Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
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- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Geographic Areas
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2014
- Return on Equity (ROE) since 2014
- Debt to Equity since 2014
- Analysis of Revenues
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Liquidity Ratios (Summary)
Arista Networks Inc., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
- Current Ratio
- The current ratio exhibited a generally downward trend from March 2021 through June 2022, declining from 5.09 to 3.7. Following this period, it experienced cyclical fluctuations, rebounding to above 4.0 multiple times until the end of 2024. However, starting in the first quarter of 2025, the ratio declined again, reaching its lowest point in the dataset at 3.25 by September 2025. Overall, the current ratio indicates a weakening in short-term liquidity over the observed timeframe, despite intermittent recoveries.
- Quick Ratio
- The quick ratio mirrored the pattern of the current ratio but at somewhat lower levels throughout the periods. It dropped significantly from 4.33 in March 2021 to 2.73 in June 2022, indicating a reduction in highly liquid assets relative to current liabilities. Subsequent quarters showed moderate recovery, with peaks around 3.67 in March 2024, but the ratio trended downwards again entering 2025, falling to 2.48 by September 2025. This decline highlights a tightening of the company’s ability to cover its current obligations with its most liquid assets.
- Cash Ratio
- The cash ratio demonstrated a consistent decline from 3.85 in March 2021 to a low of 2.27 in June 2022, paralleling trends in the current and quick ratios but at even more conservative levels reflecting only cash and cash equivalents. Although there was a recovery phase that raised the ratio to above 3.0 in the first quarter of 2024, the ratio began to decrease from mid-2024 onward, reaching 2.17 by September 2025. This pattern indicates fluctuating cash availability but an overall diminishing buffer of immediate liquidity over time.
- Overall Liquidity Analysis
- All three liquidity ratios display a common pattern of initial decline during 2021 and early 2022, followed by partial recovery phases through 2023 and into early 2024. From mid-2024 to the end of the period in 2025, there is a noticeable downward trend, suggesting increased pressure on short-term financial stability. The gradual erosion of liquidity ratios may warrant attention as it could indicate a reduced capacity to meet short-term liabilities without relying on the sale of inventory or other less liquid assets.
Current Ratio
Arista Networks Inc., current ratio calculation (quarterly data)
| Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current assets | |||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Current ratio1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||||
| Apple Inc. | |||||||||||||||||||||||||
| Cisco Systems Inc. | |||||||||||||||||||||||||
| Dell Technologies Inc. | |||||||||||||||||||||||||
| Super Micro Computer Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q3 2025 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- The current assets demonstrate a consistent upward trend over the entire period. Starting from approximately $4.0 billion, current assets have steadily increased to reach around $15.2 billion by the last reported quarter. This growth indicates an expanding asset base, which may reflect increased liquidity, inventory, receivables, or other short-term resources available for operational use.
- Current Liabilities
- Current liabilities also exhibit a rising trajectory, increasing from roughly $787 million to about $4.7 billion. The growth in current liabilities, while substantial, has been proportionally less consistent and includes periods of more rapid increase, particularly in the most recent quarters. This rise could indicate greater short-term obligations such as accounts payable, accrued expenses, or short-term debt.
- Current Ratio
- The current ratio reveals a downward trend from an initially very strong position above 5.0 down to approximately 3.25. While the ratio remains above the benchmark value of 1, indicating the company maintains more current assets than current liabilities, the decline suggests a gradual reduction in liquidity buffer. This decrease could be a result of current liabilities increasing at a faster rate than current assets, especially evident in the latest quarters.
- Overall Analysis
- The financial data reveals that the company has substantially grown its current assets, reflecting positive growth and potentially enhanced operational capacity. However, the simultaneous rise in current liabilities has partially offset this growth in liquidity, evidenced by the decreasing current ratio. Although liquidity remains comfortable, the trend highlights a narrowing margin of safety in covering short-term obligations, which should be monitored to ensure continued financial stability.
