AT&T, Verizon Dial Back Juniper's Prospects

Sometimes success in the technology arena boils down to little more than how big a check Randall Stephenson and Lowell McAdam plan to cut. The chief executives, respectively, of AT&T and Verizon have a combined annual capital-expenditure budget of over $35 billion. Unfortunately for Juniper Networks, and many others lately, those checks aren't growing.

Juniper joined the chorus citing weak spending by "service providers" like AT&T and Verizon as the reason behind December-quarter results coming in below expectations. Texas Instruments, Acme Packet, Cavium and Altera, among others, had made similar statements. Knowing that 60% of Juniper's sales are to service providers, Juniper investors were already prepared for the worst. Its shares didn't react much on Monday, though they are already down 33% in the past six months. But investors shouldn't expect much to change. Spending at AT&T and Verizon isn't getting a boost any time soon.