks herself a series of pointed questions — Are you thinking of killing yourself? So, are you going to live? — before landing on the question that sets her free.
What would you like to do?
The poem ends with the answer, which is humble, hopeful and defiantly human.
I have my life to work on this single thread. There is unrestrained stupidity and there is grace. In my dreams, I stumble toward grace.
“What I hope for is that people would come away from this with the idea that once you transform the narrative that you’re inside of, that’s everything,” Gale said. “You get to transform the narrative. I really believe that.”
Gale transformed her own narrative in a major way at an early age. In 1981,she fled the New Hampshire religious cult where she was raised for an outside world that she knew almost nothing about. She was 18 years old, and she had no money, no driver’s license and and no idea about where she was going to go next.
She eventually made her way to Virginia, where she met a guy who helped her figure out that next move. Not on purpose, but sometimes the creative gods move in mysterious ways.
“I was dating this guy who was also very religious, and he told me that God said I was not to go to college. It never occurred to me to go to college, but I immediately decided, ‘That’s it. I’m going to college.’”
A stint at a community college in Virginia led to Arizona State University, where Gale caught the attention of acclaimed poet Rita Dove, who convinced her to major in English. Gale went on to get her doctorate in English from the Claremont Graduate University.
In 1994, she co-founded the Pasadena-based nonprofit Red Hen Press, which publishes poetry, fiction and creative nonfiction; organizes readings and other literary events; and presents 10 literary awards to emerging writers every year.
Gale says that “The Loneliest Girl” is the most difficult book she has ever written. But now that she has given Medusa a voice, she has discovered how much power there is in sharing it with the people who need to hear it. Including the author herself.
“When I read it (in public) for the first time at the (Red Hen) press, it felt like I had started to let go of the darkness. What I have experienced in readings is people feeling a solidarity with me. And that feels strengthening, in a way. It feels like I have come up for air.”
Kate Gale and novelist Carlos Allende (“Coffee, Shopping, Murder, Love”) will discuss and sign their latest books at 7 p.m. Aug. 10 at the Book Catapult bookstore, 3010-B Juniper St., South Park. (619) 795-3780. Go to thebookcatapult.com for information.
Juniper Networks Inc. (NYSE:JNPR) Q2 2022 Earnings Conference Call July 26, 2022 5:00 PM ET
Jess Lubert – Vice President of Investor Relations
Rami Rahim – Chief Executive Officer
Ken Miller – Chief Financial Officer
Conference Call Participants
Paul Silverstein – Cowen
Tim Long – Barclays
Amit Daryanani – Evercore
Rod Hall – Goldman Sachs
Alex Henderson – Needham
George Notter – Jefferies
David Vod – UBS
Simon Leopold – Raymond James
Angela Jin – JPMorgan
Aaron Rakers – Wells Fargo
Meta Marshall – Morgan Stanley
Sami Badri – Juniper
Tal Liani – Bank of America
Good afternoon, ladies and gentlemen, and welcome to the Juniper Networks' Second Quarter 2022 Financial Results Conference Call. At this time all participants have been placed on a listen-only mode and we will open the floor for your questions and comments after the presentation.
It is now my pleasure to turn the floor over to your host, Jess Lubert, Vice President of Investor Relations. The floor is yours.
Thank you, operator. Good afternoon and welcome to our second quarter 2022 conference call. Joining me today are Rami Rahim, Chief Executive Officer; and Ken Miller, Chief Financial Officer. Today's call contains certain forward-looking statements based on our current expectations. These statements are subject to risks and uncertainties and genuine results might differ materially. These risks are discussed in our most recent 10-Q, the press release, and CFO commentary furnished with our 8-K filed today and in our other SEC filings. Our forward-looking statements speak only as of today and Juniper undertakes no obligation to update any forward-looking statements.
Our discussion today will include non-GAAP financial results. Reconciliation information can be found on the Investor Relations section of our website under Financial Reports. Commentary on why we consider non-GAAP information a useful view of the company's financial results is included in today's press release. Following our prepared remarks, we will take questions. We ask that you please limit yourself to one question, so that as many people as possible who would like to ask a question have a chance.
With that, I will now hand the call over to Rami.
Good afternoon everyone and thank you for joining us on today's call to discuss our Q2 2022 results. We delivered strong top line results during the June quarter as total revenue of $1.270 billion exceeded the mid-point of our guidance and product revenue saw a second consecutive quarter of double-digit year-over-year growth despite ongoing challenges from a supply chain perspective. Demand remained strong and exceeded our expectations with product orders seeing double-digit year-over-year growth when adjusted to account for extended lead times. While gross orders experienced a single digit year-over-year decline, this was better than expected given the difficult comp in Q2 of last year, when the duration of customer orders began to extend.
Total product backlog increased meaningfully on both a sequential and a year-over-year basis to end at a record level, setting us up well for future revenue growth as this backlog eventually begins to normalize. Our focus on delivering solutions that Improve customer operations what we call experience-first networking continues to resonate across each of the markets we serve. This is evident in our Q2 results, which saw year-over-year revenue growth across all customer verticals.
Demand signals remain healthy and we are seeing attractive opportunities across our Enterprise Cloud and Service Provider markets. With that said, we are particularly encouraged by the Q2 momentum in our enterprise business, which not only delivered a record revenue quarter, but also saw orders increased by 20% year-over-year. We believe this strength is reflective of our sustainable differentiation and technology and user experience, both in our campus and our data center offerings, as well as the investments we've made in our go-to-market organization.
We believe these factors should enable us to gain share and deliver sustainable enterprise growth in future periods even if macro headwinds start to affect our markets. Another highlight in the quarter was the increased diversification within our Cloud vertical, where we saw improved momentum with multiple hyperscale providers and continued success with Cloud major accounts, both of which are adopting our 400 gig technology. Of our top 10 customers in the June quarter, six of them were Cloud accounts, which illustrates the diversification we are seeing. We view our increased Cloud diversification as a positive development, which should position this business for sustainable long-term growth.
Not to be overlooked, we continue to see healthy momentum in the service provider vertical and just recently secured a new 400 gig core win with one of the Tier 1 U.S. carriers. We're also making progress in the Metro market where we recently introduced several new platforms that will further enhance our competitive position in this attractive portion of the market. Our teams are executing well and we continue to feel good about our ability to capitalize on big opportunities tied to enterprise digital transformation and clarification initiatives, 400 gig upgrades at Cloud and Service provider customers and the broader adoption of Cloud-based services and network architectures. Based on my conversations with customers, these opportunities represent key strategic initiatives that should present a durable tailwind for our business over the next several years. While revenue was a bright spot and customer demand remained strong, margin and EPS came in weaker than we expected due to higher than expected supply chain costs and lower than expected perpetual software revenue, both of which I'd like to address.
