DOJ clears road for HPE's $14B Juniper Networks acquisition
HPE will need to sell off its Instant On wireless networking business and license source code for Juniper's Mist AIOps software.
Hewlett Packard Enterprise this weekend reached a settlement in the U.S. Department of Justice's antitrust lawsuit to block the $14 billion Juniper Networks acquisition, clearing the way for the biggest networking deal so far this year.
The DOJ settlement is contingent on the combined company divesting HPE Networking Instant On wireless and requires licensing Juniper's Mist AIOps source code for its WLAN products. The settlement requires judicial approval, which would nullify the trial scheduled for July 9.
The antitrust lawsuit, filed in February, asserted that the HPE-Juniper merger would stifle competition and leave two companies -- HPE and Cisco Systems -- with more than 70% of the U.S. networking equipment market. HPE's Intelligent Edge segment, which includes its Instant On business, generated $1.2 billion in revenue for the first quarter of 2025, according to HPE's Q1 earnings report.
Instant On, which offers a line of wireless access points and switches, is aimed at SMBs and public entities. The business line competes with Cisco Meraki Go, Ubiquiti and Cambium Networks.
HPE must sell off the Instant On business -- including assets, intellectual property and R&D personnel -- to a DOJ-approved buyer within 180 days. HPE must also hold an auction to license Juniper's AIOps for Mist source code. The license will be perpetual, non-exclusive and include optional transitional support and personnel transfers to facilitate competition, according to the DOJ.
The DOJ touted the trial-subverting settlement as a win that allows the merger to advance, while ensuring competitors have access to key software assets.
Tactical advantage for HPE, despite caveats
Analysts believe the settlement is a win for HPE despite the stipulations.
"HPE agreeing to a series of conditions on … its AIOps for Mist business is a minor road bump as it enables HPE to sidestep going to trial, further delaying moving forward," Ron Westfall, an analyst with HyperFrame Research, said in an email. "This in itself is a major sales and marketing victory for HPE as the HPE Juniper portfolio is solidly positioned to win more AI networking business, directly challenging Cisco and providing more of a competitive threat to other networking players such as Arista and Extreme."
Westfall said the sell-off of Instant On is a "small price" to pay for the merger's potential advantages. "HPE retains all-important, non-Instant On HPE Aruba Networking assets, along with retaining full ownership of Mist AIOps," he said.
Juniper will add to HPE's portfolio across multiple segments, including routing and switching, SD-WAN, SASE, security, management software, AI-native acceleration and optics. "DOJ objections to the WLAN market segment distracted from HPE's compelling portfolio in high upside market segments across AI, hybrid cloud, computing, supercomputing, storage, non-WLAN networking, software and services," he said.
Michael McDowell, principal analyst at Nand Research, agreed that the DOJ's demands will not sour the deal.
"[HPE CEO] Antonio Neri and his team clearly feel the upside outweighs the concessions," he said in an email.
Regardless, he added that, while the Mist AI licensing concession won't give competitors a meaningful advantage, "giving up parts of the sales and, more importantly, the Mist engineering team could slow things a bit for HPE. If there is any sting from the concessions, it will be the loss of Mist talent."
McDowell said main competitor Cisco will likely not be interested in licensing Mist since it has matured, in-house alternatives. Smaller competitors such as Extreme Networks and Fortinet could emerge as likely Mist license bidders, he said.
"Speed is the name of the game in AI development and the mandated licensing of Mist is a gift for both Extreme Networks and Fortinet," McDowell said.
Will Townsend, vice president and principal analyst at Moor Insights & Strategy, said the settlement "ends the unnecessary distractions." Juniper's Mist AI software will strengthen HPE's Aruba Networking portfolio, and main takers for Mist licensing will likely be smaller consumer Wi-Fi service providers, he added.
"I highly doubt that other enterprise networking infrastructure providers will pay to license the software, considering how far HPE's competitors are along with their own AI development paths," Townsend said.
During a press conference at HPE Discover in Las Vegas last week, Neri seemed confident about the potential merger, saying, "I'm excited with the acquisition of Juniper, our optics and their big infrastructure and service providers and cloud … to power these new AI data centers is a massive opportunity for us."
In several interviews following the DOJ’s lawsuit announcement in January, Neri said he believed HPE would prevail and that the company would remain committed to closing the Juniper deal.
"HPE needs to proactively demonstrate that its offering can deliver the same or better [customer experience] across combined HPE and Juniper portfolio assets," Westfall said.
HPE stock opened about 12% higher on Monday, at $20.61 per share. Juniper saw an early trading bump as well, gaining about 8% at market open at $39.93 per share -- a 52-week high.
Shane Snider, a veteran journalist with more than 20 years of experience, covers IT infrastructure at Informa TechTarget.
