Updated from 4:50 p.m. EDT Juniper ( JNPR) met lowered first-quarter guidance amid the tech-spending slowdown.

The Sunnyvale, Calif.-based Internet gearmaker posted an adjusted profit of 17 cents a share, down a dime from the 27-cent profit in the year-ago quarter and in line with First Call estimates.

Including one-time items, like a $61.8 million tax-related charge, Juniper posted a penny net loss, well below the 22-cent profit of the year-ago period.

Sales for the quarter ended last month were $764.2 million, down 7% from last year and in line with analysts' estimates.

"Juniper has responded well to the challenging macroeconomic environment," said CEO Kevin Johnson.

Despite "aggressive" costs cuts, Juniper's operating margin narrowed to 10.6% in the quarter, down from 17.3% a year ago.

Juniper is one of the first networking equipment suppliers to report first quarter earnings and the company's business outlook tends to influence the investment opinion of the sector. Results for outfits like Cisco ( CSCO) Ciena ( CIEN), Ericsson ( ERIC) and Alcatel-Lucent ( ALU) also depend heavily on telco spending.

In fact, there has been a growing debate over how Cisco has been faring in this spending-constrained market. Short interest, the amount of stock investors are borrowing on the hopes of paying back later at a lower price, has reached a one-year high recently. Some investors are betting that the stock will fall as the recession spreads beyond the U.S. and Europe.

Juniper shares jumped $1.44 or 7%, to $20.70 in afterhours trading Thursday after the company said it saw stability in the tech spending market.

Cautioning that visibility ahead was limited, Johnson told analysts on an earnings conference call that the "environment seems more stable than it was early in the first quarter."

Looking ahead, Juniper says it expects sales for the June quarter to be flat with the first quarter. The company said adjusted earnings per share are likely to be in a range between 16 cents and 18 cents, for a midpoint of 17 cents.

On sales, Juniper again said it had low visibility but put its target range between $740 million to $780 million, making for a midpoint of $760 million. Analysts surveyed by Thomson First Call expected Juniper to post a 17-cent adjusted profit on sales of $773.5 million.

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