Arista Networks, Inc. ANET is an AI infrastructure company that works directly with AI hyperscalers Microsoft and Meta, doubling its revenue and earnings between 2022 and 2025.
The behind-the-scenes technology standout is set to follow up its stellar growth with roughly 20% EPS and sales growth in both 2026 and 2027 as the AI spending boom continues.
Arista’s upward earnings revisions have landed it a Zacks Rank #1 (Strong Buy), and it has an excellent balance sheet. On top of all that, the tech sector crushing Arista looks ready to break out of a technical range to new highs.
Buy AI Infrastructure Stock ANET and Hold Forever
Arista is a client-to-cloud networking powerhouse for large AI, data center, campus, and routing environments. Its growing portfolio helps connect computers, servers, and beyond to ensure fast and reliable data transfer.
Simply put, Arista designs and builds tons of the critical, high-speed tech-based “plumbing” that massive AI data centers rely on.
ANET’s networking infrastructure expanded rapidly over the past decade alongside the explosion of cloud computing, big data, and most recently and most critically, artificial intelligence.
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Arista is steadily expanding its portfolio and its reach in an economy that’s completely reliant on ultra-fast digital infrastructure running efficiently, nonstop. Microsoft MSFT and Meta META are two of Arista’s largest clients, highlighting its best-in-class offerings and ability to compete against rivals such as Cisco.
AI hyperscalers are spending hundreds of billions of dollars building out their AI data center networks and are dependent on Arista’s offerings. Despite some AI bubble worries, the spending spree is only heating up.
AI hyperscalers are projected to spend between $600 to $700 billion in capex this year, up from around $400 billion last year. Arista's customers Meta and Microsoft have positioned themselves to be leaders in the AI economy and are primed to adapt quickly.
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ANET highlighted some of its critical AI-focused milestones from Q4, including rolling out what it calls the “R4 series platforms for AI, data center, and routed backbone deployment deliver high performance, low AI job completion times” and more.
It also extended and improved its Arista AVA (Autonomous Virtual Assist) with “additional agentic AI capabilities for use cases such as multi-domain event correlation, continuous monitoring, and network troubleshooting.”
ANET’s AI-Driven Growth and Outlook
The combination of explosive AI tailwinds and durable customer relationships with some of the biggest cloud providers and AI hyperscalers, such as Microsoft should continue driving strong earnings growth for Arista.
ANET is positioned to benefit from the ongoing AI infrastructure boom and the long-term success of AI, even when the technologies mature out of their rapid growth phase.
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ANET’s ability to ride the AI spending wave helped it double its revenue between 2022 ($4.38 billion) and 2025 ($9.00 billion), which came after it more than doubled its sales from 2016 to 2021. The company also more than doubled its GAAP earnings between 2022 ($1.07 a share) and 2025 ($2.75).
Arista is projected to grow its sales by another 25% in FY26 (after 29% sales growth last year) and 20% in 2027 to reach $13.50 billion next year.
The networking infrastructure firm is projected to grow its adjusted earnings roughly 19% both this year and next. The chart below shows its impressive long-term earnings growth outlook.
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ANET’s recent upward earnings revisions earn it a Zacks Rank #1 (Strong Buy) and extend a steady run over the last several years. It has also beaten our EPS estimates for five years running.
Buy the AI Infrastructure Stock Before It Breaks Out?
The stock skyrocketed ~3,800% in the past 10 years to blow away Tech’s 420%, while crushing Microsoft’s 600% and Meta’s 500%. ANET has also more than doubled Tech in the past three years, surging 280% in the process.
The stock has doubled (+110%) in the past 12 months, and it’s on the verge of a potential breakout as it races to test its late-October peaks. ANET recently gapped above the critical level highlighted in green below. Now it only needs to run a bit more before it might hit new highs.
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The stock is possibly a bit overheated in the short run, alongside many other tech names, amid the rapid comeback. But long-term investors shouldn't try to play the market timing game.
Arista trades at a 36% discount to its highs with a PEG ratio of 2.5 and 22% below its peaks at 45.6X forward earnings.
The bow on Arista’s bull case is its exceptionally strong balance sheet, boasting $10.7 billion in cash and equivalents alongside negligible, near-zero debt.
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This article originally published on Zacks Investment Research (zacks.com).