Hewlett Packard Enterprise‘s plans to snap up rival networking firm Juniper Networks is making some tech bigwigs worry about how the deal will shake up the wired and wireless networking market.
The £10 billion takeover – expected to wrap up by the end of this year or early 2025 – would give HPE the extra AI networking clout it needs to take on the likes of Cisco Systems.
Cisco Chair and CEO Chuck Robbins said it’s still too early for customers to ask about the megadeal even if the new combo would create room for direct competition with Cisco’s wireless kit.
“The one area where they have a lot of overlap is in wireless, and I don’t know if there’s any link to the fact that we had a 50 per cent increase in £1 million-plus wireless deals one after the other. So, it’s hard to say,” he said.
“There is a lot of noise in the industry, so I think it’s a bit early.”
During its latest fiscal quarter, Cisco saw “more caution” about product orders, which lowered product revenues.
Cisco’s networking arm, which includes its wireless and core switching and routing businesses, is usually a strong component for the company and one of its main growth drivers.
In Q2 2024, however, Networking posted a 12 per cent drop with revenues of £5.1bn year over year. The company said that drops hit the quarter in switching, wireless and optical networking, driven mainly by enterprise, service provider, and cloud market weakness.
Cisco Systems is currently worth £143.5 billion. By comparison, HPE is worth £14.3 billion, and Juniper Networks’ market cap is £8.6 billion, according to the Nasdaq.
The deal will give HPE a complete data centre solution, including storage and servers, and a the full wired and wireless networking solution.