First, from a supply chain perspective, the availability of remained extremely challenged during the June quarter, as we saw a meaningful uptick in the volume of provider decommits. In order to secure access to additional parts and get products to customers as soon as possible, we incurred higher costs than we anticipated at the beginning of the quarter. While some of these actions will impact profitability over the next few quarters, they are also enabling us to access more parts and better satisfy customer demand, which should have positive, longer term implications for our business.
Secondly, our software revenue mix came in lower than we expected, even though software revenue still grew 24% year-over-year. We believe the outlook for our software business remains strong and we are encouraged by the momentum we're seeing with our Junos Space Flex software, out-of-the-box subscription software and software-as-a-service offering, such as Mist. Much of this momentum can be seen in our deferred revenue from customer solutions, which grew 7% sequentially and 41% year-over-year. The truly ratable component of this deferred revenue, which accounts for more than half of the total, grew even faster, nearly doubling on a year-over-year basis.
In summary, demand remains strong and given the backlog we've built, along with the actions we've taken to secure more supply, we're now incrementally more confident regarding our top line outlook and our ability to ship products to customers. As a result, we now expect to deliver approximately 10% sales growth in 2022 and at least mid-single digit revenue growth in 2023.
While non-GAAP operating margin is likely to be flat to slightly down in 2022 due entirely to the lower than anticipated non-GAAP gross margin we now expect, we still expect non-GAAP earnings to grow. We remain focused on delivering improved profitability and expect margin to expand in 2023.
Now I'd like to provide some additional insights into the quarter and address some of the key developments we're seeing from a customer solutions perspective. Starting with Automated WAN, we delivered strong results in the Q2 timeframe and orders once again, exceeded expectations, but did decline year-over-year. Revenue grew year-over-year across all customer verticals, all geographies and all major product lines, including our MX, PTX and ACX families.
We are continuing to see strong 400-gig momentum with our cloud and service provider customers, including the new 400-gig core win with the U.S. Tier 1 provider that I previously referenced. This win was secured based on the strength of our PTX product family, which delivered the superior scale, embedded security and power efficiency this important customer requires.
I was also encouraged to see another quarter of strong demand for our newer MX platform leveraging our 306 silicon, including the MX10K, the LC 9600 line card and the MX304. These platforms deliver the industry-leading logical scale, embedded security and power efficiency necessary to meet the needs of the most demanding multiservice edge environment.
We also saw another quarter of triple-digit order growth for our ACX Metro portfolio and introduce several new platforms such as the ACX7024 and the ACX7509, both of which provide industry-leading performance and expand the number of Metro use cases we can address. We plan to further enhance our Metro portfolio with new hardware, software, and automation capabilities in future quarters that will further enhance our competitive position in this attractive portion of the service provider market.
Our cloud-ready data center revenue was flat Q2 due entirely to the timing of shipments. Orders exceeded expectations, but did decline year-over-year due to an exceptionally large deal with a hyperscale account in the year ago quarter. Excluding this customer, orders experienced double digit year-over-year growth, and we continue to see healthy momentum with large enterprise and Cloud major accounts. Our 400-gig solutions are resonating in the market, and we have now secured approximately 80 400-gig data center switching opportunities that span across cloud majors, enterprise and service provider accounts.
Customer interest in our cloud-ready data center portfolio remains high and given the wins we've already secured, I am optimistic about our ability to capitalize on the attractive growth within this market over the next several years. Our AI-driven enterprise revenue continued to materially outpace the market, growing 17% year-over-year. This strength was led by our Mist-ified portfolio, which grew more than 60% year-over-year, achieving another record quarter for both Mist Wi-Fi and Mist-ified revenue.
We are especially encouraged by the traction we're seeing with large customers across the globe with wins at a global financial bank, a global car manufacturer, and a global furniture retailer, each of which recently purchased a combination of AI-driven wireless, wired, security and/or SD WAN products from Juniper.
To build on this AI-driven enterprise momentum we continue to deliver groundbreaking new products that optimize both end user and operator experiences such as a recently launched EX4100 family of access switches. Like the EX4400 family announced last year, these are truly enterprise grade access switches born in the cloud with native AIOps ensuring easy setup and management coupled with best-in-class scalability, security and performance.
In addition, we brought AIOps to indoor location services with recently announced features that simplify wireless access point placement and orientation and we are now delivering six generation AI driven actions to address even more common networking problems, such as DHCP failures and wired authentication errors. Based on our recent order momentum, third-party validation and the technical superiority of our AI driven enterprise portfolio, I remain highly confident regarding the outlook of our complete client-to-cloud campus and branch business.
Our security revenue declined in Q2 due largely to supply chain constraints on our hardware platforms and a difficult comp in the year ago quarter. Despite these challenges, we saw healthy momentum in our mid-range firewall portfolio, as well as our software-only security offerings. We believe the performance of our products is industry leading, which has been validated by a number of independent tests. Most recently receiving a AAA rating from cyber ratings with a 100% block rate for our cloud firewall offerings.
We remain confident in our connected security strategy and believe the convergence of networking and security provides us with a competitive advantage in the portions of the market where we are currently focused. We believe our technical strength in both security and networking will provide tailwinds in future quarters and should enable us to deliver better results over the next few quarters. I'd like to mention that our services team delivered a record quarter due to strong renewals and attach rates.
In addition to strong revenue, we also achieved another quarter of solid service margin. Our services organization continues to execute extremely well and is focused on driving incremental efficiencies through automation and cloud delivered insights that not only create new revenue opportunities, but also benefit margin and the customer experience. I would like to extend my thanks to our customers, partners and shareholders for their continued support and confidence in Juniper. I especially want to thank our employees for their hard work and dedication, which is essential to creating value for our stakeholders.
I will now turn the call over to Ken who will discuss our quarterly financial results in more detail.
Thank you, Rami, and good afternoon, everyone. I will start by discussing our second quarter results and end with some color on our outlook. We ended the second quarter of 2022 at $1.270 billion in revenue above the midpoint of our guidance and up 8% year-over-year. Non-GAAP earnings per share was $0.42 below the midpoint of our guidance range due entirely to lower than expected gross margin. We continue to be in a supply constrained environment with unprecedented costs to procure components and deliver our products.
We prioritize delivering products to our customers as timely as possible, which resulted in higher costs and lower gross margin. Product orders remained strong during the second quarter and exceeded our expectations. As a reminder, we are experiencing some order strength attributable to industry’s supply chain challenges resulting in customers placing orders ahead of their normal order rate to account for the extended lead time. While product orders declined single-digits year-over-year due to a difficult comparison. Adjusted orders grew double-digits year-over-year, and our backlog increased more than $250 million on a sequential basis.
