The Revenue LinesNarrow moat

Arista Networks (ANET) — moat facet

Five dollars in six are hardware at 61%; the sixth is support at 82%, and it is the evidence for the software story.

Arista reports its revenue in two lines, and they are the two halves of the same sale. Product revenue was $7,576.9 million in 2025 and service revenue $1,428.8 million, of a total of $9,005.7 million.1 Product is the switches and routers and the network applications sold with them; service is the post-contract support, typically bought with the product and then renewed.2

2025 gross profit by line ($m, and gross margin)$4,598m · 60.7%Product$1,171m · 81.9%ServiceArista Form 10-K FY2025; revenue less cost of revenue by line
Service is 16% of revenue and 20% of gross profit.

The margins are very different. The product line kept about 60.7 cents of gross profit per dollar in 2025 and the service line about 81.9 cents.34 So service was about 15.9% of revenue and about 20.3% of gross profit.5

The two lines move at different speeds. Product revenue is set by how much the largest customers build in a given year, and it has fallen once in the past decade, by 9.4% in 2020.6 Service revenue grows with the installed base and rose every year from 2016 to 2025, about 29.7% a year, faster than product's 25.4%.789

The latest quarter was a product quarter. In the three months to 30 June 2026 product revenue rose 38.8% to $2,605.2 million and service revenue 31.3% to $430.5 million.1011 The customer-sector split Arista describes on its calls (cloud and AI titans, enterprise, providers) is approximate and not in its filings; the customer concentration it does file is argued under Major Clients.

These pages take the two lines in turn. The number that ties them together is the service share of gross profit, about 20.3% in 2025.12 If it keeps falling while product revenue surges, Arista is becoming more of a hardware company, whatever the software argument says.

Moat trajectory: Holding steady

Both lines grew 31-39% in the June 2026 quarter; service's share of revenue slipped as product surged.

The number that tests this moat
Moat Explorer calc
Service share of gross profit
About 20.3% in 2025

Falling while product surges means Arista is becoming more of a hardware company, whatever the software argument says.