Quick Ratio
Arista Networks Inc., quick ratio calculation (quarterly data)
| Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||||
| Marketable securities | |||||||||||||||||||||||||
| Accounts receivable, net | |||||||||||||||||||||||||
| Total quick assets | |||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Quick ratio1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||
| Apple Inc. | |||||||||||||||||||||||||
| Cisco Systems Inc. | |||||||||||||||||||||||||
| Dell Technologies Inc. | |||||||||||||||||||||||||
| Super Micro Computer Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q3 2025 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Quick Assets
- The total quick assets have demonstrated a generally upward trend over the observed periods. Starting from approximately 3.41 billion US dollars at the end of the first quarter of 2021, these assets consistently increased to about 4.07 billion by the first quarter of 2022. After a brief decline and fluctuation during mid-2022, the value resumed steady growth, reaching nearly 11.60 billion by the third quarter of 2025. This growth indicates increasing liquidity and availability of assets readily converted to cash over time.
- Current Liabilities
- Current liabilities increased significantly over the timeframe. Beginning at roughly 787 million US dollars in the first quarter of 2021, liabilities rose to approximately 1.37 billion by the first quarter of 2022. Throughout the subsequent quarters, current liabilities continued to escalate, reaching close to 4.67 billion by the third quarter of 2025. This sharp rise in liabilities suggests greater short-term obligations, which may impact liquidity and risk levels depending on asset coverage.
- Quick Ratio
- The quick ratio depicts changes in short-term liquidity. Initially, the ratio was very strong at over 4.3 at the start of 2021 but declined steadily to around 2.97 by the first quarter of 2022. This drop reflects a relatively faster increase in current liabilities compared to quick assets during this period. Although the quick ratio saw some recovery and oscillated between approximately 2.5 and 3.7 in subsequent periods, it overall shows a downward trend, ending below 2.5 by the third quarter of 2025. This decrease signals a weakening in the company’s capacity to cover its short-term liabilities with its most liquid assets, indicating a potential increase in liquidity risk despite growth in asset size.
Cash Ratio
Arista Networks Inc., cash ratio calculation (quarterly data)
| Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||||
| Marketable securities | |||||||||||||||||||||||||
| Total cash assets | |||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Cash ratio1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||
| Apple Inc. | |||||||||||||||||||||||||
| Cisco Systems Inc. | |||||||||||||||||||||||||
| Dell Technologies Inc. | |||||||||||||||||||||||||
| Super Micro Computer Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q3 2025 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets demonstrate an overall upward trend across the observed periods. Starting at approximately 3.03 billion US dollars at the end of Q1 2021, the cash assets experienced fluctuations but generally increased, reaching over 10.1 billion US dollars by Q3 2025. Notably, significant growth periods include the intervals between Q2 2023 and Q4 2024, where cash assets rose sharply from around 3.7 billion to more than 8.3 billion, and similarly from Q4 2024 to Q3 2025, where values climbed beyond 10 billion. Despite some minor decreases, the long-term trajectory indicates solid strengthening of cash holdings.
- Current liabilities
- Current liabilities show a consistent rising pattern throughout the periods. Starting at approximately 787 million US dollars in Q1 2021, liabilities steadily increased to above 4.6 billion by Q3 2025. The growth in liabilities is relatively smooth with some quarters exhibiting accelerated increases, particularly from Q4 2024 onwards, where liabilities escalated more rapidly, indicating potentially increased short-term obligations or operational scaling. This growing liability load suggests the need for careful monitoring in relation to liquidity and operational risk.
- Cash ratio
- The cash ratio, representing the liquidity position, exhibits variability but remains mostly above 2.0 over the entire timeline. Initially, the ratio was quite high, near 3.85 in Q1 2021, and although it declined to a low around 2.17 by Q3 2025, it generally maintained a level indicating the company holds at least twice the cash relative to current liabilities. Periods of decline in the cash ratio, such as in early 2022 and late 2024 through 2025, align with rising liabilities and slower relative growth in cash assets. Conversely, some recovery is observed around late 2023 to early 2024. This suggests ongoing efforts to maintain liquidity, though the downward trend toward the end may warrant attention.
- Overall Analysis
- Across the observed quarters, cash assets have grown more substantially than current liabilities in absolute terms, indicating strengthening financial resources. Nevertheless, the proportional increase of liabilities at a faster pace in recent periods has led to a gradual decline in liquidity ratios. The cash ratio remaining above 2.0 suggests a comfortable liquidity buffer; however, the downward trend towards the later quarters signals a possible tightening of liquidity. This pattern indicates a need to balance growth and operational demands with maintaining robust liquidity measures. Ongoing monitoring of cash flows and liabilities will be critical to sustaining the strong cash position while managing increasing obligations.