Arista Earnings Beat. Cloud Networking Leader Raises 2026 Outlook.

Arista Networks (ANET) reported fourth quarter earnings that topped Wall Street targets. Arista stock climbed in early trading on Friday amid raised 2026 revenue guidance, with artificial intelligence-related sales expected to double.

The maker of cloud computing network gear reported results after the market close on Thursday amid volatility in artificial intelligence stocks.

The company raised its 2026 revenue growth outlook by from 20% growth to 25% (approximately $11.25 billion).

“This significant increase is driven by strong AI demand, with management noting continued building of the company’s product deferred balance (which we estimate sits at roughly $3 billion),” said William Blair analyst Sebastien Naji in a report. “Despite memory pricing headwinds, the company reiterated its 2026 gross margin guide (63% at the midpoint), while lifting its non-GAAP operating margin guide by two percentage points to 46%.”

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Arista faces high expectations in 2026. And the raised sales outlook to 25% growth could push up expectations, said Raymond James analyst Simon Leopold in a report.

‘Buy Side’ Bogey

“Buy-side (institutional investor) bogeys have been 30% to 35%, and the (guidance) uptick might push these higher,” Leopold said in a report.

At an analyst day in September, Arista forecast 20% revenue growth in fiscal 2026 to $10.5 billion. It predicted that its AI networking revenue would grow 70% in 2026 to around $2.75 billion. Most of that was expected to come from “back end” Ethernet networking products that connect clusters of AI servers in cloud-computing data centers. Arista faces stiff competition from Nvidia (NVDA) in AI networking.

Arista on Thursday raised its 2026 AI networking revenue outlook to $3.25 billion from $2.75 billion. In Q4, total deferred revenue increased to $5.4 billion, up from $4.7 billion in the prior quarter,

On the stock market today, Arista stock climbed over 9% to near 148.

For the three months ended Dec. 31, Arista earnings rose 24% from a year earlier to 82 cents per share on an adjusted basis. Revenue jumped 29% to $2.49 billion.

Analysts estimated Arista earnings per share of 76 cents on an adjusted basis with revenue of $2.38 billion.

Arista Stock: Q1 Sales Guidance

For the current quarter ending March 31, Arista predicted revenue of $2.6 billion at the midpoint of guidance, versus estimates of $2.46 billion.

Arista sells computer network switches that speed up communications in internet data centers.

Also, Arista’s biggest customers are** Microsoft** (MSFT) and Facebook-parent Meta Platforms (META). In 2025, Microsoft accounted for 26% of sales and Meta 16%.

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“Management expressed confidence in the potential for up to two more over 10% customers in 2026,” said Citi analyst Atif Malik in a report.

Newer customers include Oracle (ORCL) and Google-parent** Alphabet** (GOOGL).

Arista stock gained 18% in 2025 but weakened in the back half of the year amid volatility in artificial intelligence plays. Arista stock hit a 52-week high of 164.94 on Oct. 30.

Heading into the Arista earnings report, shares were up about 4% in 2026. Shares fell in Thursday’s regular session after rival Cisco Systems (CSCO) lowered its profit margin outlook because of higher memory chip prices.

Arista’s chief rivals are Cisco and HPE Enterprises’ (HPE) Juniper unit. But one worry on Wall Street has been that Arista could be losing business to contract manufacturers such as Celestica (CLS).

ANET Stock Technical Ratings

According to analysts, Arista is gaining ground in the so-called “enterprise” market — large companies, government agencies and educational institutions.

Further, Arista is among AI stocks to watch.

Arista stock holds a Composite Rating of 90 out of a best-possible 99, according to IBD Stock Checkup. IBD’s Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.

Meanwhile, Arista stock holds an Accumulation/Distribution Rating of C-. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. (A+ signifies heavy institutional buying; E means heavy selling. Think of a C grade as neutral.)

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.

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