Arista Networks (ANET) risk factors, FY2025 10-K

Arista Networks's FY2025 10-K, filed Feb 17, 2026, lists 55 risk factors in 9 groups. Against the prior year's 53: 9 new, 7 dropped, 21 substantially reworded.

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Risk factors listed
559 groups
New this year
9vs 53 last year
Dropped
7since the prior 10-K
Substantially reworded
21of those kept
Section length
28k wordsItem 1A

What the changes say

  • Tariffs, export controls and other trade restrictions across China, Mexico, Malaysia and Vietnam receive heightened attention.
  • Supply-chain exposure centers on Broadcom switching chips, component availability, inventory and manufacturing disruptions.
  • The filing emphasizes cybersecurity, regulatory approvals, interoperability and catastrophic-event risks affecting network products and production.

What changed since the prior 10-K

New

  • NewRisks Related to Our Business and Industry

    Our products rely on components that we purchase, or our contract manufacturers purchase on our behalf from a limited number of suppliers, including certain sole source providers. In particular, we are primarily reliant upon our predominant merchant silicon vendor, Broadcom, for our switching chips

    Dependence on Broadcom and other limited-source suppliers could cause intellectual-property claims, product-roadmap problems or insufficient switching-chip supply.

  • NewRisks Related to Our Business and Industry

    Escalated or escalating U.S. tariffs, as well as countermeasures and retaliatory actions taken by other countries, may have a negative effect on global economic conditions, financial markets and our business

    U.S. tariffs and foreign retaliation could raise costs and weaken demand, margins and competitiveness because products are manufactured internationally.

  • NewRisks Related to Our Business and Industry

    The situation regarding these tariffs and trade policies has been and continues to be fluid, leading to significant uncertainty about the future relationship between the U.S., and other countries, with respect to tariffs and trade policies

    Further tariffs and trade barriers could increase production costs, disrupt inputs and suppliers, and prevent Arista from passing costs to customers.

  • NewRisks Related to Customers and Sales

    Our standard sales contracts contain indemnification provisions requiring us to defend our customers against third-party claims that could expose us to losses which could seriously harm our business, financial conditions, results of operations and prospects

    Customer indemnification commitments could require Arista to defend infringement claims and pay judgments, sometimes beyond amounts customers paid.

  • NewRisks Related to Products and Services

    If we are unable to devote the necessary resources to ensure that our products interoperate with operating systems, software applications and hardware that is developed by others, we may lose or fail to increase market share and experience a weakening demand for our products

    Failure to keep products compatible with customers’ networks, servers, operating systems and software could reduce demand and market share.

  • NewRisks Related to Supply Chain and Manufacturing

    Insufficient component supply and inventory management and the time to manufacture our products may result in lost sales opportunities or delayed revenue, while excess inventory may harm our gross margins

    Supply shortages, excess inventory and geopolitical disruptions could delay shipments, lose sales or damage margins.

  • NewRisks Related to Cybersecurity and Data Privacy

    We may experience cybersecurity incidents that we do not detect, or that we do not detect for extended periods of time. The techniques used to carry out attacks are constantly evolving, and it may be more difficult to detect attacks involving techniques that we are not aware of or have not anticipated

    Undetected or evolving cyberattacks could steal data, disrupt systems and orders, delay revenue recognition, or introduce software vulnerabilities.

  • NewRisks Related to Accounting, Compliance, Regulation and Tax

    Foreign investment laws and regulations, and other trade or regulatory barriers, may have a negative effect on global economic conditions, financial markets and our business

    Changing foreign investment rules, trade barriers and product-approval requirements could restrict sales in countries or to customers concerned about China-linked components.

  • NewGeneral Risks

    Our business is subject to the risks of natural disasters, social unrest, violent conflicts, systemic failures and other catastrophic events

    Disasters, disease, conflict, power or transportation failures affecting Arista’s sites, suppliers, logistics providers or customers could disrupt production and sales.

