Arista Networks (ANET)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 64.13% | 61.95% | 61.07% | 63.80% | 63.82% |
| Operating profit margin | 42.05% | 38.52% | 34.86% | 31.37% | 30.14% |
| Pretax margin | 46.62% | 41.33% | 36.10% | 31.58% | 31.82% |
| Net profit margin | 40.73% | 35.62% | 30.87% | 28.52% | 27.33% |
Arista Networks has maintained a relatively stable gross profit margin over the past five years, ranging between 61.07% and 64.13%. This indicates the company's ability to control its production costs and generate profit from its core business activities.
The operating profit margin has shown a consistent upward trend, increasing from 30.14% in 2020 to 42.05% in 2024. This signifies Arista's efficiency in managing its operating expenses and improving operational profitability over the years.
Similarly, the pretax margin has demonstrated a notable growth pattern, rising from 31.82% in 2020 to 46.62% in 2024. This indicates the company's ability to generate higher pre-tax profits relative to its total revenue, showcasing effective cost management and revenue generation strategies.
Furthermore, Arista Networks has shown significant improvement in its net profit margin, increasing from 27.33% in 2020 to 40.73% in 2024. This reflects the company's ability to translate its revenue into higher net profits, highlighting strong financial performance and effective management of expenses and taxes.
Overall, Arista Networks has exhibited consistent profitability ratios over the years, indicating operational efficiency and healthy financial performance.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 20.97% | 22.67% | 22.54% | 16.13% | 14.76% |
| Return on assets (ROA) | 20.31% | 20.96% | 19.96% | 14.66% | 13.39% |
| Return on total capital | 29.46% | 31.27% | 31.26% | 23.24% | 21.07% |
| Return on equity (ROE) | 28.54% | 28.91% | 27.68% | 21.13% | 19.11% |
Arista Networks has demonstrated consistent improvement in its profitability ratios over the five-year period.
- Operating return on assets (Operating ROA) has increased from 14.76% in December 2020 to 20.97% in December 2024, indicating the company's ability to generate operating profits relative to its total assets has improved significantly.
- Return on assets (ROA) has also shown a positive trend, rising from 13.39% in December 2020 to 20.31% in December 2024. This metric reflects Arista Networks' overall efficiency in generating profits from its assets.
- Return on total capital has consistently increased from 21.07% in December 2020 to 29.46% in December 2024, showcasing the company's ability to generate returns for both debt and equity holders.
- Return on equity (ROE) has experienced steady growth, climbing from 19.11% in December 2020 to 28.54% in December 2024. This indicates Arista Networks' effectiveness in generating profits for its shareholders relative to the equity invested in the company.
Overall, Arista Networks' profitability ratios reflect a positive trajectory, indicating the company's sustained profitability and efficient utilization of its assets and capital over the five-year period.