How it's calculated: (1,428.8 - 258.3) / 5,768.7.
Source: Arista Form 10-K FY2025 (Moat Explorer calc) ↗
Dig deeper
DIG DEEPER 01
Product
A very good hardware business priced as a software one, with a margin the largest buyers keep pushing down.
DIG DEEPER 02
Service
Support revenue that has grown every year for a decade at about an 82% margin.
References
  1. ReportedProduct revenue was $7,576.9 million in 2025 and service revenue $1,428.8 million, of a total of $9,005.7 million.
    Arista Networks Form 10-K FY2025 - statements of income 2023-2025: product revenue $5,029.5M/$5,884.0M/$7,576.9M and cost $2,061.2M/$2,299.0M/$2,978.7M; service revenue $830.7M/$1,119.1M/$1,428.8M and cost $168.7M/$212.8M/$258.3M; total revenue $9,005.7M; product revenue +28.8% on higher shipments of switching and routing platforms; service revenue +27.7% on initial and renewal support contracts; revenue definitions; dependence on merchant silicon — FY2023-FY2025 · publ. February 2026 · source ↗
  2. ReportedProduct is the switches and routers and the network applications sold with them; service is the post-contract support, typically bought with the product and then renewed.
    Arista Networks Form 10-K FY2025 - statements of income 2023-2025: product revenue $5,029.5M/$5,884.0M/$7,576.9M and cost $2,061.2M/$2,299.0M/$2,978.7M; service revenue $830.7M/$1,119.1M/$1,428.8M and cost $168.7M/$212.8M/$258.3M; total revenue $9,005.7M; product revenue +28.8% on higher shipments of switching and routing platforms; service revenue +27.7% on initial and renewal support contracts; revenue definitions; dependence on merchant silicon — FY2023-FY2025 · publ. February 2026 · source ↗
  3. ReportedThe product line kept about 60.7 cents of gross profit per dollar in 2025 and the service line about 81.9 cents.
    Arista Networks Form 10-K FY2025 - statements of income 2023-2025: product revenue $5,029.5M/$5,884.0M/$7,576.9M and cost $2,061.2M/$2,299.0M/$2,978.7M; service revenue $830.7M/$1,119.1M/$1,428.8M and cost $168.7M/$212.8M/$258.3M; total revenue $9,005.7M; product revenue +28.8% on higher shipments of switching and routing platforms; service revenue +27.7% on initial and renewal support contracts; revenue definitions; dependence on merchant silicon — FY2023-FY2025 · publ. February 2026 · source ↗
  4. Moat Explorer calcThe product line kept about 60.7 cents of gross profit per dollar in 2025 and the service line about 81.9 cents.
    Moat Explorer calculation from Arista's Forms 10-K FY2018-FY2025 and the Q2 2026 release: gross margins by line, shares of revenue and gross profit, growth rates and compound growth — FY2016 to Q2 2026 · publ. 2026-09-23 · source ↗
  5. Moat Explorer calcSo service was about 15.9% of revenue and about 20.3% of gross profit.
    Moat Explorer calculation from Arista's Forms 10-K FY2018-FY2025 and the Q2 2026 release: gross margins by line, shares of revenue and gross profit, growth rates and compound growth — FY2016 to Q2 2026 · publ. 2026-09-23 · source ↗
  6. ReportedProduct revenue is set by how much the largest customers build in a given year, and it has fallen once in the past decade, by 9.4% in 2020.
    Arista Networks Form 10-K FY2020 - statements of operations 2018-2020; product revenue down $190.3M (9.4%) in 2020, 2019 having included $125.1M of deferred product revenue recognised on acceptance, with reduced sales to larger customers and COVID-19 supply constraints; service revenue +24.9% — FY2018-FY2020 · publ. February 2021 · source ↗
  7. ReportedService revenue grows with the installed base and rose every year from 2016 to 2025, about 29.7% a year, faster than product's 25.4%.
    Arista Networks Form 10-K FY2018 - statements of operations 2016-2018: product revenue $991.3M/$1,432.8M/$1,841.1M, cost $369.8M/$538.0M/$720.6M; service $137.8M/$213.4M/$310.3M, cost $36.3M/$46.4M/$57.4M — FY2016-FY2018 · publ. February 2019 · source ↗
  8. ReportedService revenue grows with the installed base and rose every year from 2016 to 2025, about 29.7% a year, faster than product's 25.4%.
    Arista Networks Form 10-K FY2025 - statements of income 2023-2025: product revenue $5,029.5M/$5,884.0M/$7,576.9M and cost $2,061.2M/$2,299.0M/$2,978.7M; service revenue $830.7M/$1,119.1M/$1,428.8M and cost $168.7M/$212.8M/$258.3M; total revenue $9,005.7M; product revenue +28.8% on higher shipments of switching and routing platforms; service revenue +27.7% on initial and renewal support contracts; revenue definitions; dependence on merchant silicon — FY2023-FY2025 · publ. February 2026 · source ↗
  9. Moat Explorer calcService revenue grows with the installed base and rose every year from 2016 to 2025, about 29.7% a year, faster than product's 25.4%.
    Moat Explorer calculation from Arista's Forms 10-K FY2018-FY2025 and the Q2 2026 release: gross margins by line, shares of revenue and gross profit, growth rates and compound growth — FY2016 to Q2 2026 · publ. 2026-09-23 · source ↗
  10. ReportedIn the three months to 30 June 2026 product revenue rose 38.8% to $2,605.2 million and service revenue 31.3% to $430.5 million.
    Arista Networks Q2 2026 results release (Exhibit 99.1, 4 August 2026) - product revenue $2,605.2M against $1,877.0M, service $430.5M against $327.8M; six months product $4,916.5M against $3,569.5M, service $828.2M against $640.1M; cost of product $1,047.5M against $707.3M, cost of service $77.9M; deferred revenue $5,100.7M current and $1,765.2M non-current; Q3 2026 revenue guidance ~$3.3B — Q2 2026 · publ. 4 August 2026 · source ↗
  11. Moat Explorer calcIn the three months to 30 June 2026 product revenue rose 38.8% to $2,605.2 million and service revenue 31.3% to $430.5 million.
    Moat Explorer calculation from Arista's Forms 10-K FY2018-FY2025 and the Q2 2026 release: gross margins by line, shares of revenue and gross profit, growth rates and compound growth — FY2016 to Q2 2026 · publ. 2026-09-23 · source ↗
  12. Moat Explorer calcThe number that ties them together is the service share of gross profit, about 20.3% in 2025.
    Moat Explorer calculation from Arista's Forms 10-K FY2018-FY2025 and the Q2 2026 release: gross margins by line, shares of revenue and gross profit, growth rates and compound growth — FY2016 to Q2 2026 · publ. 2026-09-23 · source ↗
Sources
Generated September 23, 2026