Arista Beats Q2 Earnings Estimates on Healthy Top-Line Growth

Arista Networks, Inc. ANET reported strong second-quarter 2025 results, with revenues and adjusted earnings soaring year over year, driven by robust demand trends. Innovative product launches and steady customer additions backed by the company’s best-in-class portfolio strength led to top-line expansion, while steady margin improvement contributed to earnings growth. Both the bottom and the top lines beat the respective Zacks Consensus Estimate.Net IncomeGAAP net income in the reported quarter improved to $888.8 million or 70 cents per share from $665.4 million or 52 cents per share in the year-ago quarter, propelled by higher revenues.On a non-GAAP basis, net income was $923.5 million or 73 cents per share compared with $672.6 million or 53 cents per share in the year-earlier quarter. The bottom line beat the Zacks Consensus Estimate by 8 cents.Arista Networks, Inc. Price, Consensus and EPS Surprise Arista Networks, Inc. price-consensus-eps-surprise-chart | Arista Networks, Inc. QuoteRevenuesRevenues surged to $2.2 billion from $1.69 billion in the prior-year quarter, driven by strength across the product portfolio. The company introduced various solutions for cloud, Internet service providers and enterprise networks to meet the rising demands of AI/ML-driven network architectures. These innovations enabled Arista to deliver a superior customer experience and increase customer engagement. The top line beat the consensus estimate of $2.11 billion. Net quarterly sales from Products totaled $1.88 billion compared with $1.42 billion in the year-ago quarter. Service revenues increased to $327.8 million from $267.1 million. Arista witnessed positive demand trends owing to its strong product portfolio, which is highly scalable, programmable and provides data-driven automation, analytics and world-class support services.Net sales from the Americas contributed 78.2% to total revenues, while international revenues accounted for the remainder. Driven by its relentless pursuit of innovative products, Arista maintains a strong leadership position in the Data Center and Cloud Networking vertical.Other DetailsNon-GAAP gross profit rose to $1.45 billion from $1.11 billion for respective margins of 65.6% and 65.4%. The margin was above the company’s guidance and was buoyed by improved inventory management and supply-chain discipline.Total operating expenses were $452.4 million, up from $397.6 million in the year-ago quarter. Research & development costs rose to $296.5 million from $267.5 million. Sales and marketing expenses also increased to $126.5 million from $104.4 million due to a rise in headcount, new product introduction costs and higher variable compensation expenditures. Operating income for the quarter reached a record high of $1.08 billion from $770.4 million.Cash Flow & LiquidityIn the first six months of 2025, Arista generated $1.84 billion of net cash from operating activities compared with $1.5 billion in the year-ago period. As of June 30, 2025, the company had $2.22 billion in cash and cash equivalents and $307.1 million in other long-term liabilities. During the quarter, the company repurchased $196 million worth of shares at an average price of $80.70 per share. Arista has $1.4 billion worth of shares available for repurchase under its $1.5 billion share buyback program.OutlookFor the third quarter of 2025, management expects revenues of approximately $2.25 billion owing to healthy growth momentum and solid demand trends. Non-GAAP gross margin is expected to be 64% and non-GAAP operating margin about 47%.Zacks RankArista currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Upcoming ReleasesKeysight Technologies, Inc. KEYS is scheduled to release third-quarter 2025 earnings on Aug. 19. The Zacks Consensus Estimate for earnings is pegged at $1.67 per share, suggesting a growth of 6.4% from the year-ago reported figure.Keysight has a long-term earnings growth expectation of 12%. Keysight delivered an average earnings surprise of 8.2% in the last four reported quarters.Akamai Technologies, Inc. AKAM is slated to release second-quarter 2025 earnings on Aug. 7. The Zacks Consensus Estimate for earnings is pegged at $1.55 per share, indicating a 1.9% decline from the year-ago reported figure.Akamai has a long-term earnings growth expectation of 8%. Akamai delivered an average earnings surprise of 4.8% in the last four reported quarters.Pinterest, Inc. PINS is set to release second-quarter 2025 earnings on Aug. 7. The Zacks Consensus Estimate for earnings is pegged at 34 cents per share, implying a growth of 17.2% from the year-ago reported figure.Pinterest has a long-term earnings growth expectation of 33.3%. Pinterest delivered an average earnings surprise of 0.5% in the last four reported quarters.Zacks' Research Chief Picks Stock Most Likely to "At Least Double"Our experts have revealed their Top 5 recommendations with money-doubling potential – and Director of Research Sheraz Mian believes one is superior to the others. Of course, all our picks aren’t winners but this one could far surpass earlier recommendations like Hims & Hers Health, which shot up +209%.See Our Top Stock to Double (Plus 4 Runners Up) >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Akamai Technologies, Inc. (AKAM): Free Stock Analysis Report Arista Networks, Inc. (ANET): Free Stock Analysis Report Keysight Technologies Inc. (KEYS): Free Stock Analysis Report Pinterest, Inc. (PINS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks