NEW YORK - Arista Networks , Inc. (NYSE:ANET) reported third-quarter earnings that surpassed analyst expectations, but its stock tumbled 10% in after-hours trading. The company also announced a four-for-one stock split.
The networking solutions provider posted adjusted earnings per share of $2.40, beating the analyst estimate of $2.08. Revenue for the quarter came in at $1.81 billion, exceeding the consensus estimate of $1.75 billion and representing a 20% increase YoY.
Despite the strong results, Arista's shares fell sharply following the announcement. The company's fourth-quarter revenue guidance of $1.85-1.9 billion, while above the consensus of $1.815 billion, may not have met some investors' higher expectations.
Jayshree Ullal, Chairperson and CEO of Arista Networks, commented, "Arista remains at the forefront of next generation centers of data across client-to-cloud and AI focused locations. Our Q3 2024 results once again demonstrate our continued commitment to customer priorities as well as delivering strong financial results."
The company's gross margin slightly declined to 64.6% on a non-GAAP basis, compared to 65.4% in the previous quarter but improved from 63.1% in the same quarter last year.
Arista also announced a four-for-one stock split, effective December 3, 2024, aimed at making its shares more accessible to a broader base of investors.
For the fourth quarter, Arista expects non-GAAP gross margin of approximately 63% - 64% and non-GAAP operating margin of approximately 44%.
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