Arista Networks (ANET) Plunges 4.87% on Mixed Earnings, Cautious Outlook

On May 7, 2025, Arista Networks experienced a 4.87% drop in pre-market trading, reflecting investor sentiment following the company's first-quarter earnings report released after Tuesday's closing bell.

Arista Networks reported quarterly earnings of 65 cents per share, surpassing the analyst consensus estimate of 60 cents. However, the company's revenue of $2 billion fell short of the $2.02 billion consensus estimate. The non-GAAP gross margin stood at 64.1%, slightly lower than the 64.2% reported in the fourth quarter of 2024. CEO Jayshree Ullal highlighted the company's continued growth and profitability, driven by AI, cloud, and enterprise customers, despite uncertainties around tariffs.

Arista Networks' outlook for the second quarter includes projected revenue of $2.1 billion, slightly below the $2.11 billion estimate. This cautious outlook, combined with the mixed earnings report, likely contributed to the stock's decline. Additionally, recent insider selling by company directors, including Giancarlo Charles H and Kelly Bodnar, may have further dampened investor confidence.