Dropped

  • DroppedRisks Related to Customers and Sales

    Our large customers generally require more favorable terms and conditions from their vendors and may request price concessions. As we seek to sell more products to these customers, we may be required to agree to terms and conditions that may have an adverse effect on our business or ability to recognize revenue

  • DroppedRisks Related to Supply Chain and Manufacturing

    Managing the supply of our products and product components is complex

  • DroppedRisks Related to Intellectual Property and Other Proprietary Rights

    This would allow our competitors to create similar products with lower development effort and time and ultimately could result in a loss of product sales for us

  • DroppedRisks Related to Cybersecurity and Data Privacy

    Defects, errors or vulnerabilities in our products, the failure of our products to detect security breaches or incidents, the misuse of our products or the risks of product liability could harm our reputation and adversely impact our operating results

  • DroppedRisks Related to Accounting, Compliance, Regulation and Tax

    We are subject to governmental export and import controls that could impair our ability to compete in international markets or subject us to liability if we violate these controls

  • DroppedRisks Related to Accounting, Compliance, Regulation and Tax

    Failure to comply with anti-bribery and anti-corruption laws and anti-money laundering laws, and similar laws, could subject us to penalties and other adverse consequences

  • DroppedGeneral Risks

    Our business is subject to the risks of earthquakes, fire, power outages, floods, health epidemics and other catastrophic events including as a result of climate change and to interruption by man-made problems such as terrorism and war

Reworded

  • 100% rewrittenRisks Related to Our Business and Industry

    Some of the key components in our products come from sole or limited sources of supply

    Expanded supplier dependence beyond component sourcing to Broadcom collaboration, product-roadmap execution, intellectual-property exposure and commercially sufficient supply.

  • 84% rewrittenRisks Related to Customers and Sales

    Declines in maintenance renewals and support contracts by customers could harm our future business, financial condition, results of operations and prospects

    No substantive change is shown; the maintenance-renewal risk text is unchanged.

    Was: Our business depends on customers renewing their maintenance and support contracts. Declines in maintenance renewals by customers could harm our future business, financial condition, results of operations and prospects

  • 82% rewrittenRisks Related to Our Business and Industry

    Industry cyclicality may cause fluctuations in our revenue and results of operations

    Reframed cyclicality around network-infrastructure demand, regional and customer differences, refresh cycles and largest-customer demand.

    Was: Seasonality and industry cyclicality may cause fluctuations in our revenue and results of operations

  • 81% rewrittenRisks Related to Accounting, Compliance, Regulation and Tax

    Enhanced U.S. trade restrictions affecting China and other countries, including export controls, import regulations, and foreign investment regulations, as well as countermeasures taken by affected countries may have a negative effect on global economic conditions, financial markets and our business

    Broadened from tariff exposure to export controls, sanctions, import and foreign-investment rules, including restricted-party lists and semiconductor controls.

    Was: Escalating U.S. tax, tariff, import/export restrictions, and other trade or regulatory barriers, as well as countermeasures taken by affected countries, may have a negative effect on global economic conditions, financial markets and our business

  • 73% rewrittenRisks Related to Our Business and Industry

    Our revenue and revenue growth rates are volatile and may decline or not meet our or our investors' expectations

    Updated historical growth rates through 2025 and added reliance on research-and-development investment, product expansion and technology leadership.

    Was: Our revenue and our revenue growth rates are volatile and may decline or not meet our or our investors' expectations

  • 71% rewrittenRisks Related to Accounting, Compliance, Regulation and Tax

    Judgment is required to evaluate our tax positions and determine our income tax liability. The accounting guidance for uncertainty in income taxes applies to all income tax positions, including the potential recovery of previously paid taxes, which if settled unfavorably could adversely affect income taxes

    Replaced possible post-election tax reform with enacted OBBB Act changes and OECD Pillar Two global-minimum-tax developments.

    Was: Significant judgment is required to evaluate our tax positions and determine our income tax liability. The accounting guidance for uncertainty in income taxes applies to all income tax positions, including the potential recovery of previously paid taxes, which if settled unfavorably could adversely affect income taxes

  • 68% rewrittenRisks Related to Our Business and Industry

    We expect our gross margins to vary over time and may be adversely affected by numerous factors

    Changed the manufacturing response from international trade wars to international trade tensions; other listed margin pressures remain substantially similar.

  • 67% rewrittenRisks Related to Intellectual Property and Other Proprietary Rights

    Our products contain third-party open source software components, and failure to comply with the terms of the underlying open source software licenses could restrict our ability to sell our products

    Adds that many open-source license terms remain untested or uninterpreted by U.S. courts, preserving source-code and commercialization uncertainty.

