Arista Networks (ANET)

Payables turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	3,088,570	2,781,440	2,159,460	1,465,750	1,155,330
Payables	US$ in thousands	381,083	435,059	232,572	202,636	134,235
Payables turnover		8.10	6.39	9.29	7.23	8.61

December 31, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $3,088,570K ÷ $381,083K
= 8.10

Arista Networks' payables turnover ratio has shown fluctuations over the years. In December 31, 2020, the payables turnover ratio was 8.61, indicating that the company converted its accounts payable into cash 8.61 times during that year. Subsequently, in December 31, 2021, the ratio decreased to 7.23, suggesting a slower rate of payables turnover compared to the previous year.

However, the payables turnover ratio improved in December 31, 2022, reaching 9.29, indicating that the company was able to manage its accounts payable more efficiently and converted them into cash more frequently. This positive trend was not sustained, as the ratio dropped in December 31, 2023, to 6.39, reflecting a decline in the speed at which Arista Networks settled its payables.

Nevertheless, by December 31, 2024, the payables turnover ratio recovered to 8.10, showing a better performance in converting accounts payable into cash compared to the prior year. Overall, while there were fluctuations in the payables turnover ratio, Arista Networks has demonstrated varying degrees of efficiency in managing its payables during the analyzed period.