Arista Networks, Inc. stock research
FY2024 Q4
Arista Networks (ANET) Gross Margin — Quarter Ended Dec 31, 2024
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue also rose. Gross margin weakened slightly from the prior quarter and was lower than the same quarter a year ago.
Gross margin takeaway
Quarter ended Dec 31, 2024 · FY2024 Q4
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue also rose. Gross margin weakened slightly from the prior quarter and was lower than the same quarter a year ago.
- The strongest observable driver is the relationship between revenue growth and cost of revenue growth; revenue increased more than cost of revenue on a sequential basis, supporting gross profit expansion despite a marginal gross margin decline.
- Compared to the prior quarter, revenue and gross profit were higher, but gross margin was slightly lower. Compared to the same quarter one year earlier, revenue and gross profit were higher, while gross margin was lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
63.8%
Gross profit
$1.2B
Revenue
$1.9B
Cost of revenue
$699.4M
Quarter-over-quarter change
-0.4 pts
Year-over-year change
-1.1 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2024 | $1.6B | $1.0B | $570.0M | 63.7% |
| Jun 30, 2024 | $1.7B | $1.1B | $593.2M | 64.9% |
| Sep 30, 2024 | $1.8B | $1.2B | $649.2M | 64.2% |
| Dec 31, 2024 | $1.9B | $1.2B | $699.4M | 63.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2024
-0.4 pts
Year-over-year change
Dec 31, 2023
-1.1 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver is the relationship between revenue growth and cost of revenue growth; revenue increased more than cost of revenue on a sequential basis, supporting gross profit expansion despite a marginal gross margin decline.
Compared to the prior quarter, revenue and gross profit were higher, but gross margin was slightly lower. Compared to the same quarter one year earlier, revenue and gross profit were higher, while gross margin was lower.
Monitor the trajectory of cost of revenue relative to revenue, as its faster growth compared to the year-ago period contributed to the gross margin decline.