Why Arista Networks Stock Plummeted Today
Key Points
Arista beat Wall Street's sales and earnings targets for the first quarter.
Shares pulled back in response to forward guidance and supply constraints.
- 10 stocks we like better than Arista Networks ›
Arista Networks (NYSE: ANET) stock tumbled on Wednesday following the company's latest quarterly report. The networking hardware and software specialist's share price ended the daily session down 13.6% and had been off as much as 17.4% earlier in trading.
Arista published its Q1 results after the market closed yesterday and actually reported sales and earnings that beat the average Wall Street analyst forecasts. Despite the beats, the stock still got hit with a double-digit pullback today.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: Getty Images.
Arista Networks Q1 print was encouraging
Arista recorded non-GAAP (adjusted) earnings per share of $0.87 and sales of $2.71 billion in the first quarter. The results came in significantly ahead of the average analyst estimate, which had called for adjusted earnings per share of $0.81 on revenue of $2.62 billion.
Thanks in part to AI-related demand, Arista saw revenue increase roughly 35% year over year in Q1. Meanwhile, adjusted earnings per share were up roughly 32% year over year.
Arista's guidance wasn't enough for investors
With its Q1 report, Arista issued guidance for sales of roughly $2.8 billion in the current quarter. While the forecast narrowly exceeded the average Wall Street estimate's call for sales of $2.78 billion in the period, some investors were looking for stronger guidance. Adding another bearish catalyst, Arista is seeing some supply constraints that are creating headwinds for near-term performance. While the stock saw a substantial pullback today, the business's quarterly results were actually quite strong -- and the post-earnings pullback could be an overreaction to near-term headwinds.
Should you buy stock in Arista Networks right now?
Before you buy stock in Arista Networks, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Arista Networks wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $473,985!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,204,650!*
Now, it’s worth noting Stock Advisor’s total average return is 950% — a market-crushing outperformance compared to 203% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of May 6, 2026.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Arista Networks. The Motley Fool has a disclosure policy.
Recommended Articles
