Arista Networks Inc. (NYSE:ANET)

The financial data demonstrates a general upward trend in the gross value of property and equipment over the analyzed periods, indicating ongoing investments and expansions in physical assets.

Land

Land assets show a steady increase from 40,145 thousand US dollars in 2021 to 47,189 thousand US dollars in 2024, reflecting possible land acquisitions or revaluations over time. Data for 2020 is not available.

Equipment and machinery

This category exhibits robust growth from 70,655 thousand US dollars in 2020 to 160,673 thousand US dollars in 2024, more than doubling in value. This suggests significant capital expenditures aimed at increasing production or operational capabilities.

Computer hardware and software

Values for computer hardware and software also increase consistently from 40,081 thousand US dollars in 2020 to 63,941 thousand US dollars in 2024, indicating continued investments in technology and digital infrastructure.

Furniture and fixtures

Furniture and fixtures remain relatively stable with slight decreases from 3,787 thousand US dollars in 2020 to 3,526 thousand US dollars in 2024, indicating limited changes or possible disposals exceeding acquisitions in this category.

Leasehold improvements

Leasehold improvements fluctuate modestly, decreasing from 31,448 thousand US dollars in 2020 to 30,102 thousand US dollars in 2022 before increasing to 34,712 thousand US dollars in 2024. This pattern could reflect periodic renovations or upgrades to leased properties.

Construction-in-process

Construction-in-process shows a pronounced upward trend from 1,441 thousand US dollars in 2020 to 8,209 thousand US dollars in 2024, suggesting an increasing level of ongoing construction projects and capital work in progress.

Property and equipment, gross

The gross property and equipment balance grows steadily from 147,412 thousand US dollars in 2020 to 318,250 thousand US dollars in 2024. This overall increase confirms continued capital investment and asset accumulation during the period.

Accumulated depreciation

Accumulated depreciation increases significantly in magnitude from -115,181 thousand US dollars in 2020 to -219,405 thousand US dollars in 2024, consistent with aging assets and the growing asset base. The acceleration in depreciation suggests an expanding asset portfolio subject to wear and amortization.

Property and equipment, net

Net property and equipment values rise markedly from 32,231 thousand US dollars in 2020 to peak at 101,580 thousand US dollars in 2023 before slightly declining to 98,845 thousand US dollars in 2024. This slight decline in the final year may reflect increased depreciation expense outpacing gross asset additions or disposals.

In summary, the data reflects a pattern of substantial investment in equipment and technology assets, sustained growth in property holdings, and steady asset aging as shown by accumulated depreciation. The company appears to be actively expanding its operational base, with increasing construction projects and renewed leasehold improvements, while maintaining relatively stable levels of furniture and fixtures.

Average Age Ratio

Over the five-year period, the average age ratio of the property, plant, and equipment exhibits a fluctuating yet overall increasing trend. Beginning at 78.14% in 2020, it slightly decreases to 77.56% in 2021, then declines more noticeably to 74.56% in 2022. Afterward, it rises again to 76.76% in 2023, followed by a further increase reaching 80.94% by the end of 2024. This pattern suggests a temporary rejuvenation of assets around 2022, with subsequent aging thereafter.

Estimated Total Useful Life

The estimated total useful life of the assets shows some variation in the analyzed timeframe. It increases from 7 years in 2020 to 9 years in 2021, then decreases back to 8 years for each of the following three years (2022 to 2024). This fluctuation indicates a reassessment of asset longevity, with a peak estimation in 2021 followed by a stabilization at a slightly lower useful life.

Estimated Age (Time Elapsed Since Purchase)

The estimated age of assets remains relatively stable across the period, starting at 6 years in 2020 and increasing to 7 years in 2021. From 2022 onward, it holds steady at 6 years through 2024. This suggests that assets are either being replaced or revalued to maintain a consistent average age rather than continuously aging.

Estimated Remaining Life

The remaining useful life of the assets consistently stays at 2 years throughout all years analyzed. This constancy implies a steady expectation of residual asset utility, unaffected by changes in average age or total useful life estimations.

The property, plant, and equipment data shows a continuous increase in the gross value of property and equipment from 2020 through 2024. This increase indicates ongoing investments and additions to the company's tangible fixed assets over the five-year period. The gross value rose from approximately $147 million in 2020 to roughly $318 million in 2024, more than doubling over the period.

Accumulated depreciation also shows a consistent upward trend, increasing from about $115 million in 2020 to approximately $219 million in 2024. This indicates that the company is continuously recognizing depreciation expense on its assets, which is consistent with the increasing asset base. The growth in accumulated depreciation aligns with the growth in gross property and equipment, suggesting asset aging and usage in line with asset accumulation.

Land values appear starting from 2021, where it is recorded at about $40 million, and subsequently grows steadily to nearly $47 million by 2024. This rise suggests acquisitions or revaluations of land assets contributing to the fixed asset base. No land value was reported in 2020.

