Q2 FY26 · Ended Jun 30, 2026 · View SEC filing
Lean spending outran a shrinking gross margin
Operating costs grew about half as fast as gross profit, so operating margin rose even as gross margin slipped.
For investorsWhat has to hold for the margin to recover?
For foundersSelling hardware on a software cost base
The filing ties a 2.32-point gross margin drop to a bigger share of sales to large customers on deeper discounts.
Net income grew 36.5% but free cash flow fell from a year earlier, with cash tied up in receivables, inventory and deferred costs.
Arista buys its chips and outsources manufacturing, so engineering goes into one operating system rather than factories.
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Business Lens describes Arista Networks from its own filings with the SEC. It is not a view on its shares, a target, or advice to buy, sell or hold anything; figures are as filed and may be restated by the company later. The filing is linked above.
