Arista Networks Posts 29% Revenue Growth, Raises Q1 Revenue Guide to $2.6B
Arista Networks reported adjusted Q4 EPS of $0.82 versus $0.76 expected and revenue of $2.49 billion, a 29% year-over-year increase, with non-GAAP operating margin at 47.5%. The company guided Q1 revenue to about $2.6 billion and maintained healthy margin expectations, prompting two firms to raise price targets to $185 and $175.
1. Fourth-Quarter Financial Results
Arista delivered adjusted EPS of $0.82 versus $0.76 expected and generated revenue of $2.49 billion, up 29% year-over-year. GAAP net income rose to $956 million from $801 million, non-GAAP net income topped $1 billion for the first time, and non-GAAP operating margin reached 47.5%.
2. Full-Year Performance
Full-year 2025 revenue reached $9 billion, driven by strong demand in AI networking and campus expansion. CEO Jayshree Ullal highlighted that the Arista 2.0 strategy validated growth across cloud and enterprise segments while profitability remained solid despite slight margin easing.
3. First-Quarter Guidance
For Q1 2026, the company guided revenue to about $2.6 billion, above consensus forecasts, and indicated that operating margins would stay healthy as AI and cloud demand continues to support network infrastructure investments.
4. Analyst Upgrades
Needham raised its price target to $185 with a Buy rating, citing stronger guidance and AI revenue forecast of $3.25 billion. Piper Sandler increased its target to $175, pointing to a 25% annual growth forecast, rising cloud and AI demand, and higher chip and memory purchase commitments to secure supply.