Average Age Ratio Trends

The average age ratio remained relatively stable between 2020 and 2024, fluctuating between approximately 74.56% and 80.94%. The ratio decreased from 78.14% in 2020 to a low of 74.56% in 2022, indicating a slight rejuvenation or replacement of older assets during those years. However, it increased again to 80.94% by 2024, reflecting a gradual aging of the asset base towards the end of the period.

Overall, the data indicates a pattern of steady capital expenditure, with the company continuing to invest in property and equipment assets annually. The growth in accumulated depreciation is consistent with asset aging, while the stable-to-rising average age ratio suggests a balance between asset additions and the natural aging process of the existing asset portfolio.

Property and Equipment, Gross

The gross value of property and equipment has demonstrated a consistent upward trend over the five-year period. It increased from 147,412 thousand US dollars in 2020 to 318,250 thousand US dollars in 2024, indicating significant investment or acquisition of fixed assets each year.

Land

The recorded value of land started appearing from 2021 and has steadily increased each year. Beginning at 40,145 thousand US dollars in 2021, it rose to 47,189 thousand US dollars in 2024. This growth suggests an increasing allocation of resources towards land assets within the overall property portfolio.

Depreciation Expense

Depreciation expense exhibited variability over the period studied. It slightly decreased from 20,100 thousand US dollars in 2020 to 19,500 thousand US dollars in 2021 but then escalated notably to 34,000 thousand US dollars in 2024. This rising depreciation expense in the latter years aligns with increased asset base and possibly reflects accelerated wear or changes in depreciation methods or asset mix.

Estimated Total Useful Life

The average estimated total useful life of the assets increased from 7 years in 2020 to 9 years in 2021 but was moderately reduced to 8 years for the subsequent years through 2024. This slight adjustment suggests a recalibration of asset lifespan assumptions, which could influence depreciation schedules and expense recognition.

Accumulated Depreciation

The accumulated depreciation exhibits a consistent upward trend over the five-year period. Starting from 115,181 thousand US dollars in 2020, it increases each year, reaching 219,405 thousand US dollars by the end of 2024. This steady growth indicates an increasing allocation of depreciation expense over the lifetime of the assets.

Depreciation Expense

The depreciation expense shows some variation but generally trends upward. It begins at 20,100 thousand US dollars in 2020, slightly decreases to 19,500 thousand in 2021, then rises significantly to 25,600 thousand in 2022. This increasing trajectory continues with 31,700 thousand in 2023 and finally reaches 34,000 thousand in 2024. The rising depreciation expense could suggest increased asset purchases, changes in depreciation methods, or a turnover towards newer assets.

Time Elapsed Since Purchase

The reported average time elapsed since purchase remains relatively stable around 6 to 7 years. It rises from 6 years in 2020 to 7 years in 2021, and then holds steady at 6 years from 2022 through 2024. This suggests a fairly consistent asset age profile without significant extension of asset lifespans or accelerated disposal of older assets.

Overall, the data reflects a gradual increase in the accumulated depreciation and depreciation expense, accompanied by a stable asset age. This pattern typically indicates ongoing investment in property, plant, and equipment, with assets being depreciated at increasing rates possibly due to asset additions or changes in asset utilization. The stable average asset age suggests a balanced asset replacement or maintenance strategy.

The analysis of the annual property, plant, and equipment data reveals several notable trends over the five-year period.

Property and equipment, net

The net property and equipment value demonstrates a significant increase from 32,231 thousand US dollars in 2020 to a peak of 101,580 thousand US dollars in 2023. However, in 2024, a slight decline is observed, with the value decreasing to 98,845 thousand US dollars. This pattern indicates substantial additions or capital expenditures through 2023, followed by some reduction or disposals in the final year.

Land

Land holdings, measured separately, show a consistent upward trend, starting from 40,145 thousand US dollars in 2021 and rising steadily each year to reach 47,189 thousand US dollars by 2024. This steady increase suggests ongoing investment in land acquisition or revaluation, without any recorded reductions.

Depreciation expense

Depreciation expense exhibits a fluctuating yet generally increasing pattern. It starts at 20,100 thousand US dollars in 2020, slightly decreasing to 19,500 thousand in 2021, then rising considerably in subsequent years to reach 34,000 thousand in 2024. The increasing depreciation likely reflects the growing asset base and perhaps accelerated depreciation methods or inclusion of new assets with shorter useful lives.

Estimated remaining life

The estimated remaining life of the assets remains constant at two years throughout the entire period. This consistency suggests a steady depreciation policy or asset usage expectation.

Overall, the data indicates active asset investment and accumulation until 2023, followed by stabilization or slight reduction in net asset value in 2024. The rise in land assets and depreciation expense aligns with expanding and aging asset base, respectively, while the stable estimated remaining life points to consistent asset valuation assumptions.