We saw particularly strong demand and enterprise vertical with both gross and adjusted orders growing on a year-over-year basis. From a customer solution perspective, Automated WAN Solutions and AI driven enterprise revenue both grew 17% year-over-year. Cloud-Ready Data Center revenue was essentially flat year-over-year. Looking at our revenue by vertical, all verticals grew sequentially and on a year-over-year basis.
Revenue in Enterprise grew 15%, followed by service provider growing 6%. And our cloud business grew 3% on a year-over-year basis. Total Software and Related Services revenue was $213 million, which was an increase of 24% year-over-year. Annual recurring revenue or ARR who approximately 34% year-over-year and reviewing our top 10 customers for the quarter, six were cloud, three were service provider, and one was an enterprise.
Our top 10 customers accounted for 34% of total revenue as compared to 33% in Q2 2021. Non-GAAP gross margin was 56.2%, which was below our guidance range primarily due to elevated supply costs related to the challenging supply chain environment and lower than anticipated software mix. We experienced a greater volume of supply de-commitments in the quarter, which resulted in increased expedite and component costs as we prioritized delivering products to our customers as timely as possible. If not for the elevated supply chain costs, we estimate that we would’ve posted non-GAAP gross margin of approximately 59%. We expect the supply chain environment to remain challenged through at least the second half of the year.
Moving on to operating expense, on a non-GAAP basis, which increased 4% year-over-year, and 1% sequentially. Non-GAAP operating margin was 13.9% for the quarter, which was below our expectations due to the lower than expected gross margin result. We had $267 million in cash outflow in the quarter. The cash outflow in the quarter includes approximately $165 million of additional payments to suppliers and prepaid deposits as well as strategic inventory purchases and an attempt to meet our customer delivery demands. Approximately $115 million of lower customer collections related to invoicing linearity and approximately $75 million of additional cash tax payments related to the capitalization and amortization requirements for research and development expenditures of the Tax Cut and Jobs Act of 2017, which went into effect on January 1, 2022.
While we expect to be cash flow positive in the second half of 2022, some of these items are likely to also negatively impact second half cash flow results. Over time, we do expect cash flow timing differences to normalize and our cash flow results should be relatively in line with profit levels. Total cash, cash equivalents and investments at the end of the second quarter of 2022 was $1.3 billion.
Now, I’d like to provide some color on our guidance, which you can find detailed in the CFO commentary available on our Investor Relations website. For the third quarter, we expect to see revenue growth of approximately 14% year-over-year driven by the strength of our backlog, strong demand and an improved supply outlook.
Our better than expected supply outlook is the result of strategic actions we have taken to Improve our access to components. We will continue to prioritize delivering products to our customers as timely as possible. The higher costs we are incurring to secure supply will negatively impact margins over the next several quarters.
In addition, we expect to see a similar software mix in the third quarter as we saw in the second quarter. These factors will continue to pressure our gross margin and overall profitability.
Turning to our expectations for the full year 2022. Given the strong order momentum we have seen coupled with our current backlog, as well as an improved supply outlook, we are raising our revenue growth expectation for the year to approximately 10%. This assumes the current supply chain environment does not further deteriorate.
We also anticipate backlog to remain at elevated levels through the remainder of the year. Non-GAAP gross margin for the full year 2022 is expected to be approximately 57% down from our original expectations of 58% to 60%. As a result of the supply chain constrained environment, we now expect to absorb approximately $155 million of elevated component and freight costs in 2022, more than 50% higher than we had anticipated at the beginning of the year. We believe these elevated costs will be transitory over time.
In addition, software as a percentage of total revenue in the second half of the year is expected to remain close to Q2 2022 levels. In 2021, we implemented some pricing actions, which have begun to parse the offset some, but not all the increased costs we are incurring. We are planning to take additional pricing actions to further offset these incremental costs.
However, given the size of our backlog, these actions will take time to positively impact our results. We remain committed to disciplined expense management, and we expect operating expense to grow slower than revenue. That said, we will continue to invest to take advantage of market opportunities and our non-GAAP operating expense is expected to increase on a full year basis.
Given the pressure we are seeing in non-GAAP gross margin, we no longer have line of sight to at least a 100 basis points expansion of non-GAAP operating margin. Our current expectation is non-GAAP operating margin will be flat to slightly down for the full year. We still expect non-GAAP EPS to grow on a full year basis.
While the current global macroeconomic environment and the ongoing pandemic posed some uncertainty. We would like to provide some early color on our outlook for 2023. What the order momentum we are seeing our elevated backlog and current expectations for supply, we expect revenue growth of at least mid-single digits on a full year basis in 2023.
We also expect improved profitability and margin expansion in 2023. In closing, I would like to thank our team for their continued dedication and commitment to Juniper success, especially in this challenging environment.
Now, I’d like to open the call for questions.
Thank you, ladies and gentlemen. The floor is now open for questions. [Operator Instructions] First question is coming from Paul Silverstein with Cowen. Your line is live.
Thanks. I hate to ask you about supply chain, but I guess I will. Ken and Rami, what changed and I – at the risk of asking you to speak for not just yourselves, but other companies. There appears over the last year or two have been somewhat of a randomness in terms of a general trend of either stability or in some case modest improvement, but one or a handful of companies being impacted. We just heard [indiscernible] this morning, where stability. And I'm not throwing stones. I get it that it's a challenged environment out there, but what's accounting for the difference. And what changed in terms of the decommits for you?
Yes. So the supply chain environment remains very challenged as it has been for the last several quarters. Lead times from suppliers and to us are extremely extended. Sourcing supply is proving to be very difficult. And at times is coming at an increased cost. We did mention on the prepared remarks that in Q2 in particular, we did see a higher volume of decommits from suppliers. And this really forced us to pay more expedite fees and heavily leverage the broker markets more than we historically have. And that comes at a higher cost.
So the good news for us is, I feel very proud of our abilities to navigate these curve balls and these situations. And we actually – as you saw, we actually beat our revenue midpoint for the quarter. And based on these actions we're taking, albeit, they do come at a cost. We feel confident that we are getting access to more supply. And we actually raised our guidance for the full year.
So we do see supply getting improving from an absolute volume perspective, but it is coming at an incremental cost and it's difficult. I mean, every quarter seems to be a different challenge, but we seem to be doing a pretty good job in my opinion, navigating those challenges.
Key, can you give us a rough idea of how many decommits you're talking about and how that compared to the previous quarter?
Yes. It's difficult to quantify. I'll tell you that we had some large strategic suppliers that we were expecting supply early in the quarter than we received. We received some of it later in the quarter. The other impact we had was linearity in the quarter from a shipping perspective and invoicing perspective was also negatively impacted. So it was definitely greater than normal, Paul, but we haven't really given these numbers in the past, so it's hard to compare to historical norms.
All right. Can I ask one follow-up on – Rami, I think I heard your reference momentum or progress with hyperscalers. Can you give us any insight – more granular insight on what you're referring to?
