UPDATE 1/10 12:30 AM ET: HPE has announced that it will buy Juniper Networks for $14 billion, in a deal that is expected to close early in 2025.
Juniper's CEO, Rami Rahim, will lead the combined HPE networking business once the deal is completed.
The HPE move on Juniper may well be motivated by it’s artificial intelligence (AI) needs. Using the AI expertise derived from Juniper’s popular Mist AI platform, HPE could develop AI-powered enterprise systems that could further automate business networking.
AI is driving M&A in these times. For instance, while Cisco's recent $28 billion buyout of Splunk was hugely motivated by the nearly $3.9 billion in annual revenue Cisco will gain by owning Splunk, it was also partly driven by Splunk's generative AI capabilities, which Cisco could use in future network products.
While some are lauding the HPE deal, Analyst Zeus Kerravala raised the caution flag when he said on X that Juniper's Enterprise portfolio, "which is where the focus has been since it bought Mist, has nearly 100% overlap with Aruba" which HPE bought in 2015.
The merger is another sign of the increased consolidation of the U.S. networking giants. All the big names buy up networking startups, but we progressively see big companies buying up their established rivals on the networking scene. (See image below.)
HPE buying Juniper could just be the latest sign of that — especially considering the Aruba overlap.
Consider Broadcom’s protracted buyout of VMware last year, and wait for more to come.
We’ll update this story if and when things change.