Live: Will Arista Networks Beat Q4 Earnings After the Bell?

Arista shares kept rising during the company’s call and here’s the key section to focus on:

“As we have moved through 2025, we have gained visibility and confidence for fiscal year 2026.

As Jayshree mentioned, we are now pleased to raise our 2026 fiscal year outlook to 25% revenue growth, delivering approximately $11.25 billion. We maintain our 2026 campus revenue goal of $1.25 billion and raised our AI centers goal from $2.75 billion to $3.25 billion. For gross margin, we reiterate the range for the fiscal year of 62% to 64% inclusive of mix and anticipated supply chain cost increases for memory and silicon. In terms of spending, we expect to continue to invest in innovation, sales and scaling the business to ensure our status as a leading pure-play networking company.

With our increased revenue guidance, we are now confident to raise the operating margin outlook to approximately 46% in 2026. On the cash front, we will continue to work to optimize our working capital investments with some expected variability in inventory due to the timing of component receipts on purchase commitments.

Our structural tax rate is expected at 21.5% back to the usual historical rate, up from the seasonally lower rate of 18.4% experienced last quarter Q4 ’25.”

Wall Street had expected revenue of $10.9 billion this year.

Arista’s conference call has begun, we’ll be tracking whether there’s any significant movements during it.

Arista’s Q4 results reveal strong execution across critical operational metrics investors should monitor.

Revenue Mix Strengthening

Product revenue hit $2.096 billion, up 30.3% year-over-year, while service revenue reached $392.1 million, growing 21.6%. This mix reflects healthy demand for both new deployments and recurring support contracts—customers are expanding existing infrastructure rather than simply replacing equipment.

Operating Leverage in Action

Adjusted operating income grew 30.1% to $1.181 billion, outpacing 29% revenue growth. CFO Chantelle Breithaupt highlighted: “Arista achieved a historic milestone: surpassing $1 billion in quarterly net income.” Operating expenses rose just 23%, demonstrating disciplined cost management even as R&D spending increased 22.2%.

Cash Generation Accelerates

Free cash flow jumped to $4.372 billion, up 17.9%, providing ammunition for continued investment in AI networking capabilities.

Cisco sold off today in part because of fears of gross margin erosion.

Arista’s earnings call for gross margins of 62% to 63% next quarter, which at the midpoint is below Wall Street expectations of 62.95%.

That’s a slight blemish investors appear willing to overlook as shares are up 8.2% after hours.

ANET | Arista Networks Q4’25 Earnings Highlights:

• Adj. EPS: $0.82 (Est. $0.76) [✅]; UP +24.24% YoY
• Revenue: $2.488B (Est. $2.39B); UP +28.9% YoY
• Adj. Gross Margin: 63.4% [✅]; DOWN -50 bps YoY
• Net Income: $955.8M  [✅]; UP +19.3% YoY

Q1’26 Outlook:

• Revenue: $2.6B [✅]
  • Expectations are driven by continued demand in AI networking and campus expansion.
  • Guidance reflects a strong exit rate from 2025, with anticipated growth in both product and service segments.

Q4 Segment Performance:

• Product Revenue: $2.096B  [✅]; UP +30.3% YoY
• Service Revenue: $392.1M [✅]; UP +21.6% YoY

Other Key Q4 Metrics:

• Adj. Operating Income: $1.181B [✅]; UP +30.1% YoY
• Adj. Operating Expenses: $530.9M [✅]; UP +23.0% YoY
• R&D Expenses: $348.4M [✅]; UP +22.2% YoY
• Free Cash Flow: $4.372B; UP +17.9% YoY
• Effective Tax Rate: 15.9% (vs. 9.9% YoY)
• Cash and Cash Equivalents: $1.964B
• Marketable Securities: $8.779B
• Inventories: $2.247B
• Accounts Receivable: $1.887B

CEO Commentary:

• Jayshree Ullal: “2025 was the year of validation of our Arista 2.0 momentum, as we hit the milestone of shipping a cumulative of 150 million ports. We exceeded both our AI networking and campus expansion goals, delivering profitable growth and revenue of $9 billion.”

CFO Commentary:

• Chantelle Breithaupt: “Our Q4 results underscore the strong operating leverage inherent in our model, providing a powerful exit rate as we head into 2026. By pairing 29% revenue growth with a disciplined 47.5% operating margin, Arista achieved a historic milestone: surpassing $1 billion in quarterly net income. Congratulations to the team.”

Arista’s share gains are off the highs, but still up about 5% as Wall Street digests their Q4 earnings.

Q1 guidance calls for revenue of $2.6 billion, which is above expectations of $2.46 billion.

These appear to be very strong earnings and shares are soaring, now up 8.5%.

Arista’s earnings were just released and here are the most need-to-know figures:

• EPS: $.82
• Revenue: $2.49 billion

As a reminder, here’s what Wall Street expected:

The stock’s initial movement is up around 2%. 

We expect that investors won’t have a long wait before Arista’s earnings hit the newswires. We’re expecting them at about 4:05 p.m. ET.

As a reminder, we’ll begin posting news and analysis the moment Arista’s earnings drop. To receive them, simply stay on this page and new updates will post automatically. 

Shares of Arista Networks are down 3.8% today following Cisco’s earnings last night.

While Cisco reported strong AI bookings, their guidance points to margin erosion from memory pricing. Wall Street was quick to sell off the report, and shares of Cisco are down 13% today.

We’ll see if the Street is more favorable to Arista tonight.