The earnings call reflects a strong performance by Arista Networks, with record revenue and operating income, increased growth targets, and strong contributions from AI and cloud sectors. However, challenges such as the loss of a key AI customer and increased operating expenses were noted. The sentiment remains positive due to the significant outweighing of highlights over lowlights.

Company Guidance -

Q3 2025

During the second quarter of 2025, Arista Networks reported a record revenue of $2.2 billion, surpassing their plan by $100 million. This growth was supported by strong contributions from software and service renewals, which accounted for 16.3% of revenue, and international sales, which made up 21.8% of the total. The company achieved a non-GAAP gross margin of 65.6%, benefiting from an efficient supply chain and minimal tariff impact. Arista raised its 2025 annual revenue growth target to 25%, aiming for $8.75 billion due to increased momentum in AI, cloud, and enterprise sectors. They also highlighted the strategic acquisition of VeloCloud to enhance their SD-WAN offerings and strengthen their presence with managed service providers. Their operating income for the quarter was $1.08 billion, with a net income of $923.5 million, resulting in a diluted earnings per share of $0.73. Looking ahead, Arista provided guidance for the third quarter of 2025, expecting revenue of approximately $2.25 billion and maintaining a strong focus on expanding their AI and cloud networking capabilities.

Record Revenue Achievement

Arista Networks achieved $2.2 billion in revenue for Q2 2025, surpassing the plan by $100 million and marking a year-over-year increase of 30.4%.

Raised Annual Growth Target

Arista Networks increased its 2025 annual growth target to 25%, now aiming for $8.75 billion in revenue, an incremental $550 million more than previously planned.

Strong Gross Margin Performance

The non-GAAP gross margin was 65.6%, above the guidance of 63%, driven by improved inventory management and supply chain efficiency.

Record Operating Income

Operating income for Q2 2025 was $1.08 billion, marking the first time Arista has crossed the $1 billion threshold in operating income.

Significant AI and Cloud Contributions

Arista's AI networking revenue is on track to exceed $1.5 billion in 2025, with significant contributions from large language models and AI accelerators.

Strategic Acquisition of VeloCloud

Arista announced the acquisition of SD-WAN leader VeloCloud to enhance its WAN portfolio, although it is not expected to be material in 2025.

Strong Cash Flow Generation

Arista generated approximately $1.2 billion in cash from operations in Q2 2025, the highest in the company's history.

Arista Networks (ANET) Earnings, Revenues Date & History

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ANET Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
Nov 03, 2025	2025 (Q3)	0.72 / -	0.6	―	―	―
Aug 05, 2025	2025 (Q2)	0.65 / 0.73	0.525	39.05% (+0.20)
May 06, 2025	2025 (Q1)	0.59 / 0.65	0.498	30.52% (+0.15)
Feb 18, 2025	2024 (Q4)	0.57 / 0.65	0.52	25.00% (+0.13)
Nov 07, 2024	2024 (Q3)	0.52 / 0.60	0.458	31.00% (+0.14)
Jul 30, 2024	2024 (Q2)	0.49 / 0.53	0.395	32.91% (+0.13)
May 07, 2024	2024 (Q1)	0.43 / 0.50	0.358	39.11% (+0.14)
Feb 12, 2024	2023 (Q4)	0.43 / 0.52	0.352	47.73% (+0.17)
Oct 30, 2023	2023 (Q3)	0.40 / 0.46	0.312	46.79% (+0.15)
Jul 31, 2023	2023 (Q2)	0.36 / 0.40	0.27	46.30% (+0.13)

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

ANET Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Aug 05, 2025	$118.12	$138.78	+17.49%
May 06, 2025	$90.77	$86.45	-4.76%
Feb 18, 2025	$111.06	$103.92	-6.43%
Nov 07, 2024	$107.76	$100.11	-7.10%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.