We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Arista Q1 Earnings Top Estimates on Healthy Y/Y Revenue Growth
Read MoreHide Full Article
Key Takeaways
Arista Q1 revenues jumped 35.1% to $2.71B, beating estimates on AI and cloud demand.
ANET witnessed strong product growth from high-speed networking and enterprise, plus rising service revenues.
Arista expects Q2 revenues near $2.8B with steady margins and EPS around 88 cents per share.
Arista Networks, Inc. (ANET - Free Report) reported strong first-quarter 2026 results with both adjusted earnings and revenues beating the Zacks Consensus Estimate.
The company posted a solid 35.1% year-over-year increase in revenues, driven by higher demand for artificial intelligence (AI) infrastructure, growth in high-speed networking, expansion in enterprise and data center markets, and continued product innovation.
Net Income
GAAP net income in the reported quarter increased to $1.02 billion or 80 cents per share from $813.8 million or 64 cents per share in the year-ago quarter, driven by higher revenues.
On a non-GAAP basis, net income was $1.11 billion or 87 cents per share compared with $845.9 million or 66 cents per share in the year-earlier quarter. The bottom line beat the Zacks Consensus Estimate by 6 cents.
Arista Networks, Inc. Price, Consensus and EPS Surprise
Quarterly revenues increased to $2.71 billion from $2 billion in the prior-year quarter, mainly due to solid growth in both Product and Service segments. The top line beat the consensus estimate of $2.62 billion.
Net quarterly sales from Products totaled $2.31 billion compared with $1.69 billion in the year-ago quarter, driven by strong demand for high-speed cloud and AI networking solutions and customer wins across enterprise and service provider markets.
Service revenues increased to $397.7 million from $312.3 million, supported by increased adoption of support contracts, software subscriptions and maintenance services.
Other Details
Non-GAAP gross profit rose to $1.69 billion from $1.28 billion for respective margins of 62.4% and 64.1%. Total operating expenses were $519 million, up from $417.3 million in the year-ago quarter. Research & development costs rose to $343.7 million from $266.4 million. Sales and marketing expenses also increased to $141.6 million from $116.6 million. Non-GAAP operating income for the quarter increased to $1.29 billion from $957.4 million, with respective margins of 47.8% each.
Cash Flow & Liquidity
In the first quarter, Arista generated $1.69 billion of net cash from operating activities compared with $641.7 million in the year-earlier quarter. As of March 31, 2026, the company had $2.79 billion in cash and cash equivalents and $320.1 million in other long-term liabilities. Arista has $817.9 billion worth of shares available for repurchase under its $1.5 billion share buyback program.
Outlook
For the second quarter of 2026, management expects revenues to be approximately $2.8 billion, driven by healthy growth momentum and solid demand trends. Non-GAAP operating margin is expected to be 46-47%, and non-GAAP earnings are expected to be around 88 cents per share.
HubSpot, Inc. (HUBS - Free Report) is scheduled to release first-quarter 2026 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at $2.47 per share, suggesting growth of 38.76% from the year-ago reported figure.
HubSpot has a long-term earnings growth expectation of 20%. The company delivered an average earnings surprise of 3.01% in the last four reported quarters.
Workday, Inc. (WDAY - Free Report) is set to release first-quarter fiscal 2027 earnings on May 21. The Zacks Consensus Estimate for earnings is pegged at $2.49 per share, implying growth of 11.7% from the year-ago reported figure.
Workday has a long-term earnings growth expectation of 20.16%. The company delivered an average earnings surprise of 8.53% in the last four reported quarters.
Motorola Solutions, Inc. (MSI - Free Report) is set to release first-quarter 2026 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at $3.25 per share, implying growth of 2.2% from the year-ago reported figure.
Motorola has a long-term earnings growth expectation of 9.4%. The company delivered an average earnings surprise of 5.66% in the last four reported quarters.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Arista Q1 Earnings Top Estimates on Healthy Y/Y Revenue Growth
Key Takeaways
Arista Networks, Inc. (ANET - Free Report) reported strong first-quarter 2026 results with both adjusted earnings and revenues beating the Zacks Consensus Estimate.
The company posted a solid 35.1% year-over-year increase in revenues, driven by higher demand for artificial intelligence (AI) infrastructure, growth in high-speed networking, expansion in enterprise and data center markets, and continued product innovation.
Net Income
GAAP net income in the reported quarter increased to $1.02 billion or 80 cents per share from $813.8 million or 64 cents per share in the year-ago quarter, driven by higher revenues.
On a non-GAAP basis, net income was $1.11 billion or 87 cents per share compared with $845.9 million or 66 cents per share in the year-earlier quarter. The bottom line beat the Zacks Consensus Estimate by 6 cents.
Arista Networks, Inc. Price, Consensus and EPS Surprise
Arista Networks, Inc. price-consensus-eps-surprise-chart | Arista Networks, Inc. Quote
Revenues
Quarterly revenues increased to $2.71 billion from $2 billion in the prior-year quarter, mainly due to solid growth in both Product and Service segments. The top line beat the consensus estimate of $2.62 billion.
Net quarterly sales from Products totaled $2.31 billion compared with $1.69 billion in the year-ago quarter, driven by strong demand for high-speed cloud and AI networking solutions and customer wins across enterprise and service provider markets.
Service revenues increased to $397.7 million from $312.3 million, supported by increased adoption of support contracts, software subscriptions and maintenance services.
Other Details
Non-GAAP gross profit rose to $1.69 billion from $1.28 billion for respective margins of 62.4% and 64.1%. Total operating expenses were $519 million, up from $417.3 million in the year-ago quarter. Research & development costs rose to $343.7 million from $266.4 million. Sales and marketing expenses also increased to $141.6 million from $116.6 million. Non-GAAP operating income for the quarter increased to $1.29 billion from $957.4 million, with respective margins of 47.8% each.
Cash Flow & Liquidity
In the first quarter, Arista generated $1.69 billion of net cash from operating activities compared with $641.7 million in the year-earlier quarter. As of March 31, 2026, the company had $2.79 billion in cash and cash equivalents and $320.1 million in other long-term liabilities. Arista has $817.9 billion worth of shares available for repurchase under its $1.5 billion share buyback program.
Outlook
For the second quarter of 2026, management expects revenues to be approximately $2.8 billion, driven by healthy growth momentum and solid demand trends. Non-GAAP operating margin is expected to be 46-47%, and non-GAAP earnings are expected to be around 88 cents per share.
Zacks Rank
Arista currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
HubSpot, Inc. (HUBS - Free Report) is scheduled to release first-quarter 2026 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at $2.47 per share, suggesting growth of 38.76% from the year-ago reported figure.
HubSpot has a long-term earnings growth expectation of 20%. The company delivered an average earnings surprise of 3.01% in the last four reported quarters.
Workday, Inc. (WDAY - Free Report) is set to release first-quarter fiscal 2027 earnings on May 21. The Zacks Consensus Estimate for earnings is pegged at $2.49 per share, implying growth of 11.7% from the year-ago reported figure.
Workday has a long-term earnings growth expectation of 20.16%. The company delivered an average earnings surprise of 8.53% in the last four reported quarters.
Motorola Solutions, Inc. (MSI - Free Report) is set to release first-quarter 2026 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at $3.25 per share, implying growth of 2.2% from the year-ago reported figure.
Motorola has a long-term earnings growth expectation of 9.4%. The company delivered an average earnings surprise of 5.66% in the last four reported quarters.