Analysis of Geographic Areas
Arista Networks Inc. operates in 2 regions: United States and International.
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- Income Statement
- Cash Flow Statement
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Selected Financial Data since 2014
- Operating Profit Margin since 2014
- Total Asset Turnover since 2014
- Price to Sales (P/S) since 2014
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Area Asset Turnover
Arista Networks Inc., asset turnover by geographic area
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| United States | |||||
| International |
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).
- United States Asset Turnover Ratio
- The asset turnover ratio for the United States demonstrates a consistent upward trend beginning in 2021. Starting at 34.2 in 2021, it increased to 47.87 in 2022, followed by a continued rise to 56.96 in 2023, and further reaching 67.8 in 2024. This progression indicates a steady improvement in the efficiency with which assets are utilized within the United States market over the observed period.
- International Asset Turnover Ratio
- The international asset turnover ratio shows a more variable pattern but culminates in a substantial increase by 2024. It began at 49.91 in 2021, experienced a decline to 40.76 in 2022, but then sharply increased to 60.35 in 2023 and rose considerably to 87.45 in 2024. The initial dip suggests temporary challenges or inefficiencies, but the subsequent strong recovery and growth reflect improved asset use and possibly expanding international operations or better market conditions abroad.
- Comparative Analysis Between Regions
- While both regions demonstrate growth in asset turnover ratios from 2021 through 2024, the international segment exhibits a higher volatility but ends with a notably higher ratio in 2024 compared to the United States. This disparity could suggest differing market dynamics or strategic focuses, with the international operations potentially leveraging assets more effectively in the latest period. The steady growth in the United States contrasts with the sharper fluctuations internationally, highlighting areas for further analysis regarding operational efficiency and market conditions in each geographic segment.
Area Asset Turnover: United States
Arista Networks Inc.; United States; area asset turnover calculation
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Revenue | |||||
| Long-lived assets | |||||
| Area Activity Ratio | |||||
| Area asset turnover1 | |||||
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).
1 2024 Calculation
Area asset turnover = Revenue ÷ Long-lived assets
= ÷ =
The data for the United States geographic area reveals several significant trends over the five-year period ending December 31, 2024.
- Revenue
- Revenue shows a consistent and substantial upward trend from 2021 onward. Starting at 2,125,900 thousand US dollars in 2021, it increases significantly each year, reaching 5,663,000 thousand US dollars by 2024. This indicates strong sales growth and expanding market presence within the region.
- Long-lived assets
- The value of long-lived assets also increases steadily each year from 62,163 thousand US dollars in 2021 to 83,520 thousand US dollars in 2024. This gradual growth suggests ongoing investment in physical or capital assets supporting operations and expansion, though the growth rate is more moderate compared to revenue.
- Area asset turnover ratio
- The area asset turnover ratio demonstrates an improving efficiency of asset utilization over the observed years. It rises from 34.2 in 2021 to 67.8 in 2024, almost doubling in this span. This trend implies that the company is generating significantly more revenue per unit of asset value, reflecting enhanced operational efficiency or better management of fixed assets relative to revenues.
Collectively, these trends suggest the company is both expanding its asset base and increasing its effectiveness in using these assets to generate higher revenues in the United States geographic area. The growth in revenue surpasses that of long-lived assets, contributing to the improved asset turnover ratio and indicating strong operational momentum in this region.
Area Asset Turnover: International
Arista Networks Inc.; International; area asset turnover calculation
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Revenue | |||||
| Long-lived assets | |||||
| Area Activity Ratio | |||||
| Area asset turnover1 | |||||
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).
1 2024 Calculation
Area asset turnover = Revenue ÷ Long-lived assets
= ÷ =
- Revenue
- Revenue demonstrates a consistent upward trend from 2021 through 2024. Starting at approximately $822 million in 2021, it increased by about 16% to $957 million in 2022. The growth accelerated significantly in 2023, reaching approximately $1.32 billion, followed by a more modest increase to approximately $1.34 billion in 2024. This indicates expanding business activity or sales within the International segment over the four-year period.