I'd be happy to Paul. So I'm actually really pleased with our results with our cloud providers all up. I think the name of the game for us in the cloud provider space is diversification. I think we're seeing increased diversification among the hyperscalers to Tier 1 hyperscaler. So if one of our top hyperscale accounts goes through period of digesting orders that they've placed in the past or finding is another one will step in and compensate for that with more orders.
And that happened – some of that happened in Q2 and then brought more broadly, our cloud majors customers saw great momentum and not just in routing, but also in data center switching and in 400 gig opportunities. So all up, I'm very pleased with the momentum we're seeing and I'm optimistic about the cloud provider vertical going forward.
Up next we have Tim Long with Barclays. Tim, your line is live.
Thank you. Just wanted to talk on the enterprise business a little bit. So Rami, just if you could talk a little bit, obviously it's been a great market, good results this quarter. Talk a little bit about kind of the sustainability of the elevated growth there and a little bit on how you're continuing to invest and go to market and how you're pulling through whether it's traditional wired products or some of the SD-WAN or other new technologies that you're bringing into the enterprise. Thank you.
Yes, I'd be happy to. So needless to say, I'm incredibly proud of the team for the results that they're continuing to deliver in the enterprise segment all up, very strong growth, both in terms of revenue, but also in terms of orders that grew 20% year-over-year, diversity in terms of the technology offering. So obviously we're seeing continued momentum with our AI driven enterprise solutions, but even our automated WAN saw a really great momentum this quarter.
And a lot of that was driven by a resumption in spend by the federal government, which was kind of weak for the last several quarters. And I do expect that some of that is going to continue. So I'm actually quite optimistic about that. We are absolutely keeping a close eye on any sort of early warning indicators from a macro standpoint, any sort of headwinds, but so far, and you can see it from the order momentum we're seeing, we're not seeing any of that at this point in time.
And I think the team has done a really nice job of just focusing on more macro resistant segments of the enterprise market. I think that's working in our favor. I also believe that the kinds of technologies that we're offering to our customers be it cloud delivered AI driven solutions, highly automated data center solutions are the kinds of solutions that I think our customers or prospects view as very strategic to their digital transformation initiatives.
And so – and of that, I think you're going to see just more resilience to any sort of issues that might come our way in the future. So for all those reasons, technology differentiation, our go-to-market team, just crushing it focusing on the right sub-segments of the market, I continue to be very bullish about our enterprise business going forward.
Okay. Thank you.
Okay. The next question is coming from Amit Daryanani from Evercore. Your line is live.
Thanks for taking my question. I guess, one of the things that some of the companies I’ve talked about, I’d love to get your perspective is signs that macros and impact demand. Are you seeing any of that? I know the European revenues were a little bit weaker. But I’d love to just understand if you’re seeing anything in terms of elongation of sales cycles or anything on the macro side. And then just related to that I’m curious, what gives you the confidence and the conviction to give at least an initial framework for calendar 2023 this earlier in the process?
Yes. Amit, let me start and I’m sure Ken would like to weigh in as well. So order strength remains robust and it remains robust across all of our segments. So I know when it comes to macro indicators, I think people are mostly concerned about what might happen to the enterprise, but you saw there, enterprise revenue double digit growth, enterprise orders growing at 20% year-over-year. We’re not going to be immune to any sort of major macro changes that happen. But we’ve got our early warning indicators sort of – we’re sort of scoping and making sure that there isn’t anything to be concerned about. And thus far I’d say there is not. I think we are playing in markets that are large, that where we have relatively small share where there’s tons of opportunity for us to compete.
And we’re competing with solutions that I think are very strategic, especially in a situation where there are going to be cost pressures and the need for IT teams to start cutting costs. So for these reasons, I actually think even in the event that there were challenges – macro related challenges we can do quite well. And with that said, I’ll just pass it on to Ken for additional commentary.
Yes. On the FY2023 kind of framework, over the last several quarters, as you know, we’ve built up an exceptional backlog. This is definitely providing us much greater long-term visibility than we historically had. Our backlog is now more than $2.4 billion, which is approximately 6x normal levels, so an exceptional backlog build. Also the investments we’re making in the supply chain we believe are starting to pay off.
We did raise the full year this year, the second half we raised to get to a 10% full year guide in 2022. And we believe we’ll have access to supply to get to at least mid single digits next year. We haven’t provided FY2023 guidance as of yet. The only guidance you kind of have would be our long-term model, which was at least low single digits, which we provided over a year and a half ago. And we felt at this point, given the demand signals we’re seeing, given the supply that we believe will be able to procure, we think mid single digits is the right framework at this time, at least mid single digits.
Perfect. Thank you very much.
Okay. The next question is coming from Rod Hall with Goldman Sachs. Rod, your line is live.
Yes. Hi guys, thanks for the question. I had two for you. One is just the implied gross margin in Q4. We calculate about 1.3 percentage points, maybe 1.5 percentage points increase sequentially there off of Q3. And I’m just curious what you guys – what makes you expect that? Is it visibility on cost or is it pricing or kind of what the driver is there? And then I have one follow up.
Yes. So without getting specific on Q4, I’m sure your models are pretty accurate Rod. We do think the year would be about 57%. Really we expect there to be a volume benefit in Q4. We also expect to see more and more of the pricing actions that we’ve taken play out as time passes. So those would be the primary factors. Again, I’m not providing specific Q4 guidance. I don’t have exact mix prediction at this point. But I do believe 57% for the year is the right place to be right now.
Yes. Just if we plug in Ken, the Q3 guide that’s kind of what we get – what spits out of Q4.
Yes. And I’m sure your models are close. Yes. I just don’t have the model in front of me.
Yes. And then the other thing I wanted to ask you is DSOs are up a lot in the quarter, and I wondered if you could comment on linearity in the quarter and also, the driver for the DSOs is just supply shortage or was there’s some backend linearity there as well. Thanks.
Yes. So linearity in the quarter from an order’s perspective was very normal, right? We saw a very strong demand and bookings throughout the quarter. And we really didn’t see any sort of abnormally from a linearity perspective. That said, from a shipping and therefore invoicing, we did see a pretty backend loaded quarter. As I mentioned in my prepared remarks, we had some provider de-commitments and we had to kind of recover and react to that. So we did ship later in the quarter than we normally do that had an impact on DSO. It had an impact on the cash flow, but also had an impact on freight cost as we had to take faster routes to get products to customers in the commitments we made to them. So it had a negative impact on a few of our metrics.
Got you. Okay. That’s very helpful. Thanks, Ken.
Okay. The next question is coming from Alex Henderson with Needham. Alex, your line is live.
