The networking gear maker beat second-quarter expectations and raised its 2026 outlook again as AI networking demand, international sales and long-term purchase commitments expanded.
Arista Networks forecast third-quarter revenue of about $3.3 billion and adjusted earnings per share of $1.06 to $1.08, both above Wall Street expectations, after second-quarter results topped estimates and marked the company's first quarter with revenue above $3 billion. Revenue rose 37.7% year over year to a record $3.04 billion, while adjusted earnings came in at $1.02 per share, ahead of consensus estimates. The company also raised its full-year 2026 revenue outlook for the third time to $12.6 billion from $11.5 billion, while maintaining gross margin guidance of 62% to 64% and lifting its operating margin outlook to 48% to 49%. Arista said demand for AI networking products continued to accelerate, with its EtherLynx switching platform deployed by more than 100 cumulative customers and multi-year purchase commitments rising to about $9.7 billion from $3.6 billion a year earlier, largely tied to chip procurement for AI deployments and new products. International revenue climbed to $697.8 million, or 23% of total revenue, deferred revenue increased to $6.9 billion, and the company ended the quarter with $13.3 billion in cash, cash equivalents and marketable securities. Shares were up 14.86% at $218.82 in Wednesday premarket trading, reaching a new 52-week high.