- Fresh off its Juniper acquisition, HPE is making moves in the router and switch markets with new products announced this month
- It is facing off with key competitors Cisco and Huawei in these areas
- AIOps has emerged as a key component of its strategy to win over customers
It’s been just six months since HPE closed its acquisition of Juniper Networks with the goal of becoming an AI networking titan. And the deal already seems to be paying dividends.
New data from Dell’Oro Group shows that HPE’s third quarter ethernet campus switch revenue grew above the market rate and are now on par with those of Chinese tech giant Huawei. The analyst firm previously tipped worldwide campus switch sales to top $20 billion this year.
Siân Morgan, Research Director at Dell’Oro Group, told Fierce via email: "The combination of Juniper and HPE campus switch revenues in 3Q24 grew by four times the market growth rate, so there are no obvious signs of cannibalization between the two companies’ campus switch sales." That said, she noted with only one quarter of combined sales in the bag, it's hard to deduce any long-term trends.
"Huawei was hampered by a sharp downturn in revenue from China, where HPE has little exposure," she said, noting that's a big deal since China represents about 40% of Huawei's campus switch revenue. "This means that HPE’s ability to move into a solid second place market share position in the campus switch market will depend on how well it can hold its ground in North America, the expansion it can secure with sales of Juniper’s switches outside North America, and the performance of the China market for Huawei."
Morgan added the Q3 numbers foreshadow “an intense battle in upcoming quarters.”
Separately, Dell’Oro this week highlighted HPE as one of the top three core router vendors in Q3, coming in – once again – just behind Huawei.
Cisco leads in both the campus switch and core router markets. In the former market, Dell’Oro noted competitors are looking to peel away customers who are looking to refresh their old Cisco ports. One way they’re looking to do this is by “by touting high performance hardware and AIOps features,” Morgan said.
HPE remade
Indeed, with Juniper now part of the fold, HPE is pushing to prove its networking and AIOps bona fides.
At its recent HPE Discover event in Barcelona, the company talked up networking launches spanning data center on ramp, scale across, scale out and scale up. These include a new QFX5250 switch – courtesy of Juniper – built on Broadcom’s Tomahawk 6 technology for intra data center switching and a new MX301 edge router (again, from Juniper). It also teamed with AMD to provide scale-up Ethernet networking for AMD’s Helios architecture.
“We want to be known as leading the convergence of AI and networking,” Jeff Aaron, HPE’s VP of networking product and solution marketing, told Fierce in a post-event interview.
“All of these areas, we need to own. A lot of this is our wheelhouse,” he continued. “We’ve been doing LAN, we’ve been doing scale across, we’ve been doing scale out for decades. It just happened that AI workloads have increased demand for it…but this is our birthright.”
Both Discover and Aaron also placed a huge emphasis on AIOps, with HPE talking up its early moves to integrate Juniper Mist and Aruba. In short, it’s starting cross-pollinating features – like Mist’s Marvis Actions and Aruba’s client profiling – between the two platforms and announced the first common access point that can be used for either.
Aaron characterized the announcements as just the first steps in HPE’s journey to deliver a “common self-driving experience” across both platforms.
“We like to say that we did more in six months with the acquisition than Cisco’s been able to do in Meraki in 13 years,” he quipped.
Looking ahead, Aaron said HPE’s goal is to deliver a portfolio across switching, routing, wireless, SD-WAN and SASE that shares a common vision. Throughout the coming year, he said more cross pollination and common hardware is on the way. The hardware element, he added, will be introduced “expeditiously and judiciously” so as not to pull the rug out from under any customer and take advantage of key technology upgrade cycles, like the introduction of Wi-Fi 8.
For the record, a number of companies including Broadcom are already working on Wi-Fi 8 products, though the standard isn’t expected to be finalized until 2028.
Morgan argued that for HPE, there's still plenty of hard work to be done.
"The company now needs to converge the product lines in a timely manner without alienating customers or channel partners," she said, adding the Discover announcements were a good start. "The company needs to continue on that path, and succeed in converging sales teams and channel partner relationships in order to make a success of the acquisition."
Earnings
HPE reported earnings last week with fiscal Q4 revenue up 14% year on year to $9.7 billion. Server revenue was down 5% and hybrid cloud revenue dropped 12% but networking revenue jumped 150% to $2.8 billion. Despite the server drop, CEO Antonio Neri said it signed $6.8 billion in new AI system orders in its fiscal 2025 and on the hybrid cloud front added 7,000 new GreenLake customers to end the year with a total of 46,000.
Looking ahead, CFO Marie Myers said during the call the company expects networking revenue growth in 2026 to come in at between 65% and 70%. But factoring in Juniper's cut, "the approximately $11 billion in revenue now translates to a mid-single-digit growth on a pro forma basis," she said.
Neri said HPE is "on track to achieve networking for AI cumulative order target of $1.5 billion by the end of fiscal year '26."
12/11/2025 2:30 pm ET: This story was updated to include expanded comments from Siân Morgan.