Arista Networks (ANET) Q4 2024 earnings summary

Executive summary

• Achieved record annual revenue of $7.0 billion in 2024, up 19.5% year-over-year, with strong growth in AI, cloud, data center, and campus networking, surpassing initial guidance and serving over 10,000 customers.

• Q4 2024 revenue reached $1.93 billion, a 25.3% increase year-over-year, with non-GAAP EPS of $0.65 post-split and 6.6% sequential growth.

• Achieved #1 market share in data center switching, with significant gains in high-speed switching against competitors.

• Introduced major innovations including new AI networking platforms, SWAG for campus networks, Wi-Fi 7 access points, and advanced network observability solutions.

• Celebrated 20th company anniversary and 10th IPO anniversary, surpassing 100 million ports installed and recognized for customer satisfaction and ESG leadership.

Financial highlights

• FY 2024 non-GAAP gross margin was 64.6% and operating margin was 47.5%; Q4 non-GAAP gross margin was 64.2% and operating margin was 47.0%.

• FY 2024 non-GAAP EPS grew 31.2% year-over-year to $2.27; Q4 non-GAAP EPS was $0.65, up 25% year-over-year.

• FY 2024 GAAP net income was $2.85 billion ($2.23/diluted share); Q4 GAAP net income was $801 million ($0.62/diluted share).

• Cash, equivalents, and marketable securities ended at $8.3 billion; operating cash flow for Q4 was $1 billion, with full-year cash from operations at ~$3.7 billion.

• Repurchased $424 million in stock during 2024; $921 million remains under the current buyback program.

Outlook and guidance

• FY 2025 revenue growth outlook raised to 17% (~$8.2 billion), with Q1 2025 revenue guidance of $1.93–$1.97 billion.

• FY 2025 gross margin expected at 60%–62%; Q1 2025 gross margin guided at ~63%.

• FY 2025 operating margin expected at 43%–44%; Q1 2025 non-GAAP operating margin at ~44%.

• Structural tax rate to normalize at 21.5% in 2025.

• Long-term market opportunity projected at $70 billion by 2028, with mid-teens CAGR from 2023–2026.