Arista Networks (ANET) Stock Forecast & Price Target

Arista Networks experienced a robust revenue increase of 20% in full year 2024, reaching $7.0 billion, primarily driven by heightened capital expenditures from Cloud and AI Titans and continued market share gains in key segments. The company reported that its largest customers, including Oracle, contributed nearly 48% of total revenues, demonstrating strong demand in the Cloud market. Looking ahead, management anticipates a revenue growth of approximately 17% year-over-year for FY25, supported by a favorable outlook for Cloud and AI clients, which bodes well for the company's future financial performance.

Arista Networks has experienced a decline in key revenue segments, with Enterprise and Financials contributing only 35% to 2024 sales, down from 36% the previous year, and Providers, which include significant clients like Apple, decreasing from 21% to 17%. The firm also reported a concerning slowdown in product billings, decelerating to 20%, coupled with an overall decrease in international revenue by 9% year-over-year, signaling potential vulnerabilities in growth prospects. Additionally, uncertainties surrounding the potential loss of Meta as a customer amid competitive pressures raise further concerns about the company’s market position and its ability to maintain the premium valuation it has historically enjoyed.