Great. Thank you very much. So $2.4 billion plus in backlog is an enormous backlog relative to the historical norms of the company. And as we look forward if I were to run what the equivalent of a bank stress test on your outlook for a CY2023, it looks like you could produce 20%, 30%, 40% declines in orders for the next three or four quarters and right through to the back end of 2023, still hitting at least mid-single-digits or plus revenue growth and still end up with a backlog that’s 250% to 300% of normal, is the backlog likely to increase as we go into the back half of the year? And how do you view these year-over-year declines versus the ability to sustain a book-to-bill somewhere in the broad vicinity of 1.0 as we go through the end of the year, because that’s are really the critical variables to the stability and visibility of the 2023 numbers.
Yes. So, I mean, you’re right. The backlog is unprecedented levels and, as how I see this year playing out, I can’t give you a precise number here. I will say this, I think they’ll remain elevated, kind of similar levels to where they are now. That would be my expectation as we kind of finish the second half of this year. And you are also are correct in that, the backlog should support our revenue for the next period of time, even if gross demand orders are down. And in fact, this quarter’s a good example of that, where we mentioned on the call that our orders were actually down single digits. But we not only delivered 10% product revenue growth. We also grew backlog $250 million, right? So there was a fair amount of room there in orders. And that just gives us confidence in our ability to generate revenue for sustainable future. And that’s one reason why we raised our guidance to at least mid-single-digits next year.
Yes. So, the key point of the question was, can you, in fact, if you went through a stress test analysis like a bank, absorb 20% or 30% declines for three or four quarters, and still end up with that massive backlog given where you are exiting 2023, and which case the only real question then is the improvement in the supply chains, your ability to deliver on better than 5% growth and in the top line over that timeframe that you clearly have the orders. And a put note to this, just want to clarify, when you talk about the geographies in your print, that’s a function of the timing of when orders came in. I assume these are first-in, first-out, and therefore not reflective of any particular change in demand in any particular geography, because it’s, your backlog increased. So therefore I assume it’s a allocation question, not a demand question.
Yes. So, you’re absolutely right. If you were to perform such a stretch, test our model, our revenue model, given the backlog, we have would still sustain at those types of declines in orders, those 20%, 30% declines. So your math is correct. And again, that gives us a lot of comfort in our revenue growth sustainability for the next couple of years here. On the geo mix, I would say it is absolutely a factor of what we’re able to ship? What supply we’re able to procure? It’s not quite as simple as first-in, first-out, because quite honestly, the supply chain is very dynamic, and we have shortages in some parts, and we have more parts available in others.
So it’s really about supply availability. And that really results in the revenue profiles that you see really across the board, geographically, as well as in some level – in some cases, the vertical cuts and the customer solution views is really about supply at this point.
Okay. The next question is coming from George Notter with Jefferies. George, your line is live.
Hi guys. Thanks very much. I guess, I wanted to ask about some of the mix items affecting gross margins. You mentioned lower software license sales in the quarter. Can you be more specific about what that was? I realize it’s lumpy, it was bigger in Q2 getting smaller in Q3 and Q4, but what precisely was that? And what drives that the cadence of revenue recognition there? Thanks.
Yes, George, let me take a crack at it. And then Ken, you can jump in. So total software grew at 24% year-over-year, that’s a good result, but it was down sequentially. And that affected our margins because of mix in the Q2 timeframe. The software softness was really all in our perpetual offerings. And those can be lumpy, they can be – they can swing around positively or negatively based on orders of state certain capabilities from some of the largest customers that we have for routing and switching products.
Subscription software importantly remains really strong, and you can see that in deferred revenue, you can see that in our ARR, which grew at 34% year-over-year. So, I’m actually really confident in our ability to achieve our long-term software projections [ph], as well as our ARR. And then Ken, you can talk a little bit more about the mix issues in Q2.
Yeah. So as Rami mentioned, it really was a bit of a shortfall sequentially in our on-box Junos Space to perpetual licenses. These really are various features and functions of services that provide within our Junos operating system. And there is some timing of refract that's difficult to predict here. Some of it is on customer buying behaviors, whether or not some customers might buy the lowest base level operating system software at time of purchase with an upgrade to maybe an advance or premium license later. There's also some true-ups between hardware and software that happens periodically.
So the timing of this recognition, it's all perpetual software, it's all recognized immediately, but the timing could vary based on what they buy and when they choose to buy it. So that's really what we're seeing here. Overall our software business continues to perform quite well. I think we're ahead of the targets we set for ourself a year and a half ago with the Investor Day both from an overall software perspective, as well as our ARR target. So I feel very good about our software transformation and moving forward, I expect us to continue to have a very strong software story.
Got it. And then just as a follow-up, I know last quarter, I think more of the narrative around margins was on a higher mix of missed access points, a lower mix of MX shipments, obviously components drove that mix shift, but can you talk about how MX did this quarter, how you did with access points, did the mix of those pieces go up or down in Q2? Thanks.
Yeah, so MX actually went up, so our hardware mix on the routing side and automated WAN side was up, that said some of these perpetual software licenses that I was mentioning before actually were attributed up to our automated WAN solutions. So the software mix with automated WAN was down a bit, some of these perpetual licenses that we've talked about, but overall the hardware mix was up. But it wasn't at the expense of access points. We continued to sell a lot of access points as well. You saw the results in IDE up 17%, so really strength in both the MX/automated-WAN business, as well as our IDE business.
Got it. Okay, thank you.
Okay. The next question is coming from David Vod with UBS. Your line is live.
Great. Thanks guys for taking my question. So I have sort of two related questions on margins. So I think in the prepared remarks, you noted that supply chain going forward is getting a little bit better. So kind of against that backdrop, if supply chain is improving on the margin sort of quarter-over-quarter, along with revenue that looks like it's going to be well above trend. Why are you not seeing more gross margin leverage in the third quarter, despite the expedited fees, but it sounds like it's getting better? And if expedited fees are about 50% above your prior expectations, does that give you confidence and a line of sight into potentially a 100 basis points of margin expansion next year, just basically effectively pushing it out by year, what you'd expected for this year as we entered the year? Thanks.
Yeah. So on the supply getting better, is really kind of a nuanced message I want to make sure is well understood. Access to supply is still highly constrained. Lead times into us are still extremely limited. That said we've taken some action to actually procure more supply. So I think we'll have more supply than we originally expected when we started the year, which is a good thing. So that's an improvement in supply, but it's coming at cost. And that's really the offset here is that we are paying more. We're having to pay more expedite fees. We're going to broker markets and paying several times more than we should be paying for this, for that particular component in the open market.
So it is coming at a cost. So volume is improving but costs are going up is probably the short summary on the supply side. For 2023 on the supply, was it a supply related question as well?
Well, I mean, Ken, I think you said, expedited fees came in about above your expectations. So that would translate into a little bit north of $50 million or almost the point of margin. So how does that play into next year?