  • 61% rewrittenRisks Related to Accounting, Compliance, Regulation and Tax

    Changes in our income taxes or our effective tax rate, enactment of new tax laws or changes in the application of existing tax laws of various jurisdictions or adverse outcomes resulting from examination of our income tax returns could adversely affect our results

  • 59% rewrittenRisks Related to Accounting, Compliance, Regulation and Tax

    Issues in the development and use of artificial intelligence, combined with an uncertain regulatory environment, may result in reputational harm, liability, or other adverse consequences to our business operations

  • 58% rewrittenRisks Related to Our Business and Industry

    We expect large purchases by a limited number of customers to continue to represent a substantial portion of our revenue, and any loss, delay, decline or other change in expected purchases could result in material quarter-to-quarter fluctuations of our revenue or otherwise adversely affect our results of operations

  • 56% rewrittenRisks Related to Accounting, Compliance, Regulation and Tax

    Failure to comply with governmental laws and regulations, including privacy laws, environmental laws and export controls, could harm our business

    Was: Failure to comply with governmental laws and regulations could harm our business, financial condition, results of operations and prospects

  • 53% rewrittenGeneral Risks

    We may become involved in litigation that may materially adversely affect us

  • 48% rewrittenRisks Related to Our Business and Industry

    We are subject to a number of risks associated with the expansion of our international sales and operations

  • 38% rewrittenRisks Related to Our Business and Industry

    We have entered into significant purchase commitments and are susceptible to supply shortages, extended lead times or supply changes, which could disrupt or delay our scheduled product deliveries to our customers and may result in the loss of sales and customers

  • 37% rewrittenRisks Related to Supply Chain and Manufacturing

    We base our inventory requirements on our forecasts for future sales. If these demand forecasts materially change from our initial projections, we may procure inventory that we may be unable to use in a timely manner or at all

    Was: We base our inventory requirements on our forecasts of future sales. If these demand forecasts materially change from our initial projections, we may procure inventory that we may be unable to use in a timely manner or at all

  • 34% rewrittenRisks Related to Our Business and Industry

    We pursue new product and service offerings and expand into adjacent markets, and if we fail to successfully carry out these initiatives, our business, financial condition, or results of operations could be adversely impacted

  • 34% rewrittenRisks Related to Customers and Sales

    If we are unable to attract new large customers or to sell additional products and services in the AI Ethernet, Campus Workspace and Network Security Markets, to our existing customers, our revenue growth will be adversely affected and our revenue could decrease

  • 32% rewrittenRisks Related to Our Business and Industry

    Adverse economic conditions, continuing uncertain economic conditions or reduced information technology and network infrastructure spending may adversely affect our business, financial condition, results of operations and prospects

  • 27% rewrittenRisks Related to Accounting, Compliance, Regulation and Tax

    If we fail to maintain effective internal control over financial reporting in the future, the accuracy and timing of our financial reporting may be adversely affected

  • 26% rewrittenRisks Related to Products and Services

    Product quality problems, defects, errors or vulnerabilities in our products or services could harm our reputation and adversely affect our business, financial condition, results of operations and prospects

All 55 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Business and Industry

  1. 01Some of the key components in our products come from sole or limited sources of supply100% rewritten
  2. 02Our products rely on components that we purchase, or our contract manufacturers purchase on our behalf from a limited number of suppliers, including certain sole source providers. In particular, we are primarily reliant upon our predominant merchant silicon vendor, Broadcom, for our switching chipsNew
  3. 03We expect large purchases by a limited number of customers to continue to represent a substantial portion of our revenue, and any loss, delay, decline or other change in expected purchases could result in material quarter-to-quarter fluctuations of our revenue or otherwise adversely affect our results of operations58% rewritten
  4. 04Escalated or escalating U.S. tariffs, as well as countermeasures and retaliatory actions taken by other countries, may have a negative effect on global economic conditions, financial markets and our businessNew
  5. 05The situation regarding these tariffs and trade policies has been and continues to be fluid, leading to significant uncertainty about the future relationship between the U.S., and other countries, with respect to tariffs and trade policiesNew
  6. 06Adverse economic conditions, continuing uncertain economic conditions or reduced information technology and network infrastructure spending may adversely affect our business, financial condition, results of operations and prospects32% rewritten
  7. 07We have entered into significant purchase commitments and are susceptible to supply shortages, extended lead times or supply changes, which could disrupt or delay our scheduled product deliveries to our customers and may result in the loss of sales and customers38% rewritten
  8. 08Our revenue and revenue growth rates are volatile and may decline or not meet our or our investors' expectations73% rewritten
  9. 09We expect our gross margins to vary over time and may be adversely affected by numerous factors68% rewritten
  10. 10The networking market is rapidly evolving
  11. 11We pursue new product and service offerings and expand into adjacent markets, and if we fail to successfully carry out these initiatives, our business, financial condition, or results of operations could be adversely impacted34% rewritten
  12. 12We face intense competition, especially from larger, well-established companies and industry consolidation may lead to increased competition, which may harm our business, financial condition, results of operations and prospects
  13. 13We are subject to a number of risks associated with the expansion of our international sales and operations48% rewritten
  14. 14We have invested and may continue to invest in or acquire other businesses which could require significant management attention, disrupt our business, dilute stockholder value and adversely affect our business, financial condition, results of operations and prospects
  15. 15Industry cyclicality may cause fluctuations in our revenue and results of operations82% rewritten
  16. 16We are exposed to fluctuations in currency exchange rates, which could adversely affect our business, financial condition, results of operations and prospects
  17. 17Any failure to raise additional capital to expand our operations, invest in new products or for other corporate purposes on terms satisfactory to us could reduce our ability to compete and could harm our business, financial condition, results of operations and prospects

