ANET changes
Pick any two versions below to diff them.
- Price
- $168.86 → $196.68(+16.5%)
- Discount category
- Below intrinsic value → Close to intrinsic value
- Next earnings
- Nov 3, 2026 → Feb 3, 2027
- Next earnings is estimate
- No → Yes
- About
- Arista Networks sells Ethernet switches and routers, and the software that runs and monitors them, for AI and cloud data centers, campus networks and wide area networks. All its switches run one operating system, EOS, and its CloudVision software manages the network. Its largest customers are large cloud and AI companies. Revenue was $9.006 billion in 2025. In removed: Q2 added: Q3 2026, revenue was removed: $3.036 added: $3.658 billion: products gave removed: $2.605 added: $3.190 billion and services gave removed: $430.5 added: $467.6 million.
- Thesis
- The market doubts that Arista's fast growth can last, because a few very large customers buy most of its products. Two end customers gave 26% and 16% of revenue in 2025. Their spending on AI networks can change quickly, and they can also buy from other suppliers or use switches that they design themselves. removed: GAAP gross margin also fell to 62.9% in Q2 2026 from 65.2% a year earlier, as supply added: Supply of memory and silicon removed: became added: is tight and costs removed: rose. added: are higher, so GAAP gross margin was 63.6% in Q3 2026, down from 64.6% a year earlier. For the gap to close, three things must be true. Revenue must keep growing fast into 2027; it grew removed: 37.7% added: 58.5% in removed: Q2 2026. added: Q3 2026, and Arista guides Q4 2026 revenue of $3.9 billion to $4.0 billion. Gross margin must stay near the level of 2026. Growth must come from more customers, in AI back-end networks, enterprise campus and routing, so that the two largest customers matter less. The removed: Q3 2026 report on November 3, 2026 is the next test, with guidance of about $3.3 billion of revenue. The Q4 2026 removed: report added: report, expected in early removed: 2027 added: February 2027, is the next test and gives the 2027 outlook. added: The 2026 annual report then shows how much revenue the two largest customers gave in 2026. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is a slowdown in AI spending by its largest customers.
- Risks
- Two end customers gave 26% and 16% of revenue in 2025. If one of them spends less on networks, uses another supplier or builds its own switches, revenue can fall quickly. GAAP gross margin removed: fell to added: was 62.9% in removed: Q2 2026 added: the first nine months of 2026, down from removed: 65.2% added: 64.5% a year earlier. Supply of memory and silicon is tight, and costs are higher. If costs keep rising, the margin can fall further. Arista had removed: $9.7 added: $11.4 billion of purchase commitments that it cannot cancel at removed: June added: September 30, 2026, to meet AI removed: demand. added: demand, and inventories rose to $3.21 billion from $2.25 billion at December 31, 2025. If demand falls, it can have excess inventory and write-downs. Tariffs and other trade measures can raise the cost of products that contract manufacturers build outside the United States.
- Balance sheet
- Cash: removed: $13.3B added: $14.4B Debt: $0.0M Net cash: removed: $13.3B added: $14.4B Arista Networks has no debt. At removed: June added: September 30, 2026, cash and cash equivalents were $2.29 billion and marketable securities were removed: $11.05 added: $12.07 billion, a total of $14.36 billion. Customers paid in advance for much of this cash: deferred revenue was $5.10 billion in current liabilities and removed: $1.77 added: $1.74 billion in non-current liabilities. Cash flow from operations was removed: $2.78 added: $3.98 billion in the first removed: six added: nine months of 2026. added: Inventories were $3.21 billion at September 30, 2026, up from $2.25 billion at December 31, 2025. Arista had removed: $9.7 added: $11.4 billion of purchase commitments for components and products added: that it cannot cancel at removed: June added: September 30, 2026, of which removed: $9.4 added: $9.3 billion it expects to receive within 12 months. It bought back no shares in the first removed: six added: nine months of 2026, and $817.9 million of buyback authorization was left. As of removed: Jun added: Sep 30, 2026.
- Checkpoints
- Nov 3, 2026: Q3 2026 results: growth and gross margin. removed: Pending. added: Passed. Watch: Revenue at or above the guided $3.3 billion with a stable gross margin pass; revenue below guidance or a further fall in gross margin fail. added: Outcome: Revenue was $3.66 billion, above the guided $3.3 billion, and GAAP gross margin rose to 63.6% from 62.9% in Q2 2026. Feb added: 3, 2027 (estimate): Q4 2026 results and 2027 outlook. Pending. Watch: A 2027 outlook for fast growth from more customers passes; slower growth or a larger share from the two largest customers fails.
- Recent events
- added: Nov 3, 2026: Arista reported Q3 2026 results. Revenue was $3.658 billion, up 58.5% and above the guided $3.3 billion. GAAP EPS was $1.22 and non-GAAP EPS was $1.20, above the guided $1.06 to $1.08. The GAAP gross margin was 63.6%, up from 62.9% in Q2 2026 but down from 64.6% a year earlier. For Q4 2026, Arista guided revenue of $3.9 billion to $4.0 billion, a non-GAAP operating margin of 48% to 49% and non-GAAP EPS of $1.26 to $1.30. Oct added: 7, 2026: Arista announced liquid-cooled Ethernet rack-scale systems for AI networks, made with partners that include AMD, Broadcom, Meta and Microsoft. The Etherlink SU-144 design connects up to 144 accelerators in one rack. Oct 6, 2026: Arista said that it will report Q3 2026 results after the market closes on November 3, 2026, with a call at 1:30 p.m. PT. Aug 4, 2026: Arista reported Q2 2026 results. Revenue was $3.036 billion, its first quarter above $3 billion, up 37.7%. GAAP EPS was $0.95 and non-GAAP EPS was $1.02. The GAAP gross margin was 62.9%, down from 65.2% a year earlier. For Q3 2026, Arista guided revenue of about $3.3 billion, a non-GAAP operating margin of 48% to 49% and non-GAAP EPS of $1.06 to $1.08. May 5, 2026: Arista reported Q1 2026 results. Revenue was $2.709 billion, up 35.1%, and non-GAAP EPS was $0.87. Cash flow from operations was $1.69 billion. Feb 12, 2026: Arista reported Q4 2025 results. Revenue for 2025 was $9.006 billion, up 28.6%, and non-GAAP EPS was $2.98. The GAAP gross margin was 62.9% in Q4 2025, down from 64.6% in Q3 2025. Nov 4, 2025: Arista reported Q3 2025 results. Revenue was $2.308 billion, up 27.5%, and non-GAAP EPS was $0.75. Arista named Kenneth Duda President and Chief Technology Officer.