Arista Networks (ANET) announced impressive third-quarter earnings and revenue that exceeded analyst expectations. This announcement comes at a time when investors are concerned about the capital spending plans of key customers for 2024. The positive Q3 results caused a rise in ANET stock.
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The manufacturer of cloud computing network gear revealed its financial results after the close of the market on Monday.
For the three-month period ending on September 30, Arista’s earnings per share surged by 46% to $1.83. Additionally, revenue increased by 28% to $1.51 billion.
Analysts had estimated earnings per share of $1.58 on revenue of $1.48 billion. In the same period last year, Arista’s earnings per share were $1.25 on revenue of $1.18 billion.
Sales Guidance For ANET Stock
For the current quarter ending on December 31, Arista has forecasted revenue in the range of $1.50 billion to $1.55 billion, which surpasses the estimated $1.47 billion.
In after-hours trading, ANET stock climbed 5.6% to approximately 185.
Furthermore, Arista’s major customers include Microsoft (MSFT) and Facebook-parent Meta Platforms (META). Last week, Arista’s stock declined as a result of Meta’s Q3 earnings report and its initial guidance on 2024 capital spending.
Prior to the earnings report, ANET stock had already gained nearly 45% in 2023.
Arista specializes in selling computer network switches that enhance communication in internet data centers. Its primary competitors are Cisco Systems (CSCO) and Juniper Networks (JNPR).
According to industry analysts, Arista is making strides in the “enterprise” market, which consists of large corporations, government agencies, and educational institutions.
By 2025, some analysts predict that ANET stock will benefit from increased customer investments in artificial intelligence. Internet data centers will require additional computing power and network bandwidth to handle AI workloads.
Follow Reinhardt Krause on X, formerly known as Twitter, @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity, and cloud computing.
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