Yeah, so I do believe those expedite fees and component costs the $155 million that I referenced is transitory and exactly the timeframe is difficult to predict, but I do believe if you go out, I don't know, a couple of two, three years you'll see the majority, if not all of those costs go away. However, the timing, how many – the expedite fees we're paying, the elevator freight we're paying it's hard to predict exactly what we're going to start to see that normalize. I do think we should see some benefit in 2023, but I'm not ready to quantify how much.
Great, thanks guys.
All right. The next question is coming from Simon Leopold with Raymond James. Simon, your line is live.
Thanks for taking the question. I want to see if you could describe within your backlog, what do you see happening in terms of the major product categories and your market share? I’m trying to get an understanding of where you’re gaining market share based on your awards versus where you might be?
Sorry. We’re going to interrupt you. Could you repeat the question? We had a little glitch here. So we missed a part of your question and sorry to bother you, but we’re going to need you to repeat it.
No problem. You hear me, okay, now?
Yes, we can.
Okay, great. I wanted to see if you could talk about within your pipeline, your backlog, how you see your market share trends in the major category? So what major verticals or products do you see yourselves gaining share the most and where do you see yourself most vulnerable in the mix? I know we’ve talked a lot about campus as an area where we’ve seen you gaining share. I want to see if you could talk a little bit more broadly about other product categories and just confirm the campus?
Yes, I’d be happy to. So I do think the one area where we are most obviously taking share is going to be in the enterprise and more specifically in the client to cloud. So that includes wired, wireless, and increasingly it’s going to include a full stack solution of wired, wireless and SD-WAN because we’re now pretty much integrated our 128 Technology SD-WAN solution into that end-to-end AI driven enterprise capability.
So the numbers speak for themselves, double-digit revenue growth, double-digit order growth and all that. Very, very pleased there. I don’t think that’s the only place where we’re taking share. I do think in terms of 400-gig opportunities now that 400-gig has moved from discussions and PowerPoints into competitive bakeoffs. I do think that we are winning share wherever there is a net new opportunity, be it for our service about our core, where I just talked in my prepared remark about our new win, new data center, cloud WAN opportunities. I do think and time will tell as this translates to genuine revenue results and genuine share results. I do think this is an area where we’re performing very well and we are taking share.
The last area that I will mention that I think is going to be an obvious place where we’re going to take share, because we’re really starting from very little is in the Metro. 5G is a real thing. It’s driving fiber build outs by service providers. We are essentially very small players in the Metro because we’ve never really had a complete portfolio and we just announced that complete portfolio and it should essentially come together and be fully in production by the early part of next year. So even in the absence of that solution, we’re seeing a 100 plus percent year-over-year growth in orders for ACX. I think that will only accelerate once we’ve got that complete solution. I’m sure there are other areas where we’re doing very well data center for example, but those the areas that I’d say are top of mind right now in terms of the biggest opportunity for share take.
Thanks for taking the questions.
My pleasure. Thank you.
Okay. Up next, we have Samik Chatterjee from JPMorgan. Samik, your line is live.
Hi, this is Angela Jin on for Samik. I don’t – I hate to ask the recession question, but I was curious how would each vertical respond in the event of a macro slowdown and what are the areas of a portfolio that you think are more resilient to a slowdown versus more aligned to cyclical trends?
Thanks Angela for the question. I’ll start, first, I think it’s a hypothetical question, because I said, I think order strength remains very high. We don’t see any obvious indicators that there is going to be macro headwinds, but of course it’s our job to stay very vigilant and to just make sure that we’re looking for any early warning indicators.
In terms of what one would expect would be with the other challenging areas, service providers and cloud providers tend to have very strategic long-term projects. And for that reason, I would expect that they would be more macro resilient.
But even in the enterprise where I would say that most people would expect that there might be the biggest risks if there were macro headwinds, there what we have going for us, as I mentioned earlier is we have massive TAMs, total addressable markets, 30 plus billions – billion dollars across our client to cloud and data center. We’re relatively small player with small share, a very differentiated solution and plenty of room to grow even if there are in fact macro headwinds that affect that TAM. And I think part of the results we’re posting are a little bit of a proof point for that.
Okay. The next question is coming from Aaron Rakers with Wells Fargo. Aaron, your line is live.
Yes. Thanks for taking the question. I hate to do this, but I want to go back to the backlog a little bit. You mentioned in the prepared remarks, I know you disclosed it in the past that you had implemented some price increases back, I think you said in 2Q of 2021. It sounds like you're going to implement some more actions here going forward. I'm just curious considering the significant amount of backlog that's likely been built over the past year let alone the $500 million through the first half or a $550 million through the first half the year. How do we think about those price actions starting to filter through that backlog and really starting to provide, maybe the positive effect to the gross margin understanding you've got a lot of supply chain dynamics going on?
Yes. So it is going to feather in over time. We are seeing more and more benefit each quarter. So Q2 this last quarter we saw more benefit than we saw in Q1. And I expect us to see more benefit here in the second half from the pricing actions. The actions we're about ready to take, we really aren't going to start to play until probably FY 2023, given the backlog. And again, I expect that to feather in overtime and be incremental over time as we move into the 2023 quarters.
The unfortunate reality is the benefit we're seeing is getting more than offset by the cost, right? When we put the actions in place, we had some assumptions on the incremental costs, the expedite fees, great costs, et cetera, and we undershot – we overshot I should say or the cost overshot those expectations. So we are seeing some benefit. There is more of the pricing benefit in the backlog yet to come, that's going to continue to help us in the future quarters. But at this point we just don't see that help enough to really keep the margin range where we started the year at 58 to 60.
Yes. And as – and just as a quick follow-up question on the continued traction that you're seeing in 400-gig, I know this quarter you had mentioned 80, I think last quarter you had mentioned 70 design wins. I'm curious if you were just asked like what inning do you think we're at in terms of kind of really volume deployments across those 80 design wins for 400-gig at this point? And when do you think actually we're halfway through those deployments, just kind of thinking about the trajectory of those 400-gig wins?
Yes. It's a good question. First, I want to just clarify. The 80 or so wins are data center 400-gig wins, we've actually we're now seeing close to accumulative 400 wins across data center and wide area in service provider and in the cloud provider segments. In terms of where we are, I mean, if you looked at port mix between 100-gig and 400-gig, both in terms of orders and shipments, it's still at early innings for 400-gig. There are a lot more networks that are going to be built out with 400-gig. So we viewed these sorts of network interface happen once every several years, maybe four or five years or so. We're now at the beginning stages of one of those inflections and that's good for our industry, certainly good for Juniper.
Yes. Thank you.
Okay. Next we have Meta Marshall with Morgan Stanley. Meta, your line is live.
