Is Disappointment In Store For Arista (ANET) In Q2 Earnings?
Zacks Investment Research | Jul 29, 2019 09:19PM ET
Arista Networks, Inc. (NYSE:ANET) is scheduled to report second-quarter 2019 results after the closing bell on Aug 1. In the last reported quarter, the company delivered a positive earnings surprise of 11.6%. Notably, Arista surpassed the Zacks Consensus Estimate for earnings in each of the last four quarters, the average beat being 12%.
For the second quarter, the company is likely to report higher consolidated revenues on a year-over-year basis driven by healthy growth dynamics.
Factors to Consider
Arista continues to benefit from the expanding cloud networking market owing to strong demand for scalable infrastructure. In addition to high capacity and easy availability, its cloud networking solutions promise predictable performance along with programmability that enables integration with third-party applications for network management, automation and orchestration. During the second quarter, the company unveiled its new 7800R product family for 400G cloud networking, along with the latest generation of 7500R and 7280R Series to address every layer of the network. These are expected to get reflected in the upcoming results.
The company also expanded its cognitive campus portfolio with unified wired and wireless campus edge products. Based on open cloud networking principles used to build modern cloud datacenters, Arista’s Cognitive Cloud Networking has leveraged Extensible Operating System (EOS) and CloudVision to extend the Universal Cloud Network architecture to the campus. During the quarter, the company’s cutting-edge switching infrastructure was chosen by CBC/Radio-Canada — Canada’s national public broadcaster — for the latter’s new “Maison de Radio-Canada” in Montreal. Notably, Arista EOS will provide the performance of a traditional broadcast infrastructure, while enabling CBC to meet customer demands for high definition audio and video, including 4k and 8k.
With solid demand for data center switches and continued spending on IT infrastructure products (server, enterprise storage and Ethernet switches) for deployment in cloud environments, Arista is likely to record healthy rise in revenues. The company expects second-quarter revenues in the range of $600 million to $610 million. The Zacks Consensus Estimate for the same is pegged at $606 million. In the year-earlier quarter, the company generated revenues of $520 million.
Earnings Whispers
Our proven model does not conclusively show that Arista will beat earnings in the second quarter as it does not possess the key components. A stock needs to have both a positive Earnings ESP Filter .
Arista Networks, Inc. Price and EPS Surprise
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