Arista Networks (ANET) Q4 2025 earnings summary

Executive summary

• Achieved record annual revenue of $9.01 billion in 2025, up 28.6% year-over-year, with Q4 revenue of $2.49 billion, up 28.9% year-over-year, driven by strong AI and cloud demand and next-generation networking platforms.

• Surpassed 150 million cumulative ports shipped and expanded international revenue by over 40% in Asia and Europe.

• Cloud and AI titans contributed 48–65% of 2025 revenue, enterprise and financials 18–32%, and AI/specialty providers 17–20%.

• Two customers accounted for more than 10% each of total revenue, with expectations for further diversification in 2026.

• Launched new products and initiatives, including the 7800 R4 spine, Blue Box diagnostics, and completed the VeloCloud acquisition.

Financial highlights

• Q4 2025 revenue was $2.49 billion, up 28.9% year-over-year and above guidance.

• Non-GAAP gross margin for 2025 was 64.6%; Q4 gross margin was 63.4%, slightly above guidance but down from 64.2% last year due to higher cloud/AI mix.

• Q4 operating income was $1.2 billion (47.5% of revenue); FY 2025 operating income was $4.3 billion (48.2% of revenue).

• Q4 net income reached $1.05 billion (42% of revenue), with diluted EPS of $0.82, up 24.2% year-over-year.

• Cash and equivalents at year-end totaled $10.74 billion; $1.6 billion in stock repurchases during 2025.

Outlook and guidance

• 2026 revenue guidance raised to $11.25 billion, representing 25% annual growth.

• Q1 2026 revenue expected at $2.6 billion, with gross margin 62%-63% and operating margin ~46%.

• AI networking revenue goal increased to $3.25 billion for 2026; campus revenue goal maintained at $1.25 billion.

• Gross margin guidance for 2026 remains at 62%-64%, despite memory and silicon cost pressures.

• Operating margin outlook for 2026 raised to ~46%; structural tax rate expected at 21.5%.