Great. Thanks. Maybe following up on the answer to George's question, you mentioned kind of some uncertainty on what addition might be elected in terms of kind of where the perpetual revenue comes in for software. I was just trying to get a sense of some of that volatility more – more pronounced this quarter just because of the amount of kind of cloud customers that you're servicing or just trying to get some insight into what is causing that volatility? And then maybe just as a follow-up question; just is this kind of quarter where you would consider inventory peaking, or do you still think that you'll be in an inventory kind of accumulation period for the kind of foreseeable future? Thanks.
Yes. So on the software volatility, we did, I mentioned buying patterns vary and the reality is in Q4 of last year and Q1 of this year, we saw some of those above normal buying patterns where customers were either doing true-ops or maybe upgrading their software system from a base level to a more advanced or premium level. So we did see some of the, kind of the high water marks of that volatility in the past few quarters. In Q2, I think we saw a little bit more of a normal kind of hardware to software attach, and at this point I'm expecting the rest of the year to be largely similar to Q2. That said customers could surprise me and might upgrade their software stack here in the futures and will obviously be available for that when – if they decide to do that.
So it's difficult to predict. I wouldn't call it out as any sort of customer pattern. It's really just more about timing of when they purchase perpetual software. And we had a couple quarters of highs and now I think we're back to kind of a normal from a perpetual perspective, as Rami mentioned, our subscription software, our SaaS software is growing well beyond normal, right. We continue to grow at extremely high levels on that part of our software portfolio.
From an inventory perspective, I don't think we've seen the end of the inventory built. You know, we are still, if you look at our, open purchase orders we are absolutely putting a demand signal out there that supports what we think is our demand opportunity. And that's a, that's going to result in more inventory, what's happening out there is you're, we are definitely seeing constrained in certain parts, but there's other parts of the bill of material that are not constrained. And that's really the part of the inventory that's building up, as we start to get some of the more critical parts, we'll be able to ship, our backlog and we'll see the inventory level start to go down.
So I don't think inventory's going to start to, decline until we start to see supply chains really Improve and backlog levels start to come down.
Operator, we'll take two more questions.
Okay. The next is coming from Sami Badri with Juniper. Your line is live.
Hi, thank you. First question is, if we were just to take the percentage of revenues in 2022, that reflect the price increase actions, what percentage of those revenues are coming through, and what is the objective of 2023, will 2023 reflect all price action increases and maybe just like a percentage mix of 2022?
Yes. I'm sorry, Sami but that's not a level of detail I'm prepared to comment on, on this call. I'll say that, I would expect it to normalize by, call of four quarters out. So by the late this year, we should see some normalization from the action we took last year. But as far as the percentage of total revenue, I'm not prepared to comment on at this call.
Okay. Next we have Tal Liani with Bank of America. Tal, your line is live.
Hey, guys I want to go back to your 2023 guidance. It, I tried to look at it multiple ways and it looks to me either that you're banking or you're assuming very steep decline in revenues, in certain areas or that you're just very, very conservative. In the four quarters of this year, your growing revenues, the low is 8.3. The high is 13.5, so there is substantial growth this year. And next year we should see some of the backlog released, being released. So 5% looks, looks weak versus what we're seeing this year.
And then also, if I just look at your enterprise growth, this year substantial growth, it's about 35% of your revenues plus that alone contributes 4% of revenues give or take next year. So what are your assumptions when you say 5% or better, the 5% mark, which I understand it's going to be better? What are your assumptions about the telecom market about the cloud market? When you project 5% or more, are you assuming end of projects, are you assuming declines or what are basically your basic assumptions in saying 5%?
Let me start, I think the key here is that we didn't say it's 5%. We said, it's, at least 5%, or at least mid single digits. If in fact the markets play out, as we expect, and there aren't any major sort of challenges macro wise. Yes, the opportunity is absolutely there for us, not just to meet, but to exceed that's bar that we are setting for ourselves. It's just a little early right now. I don't think we typically provide color on the next year in this timeframe, but we thought we'd start at this point in time. And yes, I mean, I've talked quite a bit, even on this call alone about some of the catalysts around 5G clarification efforts, 400 gig enterprise. Yes. I mean, I think these are all catalysts that can give us the opportunity to exceed that outlook.
And I would just comment, its demand is not the primary driver of our revenue outlook for 2023. That given the backlog, given the strength, we seeing the momentum we have, all the things Rami has mentioned demand would definitely imply, a higher level than a, mid at least mid single digits. It's really a supply, a constrained view at this point. And the good news is we see the supply, constraints being lessened. We expect volume to improve, which is why we thought giving you a number greater than what you had historically, which was at least low single digits with the prudent thing to do at this point.
Thank you, Operator. That's all the questions we have. That concludes today's call.
Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.
5G is the most cost-effective way to bring broadband access to South African homes outside the reach of fibre networks, according to Wits digital business chair professor Brian Armstrong.
During an NEC XON 5G OpenRAN event this week, Armstrong explained that it typically takes five years after a new network standard has been deployed before its benefits begin being realised.
“When 3G networks were commercially launched between 2003 to 2005, there was initially no data usage,” Armstrong said.
“It was only after approximately five years that we found a use-case for 3G technology.”
Armstrong said it was only after Apple introduced the iPhone in 2007, presenting a use-case, that global mobile traffic started to increase exponentially.
He also demonstrated how analyst forecasts underestimate demand for a new technology.
Once uptake is in full swing, the forecasts become accurate. However, before that, they tend to wildly underrate the impact of an emerging technology.
Before widespread 3G network deployments, the International Telecommunication Union’s forecasts completely underestimated the demand for mobile data by a factor of 10 to 100 times.
Similar to 3G data consumption forecasts, Armstrong believes we are likely underestimating the impact that 5G will have on data consumption.
Regarding 5G’s role in South Africa, Armstrong explained that fibre network operators prioritise certain areas and income groups.
For example, although Vumatel has announced a product for less affluent households called Vuma Key, this will initially target densely populated urban townships.
Armstrong said forecasts indicate that only about half of the lowest priority areas, including small rural municipalities, will have access to fibre by 2028.
“Even with the most optimistic assumptions, 6.1 million homes will remain without fibre,” he said.
Armstrong explained that although options like wireless last-quarter-mile services can extend fibre coverage, 5G will be crucial to providing a fibre-like experience to households without fixed-line services.
He said an open radio access network (RAN) 5G model is one of the most viable ways to bridge South Africa’s broadband access divide.
NEC XON general manager of networks Anthony Laing said that an open RAN model is ideal for deploying mobile Internet in Africa because of its flexibility and cost-effectiveness.
“Typically, mobile network operators would only have a few vendors to choose from when deploying new networks,” he said.
“Open RAN allows telecommunications providers to build networks with similar functionality but allows the use of components from multiple vendors,” said Laing.
Laing said NEC XON managed to build a functional end-to-end Open RAN lab and launched it last week at the company’s head office in Midrand.
NEC XON’s multi-vendor 5G Open RAN network consists of Red Hat, Dell, Druid, Rakuten, ADVA and Juniper Networks.
