Balance Sheet: Liabilities and Stockholders’ Equity
The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.
Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.
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Arista Networks Inc., consolidated balance sheet: liabilities and stockholders’ equity
US$ in thousands
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
The financial data reveals notable trends observed in the liabilities and stockholders’ equity over the five-year span.
- Liabilities
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Current liabilities show a significant upward trend from approximately $768 million in 2020 to $2.73 billion in 2024. Key contributors to this increase include accounts payable, which more than doubled from $134 million to $381 million, and deferred revenue, which rose sharply from $396 million to $1.73 billion. Accrued liabilities also increased steadily, rising from $143 million in 2020 to $435 million in 2024. Supplier liability, introduced in 2021, displayed volatility, peaking in 2023 before decreasing sharply in 2024.
Non-current liabilities have also grown substantially, from $650 million in 2020 to $1.32 billion in 2024. Deferred revenue, non-current, displayed a consistent increase, more than quadrupling over the period. Other long-term liabilities showed a declining trend from 2020 to 2022 but reversed this trend by increasing again in 2023 and 2024.
Total liabilities rose markedly, surging from $1.42 billion in 2020 to over $4 billion in 2024, indicating a growing obligation base that more than doubled within four years.
- Stockholders’ Equity
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Stockholders’ equity manifested strong growth, rising from approximately $3.32 billion in 2020 to nearly $10 billion in 2024. Retained earnings demonstrated particularly robust growth, more than tripling from $2 billion to over $7.5 billion, suggesting profitable operations and significant reinvestment. Additional paid-in capital also increased steadily, indicating ongoing capital raises or stock issuance, moving from $1.29 billion to $2.47 billion over the period.
Accumulated other comprehensive income (loss) fluctuated negatively over the years, with losses deepening overall, indicating potential impacts from currency translations or other comprehensive loss items.
- Capital Structure and Overall Funding
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The balance between liabilities and stockholders’ equity shifted towards a higher total financing base, increasing from approximately $4.74 billion in 2020 to $14 billion in 2024. The growth in stockholders’ equity outpaced the growth in total liabilities, suggesting strengthening capital support by owners. The rise in additional paid-in capital and common stock par value indicates equity financing activities during this period.
Overall, the data indicates substantial expansion in both liabilities and equity, with deferred revenue becoming a significant source of liabilities. The company appears to be scaling operations considerably, supported by increased obligations and equity investments, while generating strong retained earnings, reflecting underlying profitability.