Big increase after the market! Arista Networks (ANET.US)'s ability to increase revenue and profit in Q3 was the best in history, and Q4 performance guidelines exceeded expectations

The Zhitong Finance App learned that after the US stock market on Tuesday, Arista Networks (ANET.US) released its results for the third quarter of 2026 up to September 30: revenue of US$36.576 billion, up 20.5% month-on-month and 58.5% year-on-year, the highest quarterly year-on-year growth rate since listing in 2014, exceeding the company's US$3.3 billion guideline by 10.8%, and surpassing analysts' unanimous expectations (US$3.334 billion) by nearly 10%.

On the profit side, non-GAAP diluted earnings of $1.20 per share surpassed the consensus forecast (approximately $1.08) of $0.12, up 55.8% year over year; GAAP diluted earnings per share of $1.22, up 82.1% year over year. GAAP earnings per share for the quarter were higher than the non-GAAP level, mainly due to GAAP results including $134.5 million in strategic investment income (excluding GAAP), and net other income increased from US$989 million in the same period last year to US$273.1 million — the measurement of operating quality should be based on the non-GAAP line. The non-GAAP operating margin was 49.1%, up 0.5 percentage points year over year; the non-GAAP gross margin was 64.0%, down 1.2 percentage points year over year.

Guidelines are the biggest highlight of the season. The company expects fourth quarter revenue of $3.9 billion to $40 billion, higher than market expectations of about $3.6 billion; non-GAAP diluted earnings per share of $1.26 to $1.30, higher than the forecast of approximately $1.15; non-GAAP operating margin of 48% to 49%. The cumulative revenue for the previous three quarters of US$9.402 billion is estimated by compounding the total revenue of US$13.3 billion to US$13.4 billion for the full year of 2026.

The balance sheet revealed an expansion in inventory preparation: inventory increased 42.8% from the beginning of the year to US$3.210 billion, total deferred revenue (including non-current) increased 27.3% to US$6.840 billion, and total cash and marketable securities of US$14.359 billion.

Chairman and CEO Jayshree Ullal said that this quarter's revenue growth rate and profitability all hit records since listing; CFO Chantelle Breithaupt called revenue, net profit, and earnings per share “three new highs.” On the product side, the company teamed up with AMD, Arm, Broadcom, Meta, Microsoft, and Qualcomm to launch a rack-level AI network architecture based on open Ethernet standards. A single rack supports 144 accelerators and can be expanded to 1024 XPUs across racks; in September, the company was included in the S&P 100 index.

After the announcement of the results, as of press release, the company's after-hours stock price rose 12.36%.