Arista Networks Inc
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+ FollowMarket Cap$249.15B
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Earnings Call Q3 2026
November 3, 2026 - AI Summary
Q3 2026 results: record momentum + margin strength
- Revenue $3.66B, +58.5% YoY, beating guidance (above $3.3B).
- Operating margin ~49.1% (operating income $1.8B), gross margin 64% (down from 65.2% YoY, but up from 63.4% QoQ).
- Profitability: net income $1.53B (+~55.8% EPS YoY to $1.20).
- International revenue $682.5M (18.6% of total), down from 23% last quarter due to mix shift to large global customers (still double-digit YoY growth in all regions).
Balance sheet / cash / working capital: strong cash generation but inventory build
- Cash/cash equivalents/marketable securities: ~$14.4B (up from $13.3B).
- Cash from operations ~ $1.2B; DSOs 59 days (down from 68 days).
- Inventory increased to $3.2B (from $2.5B in Q2) due to an “intentional inventory build” to support demand—inventory turns fell to 1.6 (from 1.7). Management warned inventory fluctuations may continue and can affect near-term cash timing.
- Purchase commitments $11.4B (up from $9.7B), largely tied to chips for new products/AI deployments.
- Deferred revenue ~$6.8B, down slightly QoQ; management emphasized it can be volatile and tied to acceptance clauses/ramp dynamics.
Guidance raised materially (important positive): Q4 2026 and FY2027
- Q4 2026 revenue forecast: $3.9B–$4.0B → implies FY2026 revenue just over $13.3B at the midpoint (they explicitly said guidance increased the 4th time in 2026).
- Q4 gross margin: 63%–64%, operating margin: 48%–49%, EPS $1.26–$1.30.
- FY2027 revenue growth: 38%–40% to about $18.5B at midpoint.
- FY2027 profitability outlook: gross margin 62%–64%, operating margin ~49%, effective tax rate ~21%.
- AI fabrics expected fastest-growing, targeting ~$7B in AI fabrics in 2027; cognitive campus ~60% growth to ~$2B.
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$72.46
63.3% downside
Current Fair Value
63.3% downsideOvervalued by 63.3% based on the discounted cash flow analysis.
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Share Statistics
| Market cap | $249.15 Billion |
|---|---|
| Enterprise Value | $246.86 Billion |
| Earnings per Share | $2.79 |
| Beta | 1.62 |
| Outstanding Shares | 1,262,200,000 |
Return
| Return on Equity | 28.89% |
|---|---|
| Return on Assets | 18.81% |
| Return on Invested Capital | 28.66% |
Valuation & Multiples
| P/E Ratio | 45.31 |
|---|---|
| PEG | 54.63 |
| Price to Sales | 21.93 |
| Price to Book Ratio | 15.18 |
| Enterprise Value to Revenue | -0.17 |
| Enterprise Value to EBIT | -0.38 |
| Enterprise Value to Net Income | 51 |
| Total Debt to Enterprise | 0 |
| Debt to Equity | 0 |
Revenue Sources
No data
Last Earnings Call
Report Date
November 3, 2026
EPS
$1.20
Est. $1.08Revenue
$3.66 B
Est. $3.33 BNext Earnings Call
Expected Date
February 11, 2027
EPS Estimate
$1.29
Consensus analyst estimateRevenue Estimate
$3.97 B
Consensus analyst estimateInstitutional Put/Call Ratio
Compares institutional put options with call options. At 0.80, the ratio is below 1, so institutions hold more calls than puts.
| Put/Call Ratio | 0.8036▼ 32.52% |
|---|---|
| Total Calls | 345,300▼ 96.84% |
| Total Puts | 277,500▼ 97.75% |
Institutional Ownership
Holdings and activity of institutional investors.
| Ownership % | 11.12%▼ 60.96% |
|---|---|
| Total Invested | $28.46B▼ 81.49% |
| Investors Holding | 1,365▼ 998.00% |
About Arista Networks Inc
2,300 employees
CEO: Jayshree Ullal
Arista Networks is an industry leader in software-driven cloud networking solutions for large data center and campus environments. Arista's award-winning platforms deliver availability, agility, automation analytics and security through ...