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{\"0\":\"High-performance networking leader hits new highs after a strong earnings beat.\",\"1\":\"Raised full-year outlook as AI and cloud demand fuel record revenue growth.\",\"2\":\"Analysts boost estimates and targets, expecting momentum to continue into 2026.\"}
Arista Networks (ANET - Free Report) , a Zacks Rank #1 (Strong Buy), builds high-performance networking gear and software for the world’s biggest data centers, cloud providers, and enterprises.
The stock surged to fresh all-time highs after strong earnings, as both analysts and investors see the momentum carrying through year-end.
About the Company
The Santa Clara, California–based company has been an innovator in networking standards, co-authoring the VXLAN protocol (a key technology for virtualized and multi-tenant data centers) and expanding it into advanced routing and integration capabilities. Its bread and butter is ultra-fast Ethernet switches and routers, which are designed for modern workloads like AI, big data, and large-scale cloud computing.
Its customers span five main verticals: cloud titans (hyperscalers with over a million servers), cloud specialists, service providers, financial services, and the broader enterprise sector. That includes six of the world’s largest cloud providers. Arista sells through a mix of direct sales, resellers, system integrators, and OEM partners, and it backs its gear with comprehensive support, upgrades, and repair services.
ANET is valued at $177 billion and has a Forward PE of 50. The stock has Zacks Style Scores of “B” in Growth and Momentum, but a “F” in Value.
Q2 Earnings Beat and Upside Guidance
Arista Networks delivered a strong Q2, beating earnings expectations by 12%. EPS came in at $0.73 beating the $0.65, while revenue was $2.20 billion, topping expectations of $2.11 billion.
Non-GAAP gross margin rose to 65.6% from 65.4% a year ago, and operating margin expanded to 48.4% from 46.5%, marking the company’s first quarter with more than $1 billion in non-GAAP operating income.
Management cited broad-based momentum across AI, cloud, and enterprise markets, with record enterprise and campus demand in a $25–30 billion TAM and renewed cloud upgrades driven by AI-fueled traffic diversity.
Arista raised its FY25 revenue forecast to $8.75 billion, up 25% year-over-year and $550 million above its prior outlook, and expects AI networking revenue to exceed $1.5 billion next year. The company also sees back-end AI networking reaching $750 million in 2025, up from near zero in 2022, with full AI strategy details coming at September’s Analyst Day.
Management reaffirmed its Arista 2.0 roadmap to hit $10 billion in revenue by 2026, two years ahead of schedule, driven by customer adoption, product innovation, and operational discipline.
Estimates Mixed
Since the company reported earnings, analysts have been raising estimates across the board.
For the current quarter, numbers have been taken from $0.66 to $0.71 over the last 7 days, or 8%. For the current year, analysts have lifted estimates 6%, going from $2.64 to $2.81.
Looking at next year, the trend continues. Over the last month analysts have lifted their numbers from $2.94 to $3.18, or 8%.
With those estimates going higher, many analysts are lifting their targets:
-Barclays reiterated ANET with Underweight, but lifted their target to $151 from $119.
-Goldman Sachs reiterated ANET with Buy, putting their price target at $155, up from $115.
-JPMorgan Chase reiterated ANET as an Overweight with a price target of $150, up from $130.
The Technical Take
The stock just hit all-time highs after earnings and is starting to slide a bit. Investors should be watching for support levels as there are Fibonacci 161.8% extension targets at $185.
Let us look at some moving averages for possible entry points:
21-day moving average: $122.20
50-day MA: $108.50
200-day MA: $100
In Summary
With record earnings momentum, rising analyst estimates, and a leadership position in high-speed networking for AI and cloud, Arista is showing no signs of slowing down.
The company’s ambitious roadmap, expanding TAM, and accelerating demand from both hyperscalers and enterprises make ANET a compelling growth story into 2025 and beyond.
For investors looking for exposure to the infrastructure backbone of AI and cloud computing, this Zacks Rank #1 stock may have plenty of runway left.