- Long-lived Assets
- The value of long-lived assets shows variability over the period analyzed. The asset base increased from about $16.5 million in 2021 to nearly $23.5 million in 2022, reflecting asset additions or revaluations. However, a slight reduction occurred in 2023 with assets declining to approximately $21.9 million, followed by a more pronounced decrease in 2024 to around $15.3 million. This pattern suggests divestitures, depreciation, or impairments towards the later years.
- Area Asset Turnover
- Asset turnover ratio, which indicates the efficiency of asset utilization to generate revenue, fluctuates considerably during the period. After a decline from 49.91 in 2021 to 40.76 in 2022, there is a significant rise to 60.35 in 2023, followed by a sharp increase to 87.45 in 2024. The rising trend in 2023 and 2024 suggests improved operational efficiency or higher revenue generation relative to the asset base in these years.
- Summary Insights
- The revenue growth coupled with a reduction in long-lived assets in the later years contributes to the substantial increase in asset turnover, signaling enhanced asset efficiency. The decline in asset value in 2024 alongside steady revenue growth suggests a strategic optimization of asset utilization or a shift towards less asset-intensive operations within the International segment.
Revenue
Arista Networks Inc., revenue by geographic area
US$ in thousands
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| United States | |||||
| International | |||||
| Total |
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 geographic revenue data reveals significant growth trends over the observed periods, with particular emphasis on the United States and International segments.
- United States Revenue
- The revenue from the United States exhibited a strong upward trajectory. From 2021 to 2024, it increased from approximately $2.13 billion to $5.66 billion, representing a substantial growth. Each year showed a consistent increase, with particularly notable jumps from 2021 to 2022 and from 2023 to 2024, indicating robust domestic market expansion. The continuous rise supports the conclusion of increasing demand or enhanced market penetration within the United States.
- International Revenue
- International revenue also displayed growth throughout the timeframe, ascending from roughly $822 million in 2021 to $1.34 billion by 2024. Although growth was steady, the increments were relatively more moderate compared to the United States. The growth slowed somewhat in the last period, with a smaller increase between 2023 and 2024, suggesting a possible stabilization or challenges in scaling internationally.
- Total Revenue
- Total revenue mirrored the combined effect of the two segments, rising dramatically from about $2.95 billion in 2021 to $7.00 billion by 2024. The growth pattern is consistent with the sum of the segments, confirming that the United States segment is the primary driver. The total figures reflect strong overall financial growth, underscoring the company's expanding market presence and overall increasing sales volume.
In summary, the data indicates a clear and robust increase in revenue, with the United States as the dominant contributor to growth. International revenue is growing but at a slower pace, particularly in the latest period, which may warrant further investigation or strategic adjustments in international markets.
Long-lived assets
Arista Networks Inc., long-lived assets by geographic area
US$ in thousands
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| United States | |||||
| International | |||||
| Total |
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 data on long-lived assets categorized by geographic area reveals discernible trends over the analyzed period. The total value of these assets shows a general upward movement, increasing from $78,634 thousand in the initial reported year to a peak of $101,580 thousand, before experiencing a slight decline to $98,845 thousand in the most recent year.
- United States Long-Lived Assets
- The value of long-lived assets in the United States displays a consistent growth trajectory throughout the years. Commencing from $62,163 thousand, there is a steady increase in assets, reaching $83,520 thousand by the end of the period. This growth represents a substantial expansion in asset base within the domestic market, indicating a focus or strengthening of the asset portfolio in the United States.
- International Long-Lived Assets
- International long-lived assets exhibit a more volatile trend. After starting at $16,471 thousand, there is an initial rise to $23,469 thousand, followed by a decline to $15,325 thousand in the latest year. This fluctuation suggests some instability or strategic adjustments in asset positioning outside the United States, potentially reflecting market conditions, asset disposals, or reallocation of resources.
- Total Long-Lived Assets
- The aggregation of domestic and international assets confirms the upward trend, peaking in the second-to-last period before a mild decrease. The total figures corroborate the significant contribution of the United States assets to overall growth, while the international component introduces variability and a recent downward pressure. This combined analysis implies a strategic emphasis on expanding or maintaining long-lived assets primarily in the United States, with a more cautious or varied approach internationally.