Network-equipment vendor Juniper reported less-then-stellar preliminary results for the fourth quarter of 2011, something the company’s executives said they did not anticipate. Its revenue, compared to results it reported in the fourth quarter of 2010, shrunk and so did its operating margin.

The company’s president and CEO Kevin Johnson attributed the unexpectedly low results to a drop in demand for its products from service providers and to a troubled economy.

"While the fourth quarter was softer than we had anticipated primarily due to weak demand from service providers, Juniper delivered record revenues in a year where macro-economic uncertainty increased as the year unfolded,” Johnson said.

Juniper reported revenue of about US$1.12bn for the quarter, or 6% down year over year. Its net earnings per share (EPS) were $0.18.

For the full year, Juniper’s total revenue was about $4.45bn – up 9% from 2010. Full-year EPS were $0.79 – a net income of $425.1m.

Juniper’s operating margin went from 19.1% in the fourth quarter of 2010 to 11.9% in the final three months of 2011. Its full-year operating margin was 13.9% for 2011 – down from the 18.8% it reported for 2010.

The company’s CFO Robyn Denholm said some of its largest customers had reduced spending in the fourth quarter, and that Juniper did not expect to get over the hump in the near future.

"The December quarter was an atypical and unexpectedly weak finish to the year, with reduced spending by some of our largest customers,” she said.

“While long-term industry fundamentals remain strong, we expect the near-term environment to remain challenging. We will invest in support of our strategy while continuing our focus on execution and prudent cost management.”

In February 2011, Juniper made a major push into the data center switch market, announcing its proprietary network technology called QFabric - something that had reportedly been in the works for four years. The products compete directly with Cisco’s and Brocade’s data center fabric technologies.

All three companies’ key pitch for their fabric products is “flattening” the network (or collapsing the number of layers in a system) and simplifying network management.

Juniper says its fabric allows for a single hop between any two devices on the network.