A popular brewery has moved into the world of distilling – having launched its first gin.
Bowland Brewery, based at Holmes Mill in Clitheroe, has launched its signature gin following an exclusive event held on Wednesday evening.
The brewery worked to handcraft the gin in the copper distillery at the back of the Spinning Block Bar, Bistrot and Grill.
Managing director, Warren Bennett, said: “The beer hall here at Holmes Mill runs because of the brewery and here in the Spinning Block, we follow the same concept.
“Having the distillery on display, we want people to come down, see the machine that the gin they are drinking is distilled in, the same way people can see the brewery when they have a beer.
“We went into this as part of the diversification post-Covid. We were thinking about what we could do and a lot of our staff drink gin, so we decided to do that.”
The London Dry Gin is handcrafted using juniper, orange and chamomile botanicals in the brand new distillery the brewery invested in during the Covid-19 lockdown.
They collaborated with Alcohol Solutions to create the gin who spoke with them about what Holmes Mill wanted from the product, and both the distillers and brewers are elated with how it has turned out.
One of the distillers from Alcohol Solutions, Dave Rigby said: “Ten years ago, it was Beefeater, it was Gordons but now, ten years on, people are more open to the fact that gin can be anything.
“The first thing we had to do was understand the brewery here and what they wanted from the gin.
“We spoke to them, and I think what we have made really is one of the best gins out there.
“It’s simple, it’s accessible, it’s not snotty, it’s just fabulous and unique.”
When you're a digital nomad, the world is your office. With a lifestyle that only requires a laptop and Wi-Fi — you can ramble wherever you please. But the staggering amount of destination options (literally anywhere on the planet) can become overwhelming when choosing where to log on.
Luckily, Reviews.org has scoured the country and ranked the top cities in the U.S. for digital nomads.
The cities were ranked on "seven different factors such as average metro area internet speed, # of free wifi hotspots, average short-term rental stay cost, miles from nearest airport, national parks, and more," the company shared with Travel + Leisure.
Coming out as the best city in America for digital nomads is Seattle, Wash. The city ranks highest in the country for its number of Wi-Fi spots available — not to mention an enviable amount of coffee shops where you can post up for the afternoon. The internet connections that you'll find in Seattle are rated at number 21 on the list, with an average speed of 111 mbps. But if you're thinking of temporarily settling in Seattle, be sure to budget properly. Nightly rates for Airbnb rentals in Seattle are an average of $191 (one of the more expensive options on the ranking).
Traveling remote workers can also take advantage of Mount Rainier National Park only 44 miles away. And when it comes time to switch to your next destination, the airport is only 10 miles away from town.
Some of the biggest cities in America appear further down the list than you might expect. New York City only ranks at number eight in the list and Los Angeles comes in at number 16, due to their surprisingly low number of Wi-Fi spots.
In general, coastal cities dominated the top spots on the list. Portland, Ore. came in at number two and Atlanta and San Jose were close behind.
The International Award-Winning Creative Rises From Her ECD Role To Lead The Agency Into A New Era
TORONTO, June 16, 2022 /PRNewswire/ -- Juniper Park\TBWA is proud to announce the appointment of Jenny Glover as Chief Creative Officer, effective immediately. Jenny is one of the most awarded creatives in the world – her work has won golds across all major international award shows, amassing twenty-eight Cannes Lions, including ten Gold and a Grand Prix, plus fifteen coveted D&AD Pencils, including five Yellows, among numerous others.
Her entry into branding was unique – she graduated from law school in 1996, which honed her skills in the nuances of language and critical thinking. After twenty years in South Africa, Jenny joined Juniper Park\TBWA from its sister agency, TBWA\Hunt\Lascaris, in 2018. This year alone, Jenny was the Co-Chair of one of Canada's preeminent industry shows, the 2022 Marketing Awards, as well as a One Show jury member. She has acted as both jury president and judge on numerous occasions at both local and international festivals, including Cannes Lions.
"I'm excited to continue my creative leadership of this agency," says Jenny Glover, CCO, Juniper Park\TBWA. "Of course, the ultimate goal is always to create branding excellence for our clients, but my methodology is also fundamentally human – to stay creatively curious, keep pushing, and to create better work by nurturing and growing talent. For me, the work and the people are intrinsically connected."
Jenny has a long history of generously developing talent. During her time in South Africa, she co-founded Open Chair, the South African advertising industry gender equity initiative aimed at "filling chairs" with talented young women and putting the onus on leaders to offer opportunity to that talent. Always an active mentor, Jenny incorporates teaching into everyday work, running weekly creative training sessions – aptly called "Sucking Eggs" – and presenting thought leadership masterclasses for the global TBWA collective.
"Beyond borders, Jenny is one of the best creatives in the industry and she epitomizes our core agency values of gratitude and growth," says Jill Nykoliation, CEO of Juniper Park\TBWA. "She combines world-class creativity with unwavering humanity, which makes her beloved by both our team and our clients. Jenny leaves an indelible mark on people's careers."
Coming off the back of two Golds at the 2022 Clio Awards, Jenny joins the agency's high-calibre, award-winning executive team, which includes Chief Strategy Officer Des Jones, who recently joined the agency from TBWA\Hunt\Lascaris and was instrumental in the development of TBWA's new strategic methodology, DisruptionX, and CEO Jill Nykoliation, who was recognized as one of Canada's Most Powerful CEOs in 2021 by WXN. She also becomes a member of TBWA's global creative core, a roundtable of creative leaders composed of CCOs from the collective's top agencies.
"I'm excited for the entire TBWA collective that Jenny has been elevated into the CCO role to guide and influence the entire creative product of Juniper Park\TBWA," added Ben Williams, Global Chief Creative Experience Officer, TBWA\Worldwide. "She has helped create some of the most famous work within TBWA and has been recognized by the industry time and again. I can't wait to partner with her to bring more Disruptive creativity to the world."
About Juniper Park\TBWA
Juniper Park\TBWA (juniperparktbwa.com) is The Disruption® Company: the cultural engine for 21st century business. A global, award-winning agency located in Toronto, Juniper Park\TBWA uses Disruption® methodologies to develop business-changing ideas for brands. The 130+ team of world-class creators and thinkers serves clients across North America, including CIBC, Nissan, PepsiCo, GoDaddy, among others. It is part of TBWA Worldwide (tbwa.com), named Agency of the Year and Grand Prix winner at the 2021 Effie Awards, one of the World's Most Innovative Companies by Fast Company in 2019, 2020, 2021, and 2022, included on Ad Age's Agency A-List in both 2019 and 2020, and named Ad Age's Network of the Year in 2022. Follow us on Instagram, LinkedIn, and Twitter, or like us on Facebook for the latest updates from the Park.
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SOURCE Juniper Park\TBWA