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Bull of the Day: Arista Networks (ANET)
Key Takeaways
Arista Networks (ANET - Free Report) , a Zacks Rank #1 (Strong Buy), builds high-performance networking gear and software for the world’s biggest data centers, cloud providers, and enterprises.
The stock surged to fresh all-time highs after strong earnings, as both analysts and investors see the momentum carrying through year-end.
About the Company
The Santa Clara, California–based company has been an innovator in networking standards, co-authoring the VXLAN protocol (a key technology for virtualized and multi-tenant data centers) and expanding it into advanced routing and integration capabilities. Its bread and butter is ultra-fast Ethernet switches and routers, which are designed for modern workloads like AI, big data, and large-scale cloud computing.
Its customers span five main verticals: cloud titans (hyperscalers with over a million servers), cloud specialists, service providers, financial services, and the broader enterprise sector. That includes six of the world’s largest cloud providers. Arista sells through a mix of direct sales, resellers, system integrators, and OEM partners, and it backs its gear with comprehensive support, upgrades, and repair services.
ANET is valued at $177 billion and has a Forward PE of 50. The stock has Zacks Style Scores of “B” in Growth and Momentum, but a “F” in Value.
Q2 Earnings Beat and Upside Guidance
Arista Networks delivered a strong Q2, beating earnings expectations by 12%. EPS came in at $0.73 beating the $0.65, while revenue was $2.20 billion, topping expectations of $2.11 billion.
Non-GAAP gross margin rose to 65.6% from 65.4% a year ago, and operating margin expanded to 48.4% from 46.5%, marking the company’s first quarter with more than $1 billion in non-GAAP operating income.
Management cited broad-based momentum across AI, cloud, and enterprise markets, with record enterprise and campus demand in a $25–30 billion TAM and renewed cloud upgrades driven by AI-fueled traffic diversity.
Arista raised its FY25 revenue forecast to $8.75 billion, up 25% year-over-year and $550 million above its prior outlook, and expects AI networking revenue to exceed $1.5 billion next year. The company also sees back-end AI networking reaching $750 million in 2025, up from near zero in 2022, with full AI strategy details coming at September’s Analyst Day.
Management reaffirmed its Arista 2.0 roadmap to hit $10 billion in revenue by 2026, two years ahead of schedule, driven by customer adoption, product innovation, and operational discipline.
Estimates Mixed
Since the company reported earnings, analysts have been raising estimates across the board.
For the current quarter, numbers have been taken from $0.66 to $0.71 over the last 7 days, or 8%. For the current year, analysts have lifted estimates 6%, going from $2.64 to $2.81.
Looking at next year, the trend continues. Over the last month analysts have lifted their numbers from $2.94 to $3.18, or 8%.
Arista Networks, Inc. Price and Consensus
Arista Networks, Inc. price-consensus-chart | Arista Networks, Inc. Quote
With those estimates going higher, many analysts are lifting their targets:
-Barclays reiterated ANET with Underweight, but lifted their target to $151 from $119.
-Goldman Sachs reiterated ANET with Buy, putting their price target at $155, up from $115.
-JPMorgan Chase reiterated ANET as an Overweight with a price target of $150, up from $130.
The Technical Take
The stock just hit all-time highs after earnings and is starting to slide a bit. Investors should be watching for support levels as there are Fibonacci 161.8% extension targets at $185.
Let us look at some moving averages for possible entry points:
21-day moving average: $122.20
50-day MA: $108.50
200-day MA: $100
In Summary
With record earnings momentum, rising analyst estimates, and a leadership position in high-speed networking for AI and cloud, Arista is showing no signs of slowing down.
The company’s ambitious roadmap, expanding TAM, and accelerating demand from both hyperscalers and enterprises make ANET a compelling growth story into 2025 and beyond.
For investors looking for exposure to the infrastructure backbone of AI and cloud computing, this Zacks Rank #1 stock may have plenty of runway left.