Arista Networks builds high-speed network switches — the traffic-control hardware that lets tens of thousands of servers inside a data center exchange data with each other — and sells them mainly to cloud and AI giants like Meta and Microsoft, collecting an ongoing subscription fee to keep maintaining that equipment.
How Arista makes money
Arista Networks designs high-speed network switches — the hardware equivalent of traffic-control equipment that lets tens of thousands of servers inside a data center exchange data with each other — and sells them mainly to cloud, AI, and large enterprise customers. It buys switching chips from Broadcom and outsources manufacturing to contractors like Jabil, Sanmina, and Foxconn, but designs both the hardware and its own EOS operating-system software in-house.
As Arista's installed base of switches grows, its recurring subscription revenue grows alongside it. Source: 10-K FY2025, Item 1 Business, p.7-8; MD&A revenue composition, p.52.
Where the revenue comes from
Arista reports as a single accounting segment, so customer type is the clearest way to break down its FY2025 revenue: cloud/AI giants (48%), general enterprise customers (32%), and AI/specialty service providers (20%). By product line, "Core" networking for AI/cloud/data centers made up 65% of revenue, "Cognitive Adjacencies" (campus and routing) 18%, and software/services 17%.
| Region | Share |
|---|---|
| Americas | 79.1% |
| Europe, Middle East & Africa | 11.9% |
| Asia-Pacific | 9.0% |
International revenue's share rose from 18.2% (FY2024) to 20.9% (FY2025) — most contracts are dollar-denominated, limiting currency risk, but tariff and export-control exposure is growing. Source: 10-K FY2025, p.52, 54.
Customers and competitors
Arista sells B2B and is heavily dependent on a small number of enormous customers — two customers individually exceeded 10% of revenue in each of the last three years. Combined, the top 2 customers made up 39% of revenue in 2023, dipped to 35% in 2024, then rose to 42% in 2025, the highest of the three years. The FY2024 10-K named these two customers as Meta Platforms and Microsoft; the FY2025 filing no longer discloses their names.
- Cisco Systems — the traditional powerhouse in data-center and campus networking, selling integrated, bundled hardware in contrast to Arista's more open, software-centric approach.
- Nvidia — pushes its own NVLink and InfiniBand interconnect technology for AI-server connections, threatening to displace the Ethernet-based switching that is Arista's core business, especially when bundled with its own GPUs.
- White-box vendors and in-house design — low-cost switch makers running open-source operating systems, plus the growing trend of large cloud and AI companies designing their own switches entirely in-house.
Source: 10-K FY2025, p.52 (customer concentration); Item 1 Business (Competition), p.8.
The metric that matters most in this sector
Deferred revenue (contract liabilities) — money customers have already committed or prepaid that Arista hasn't yet recognized as revenue — acts as a leading indicator of demand. If it grows faster than reported revenue, orders are already piling up for future recognition; if its growth stalls, that can be an early warning of a coming slowdown.
| FY2023 | FY2024 | FY2025 | |
|---|---|---|---|
| Deferred revenue | $1,506M | $2,791M | $5,372M |
| YoY growth | — | +85% | +93% |
Deferred revenue has grown faster than reported revenue in each of the last two years — a sign that demand, not just past results, continues to build.
Source: 10-K FY2025 balance sheet, p.68; 10-K FY2024 balance sheet (comparative figures).
Leadership and ownership
CEO Jayshree Ullal has led Arista since October 2008 (18 years), adding the Chairman title in December 2023; she previously ran Cisco's data-center and switching business as SVP, and owns 2.3% of shares. Co-founder Andy Bechtolsheim remains actively involved as Chief Development Officer and is the largest shareholder at 14.6% (about 183.8 million shares) through the Bechtolsheim Family Trust. BlackRock holds 5.9%. A founder who remains an active executive and the company's largest shareholder is a notable long-term-alignment signal.
Source: DEF 14A, filed Apr 16, 2026 — 5%+ shareholder table, executive and director bios.
Capital returns
Arista pays no dividend and has stated it has no plans to start one. It repurchased $1,603.1M of stock in FY2025 (15.9 million shares at an average $100.63) and $423.6M in FY2024 (5.5 million shares at an average $77.13), and approved a new $1.5B buyback program in May 2025.
Note: Arista completed a 4-for-1 stock split in December 2024; all dollar figures here are split-neutral totals. Source: 10-K FY2025, p.50, 87.
How this company could fail
- Customer concentration risk — just 2 customers made up 42% of FY2025 revenue. A shift in either customer's order timing or capital spending plans alone can meaningfully swing quarterly results.
- Competition and in-house design risk — Cisco, Huawei, and HPE (via its Juniper acquisition) compete as traditional rivals, white-box vendors compete on price, and Nvidia's own AI interconnect technology threatens to bypass Ethernet switching altogether. The biggest long-term threat may be hyperscale customers designing their own chips and switches in-house.
- Supply chain and geopolitical risk — switching chips come almost entirely from a single supplier, Broadcom, and contract manufacturing runs through Malaysia, Vietnam, and Mexico, directly exposing Arista to tariffs, export controls, and Taiwan-China tensions.
Source: 10-K FY2025, p.8 (competition), p.52 (customer concentration), Item 1A Risk Factors.
Five-year financials
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| Revenue | 2,948.0 | 4,381.3 | 5,860.2 | 7,003.1 | 9,005.7 |
| YoY growth | — | +48.6% | +33.8% | +19.5% | +28.6% |
| Operating income (margin) | 924.7 (31.4%) | 1,527.1 (34.9%) | 2,257.2 (38.5%) | 2,944.6 (42.0%) | 3,856.1 (42.8%) |
| Free cash flow | 951.2 | 448.2 | 1,999.6 | 3,676.2 | 4,252.4 |
| Interest-bearing debt | 0 | 0 | 0 | 0 | 0 |
FCF = operating cash flow minus capex. The most recent quarter (Q2 FY2026) grew revenue 37.7% year over year — faster than FY2025's full-year rate of 28.6%, suggesting AI data-center demand hasn't slowed. Source: 10-K FY2025 income statement p.69, cash flow statement p.72, balance sheet p.68; 10-K FY2023 (2021-2022 comparatives).
What we still don't know
- Whether the top 2 customers are still Meta and Microsoft can't be confirmed from the FY2025 10-K, which no longer names them (unlike the FY2024 filing) — recent earnings calls or IR materials would need to be checked.
- How fast and how deeply revenue would fall if big tech's AI capital spending slows isn't something historical results alone can show.
- How much Nvidia's NVLink and hyperscalers' self-designed switches are actually eating into Ethernet-switching share today is disclosed only as a qualitative risk factor, not with concrete market-share figures.
Frequently asked questions
How does Arista Networks make money?
Arista designs and sells high-speed network switches — hardware that routes data between tens of thousands of servers inside data centers — earning 84% of revenue from equipment sales and 16% from ongoing software/maintenance subscriptions tied to that installed base.
Who are Arista's biggest customers?
Cloud and AI giants make up 48% of revenue, with the top 2 customers alone accounting for 42% of FY2025 revenue. Meta and Microsoft were named as the top two customers in the FY2024 10-K, though the FY2025 filing no longer discloses their names.
What is Arista's market cap?
As of this article's data, Arista's market cap was about $246.8B, on FY2025 revenue of $9.01B.