Risks Related to Customers and Sales

  1. 18If we are unable to attract new large customers or to sell additional products and services in the AI Ethernet, Campus Workspace and Network Security Markets, to our existing customers, our revenue growth will be adversely affected and our revenue could decrease34% rewritten
  2. 19Sales of our switches and routing platforms generate most of our product revenue, and if we are unable to continue to grow sales of these products, our business, financial condition, results of operations and prospects will suffer
  3. 20If we are unable to increase market awareness or acceptance of our new products and services, our revenue may not continue to grow or may decline
  4. 21The sales prices of our products and services may decrease, which may reduce our gross profits and adversely affect our results of operations
  5. 22Our sales cycles can be long and unpredictable, and our sales efforts require considerable time and expense. As a result, our sales and revenue are difficult to predict and may vary substantially from period to period, which may cause our results of operations to fluctuate significantly
  6. 23If we are unable to offer high-quality support and services offerings, this could adversely affect our business, financial condition, results of operations and prospects
  7. 24Declines in maintenance renewals and support contracts by customers could harm our future business, financial condition, results of operations and prospects84% rewritten
  8. 25Our standard sales contracts contain indemnification provisions requiring us to defend our customers against third-party claims that could expose us to losses which could seriously harm our business, financial conditions, results of operations and prospectsNew
  9. 26A portion of our revenue is generated by sales to government entities, which are subject to a number of challenges and risks
  10. 27We are exposed to the credit risk of our channel partners and some of our customers, which could result in material losses

Risks Related to Products and Services

  1. 28Product quality problems, defects, errors or vulnerabilities in our products or services could harm our reputation and adversely affect our business, financial condition, results of operations and prospects26% rewritten
  2. 29If we are unable to devote the necessary resources to ensure that our products interoperate with operating systems, software applications and hardware that is developed by others, we may lose or fail to increase market share and experience a weakening demand for our productsNew

Risks Related to Supply Chain and Manufacturing

  1. 30Insufficient component supply and inventory management and the time to manufacture our products may result in lost sales opportunities or delayed revenue, while excess inventory may harm our gross marginsNew
  2. 31We are susceptible to manufacturing delays and pricing fluctuations that could prevent us from shipping end-customer orders on time, if at all, or on a cost-effective basis, which may result in the loss of sales and customers
  3. 32We base our inventory requirements on our forecasts for future sales. If these demand forecasts materially change from our initial projections, we may procure inventory that we may be unable to use in a timely manner or at all37% rewritten
  4. 33Interruptions or delays in shipments could cause our revenue for the applicable period to fall below expected levels

Risks Related to Intellectual Property and Other Proprietary Rights

  1. 34Assertions by third parties of infringement, misappropriation or other violations by us of their intellectual property rights, or other lawsuits asserted against us, could result in significant costs and substantially harm our business, financial condition, results of operations and prospects
  2. 35We depend on our ability to protect our proprietary technology. We rely on trade secret, patent, copyright and trademark laws and confidentiality agreements with employees and third parties, all of which offer only limited protection
  3. 36We rely on the availability of licenses to third-party software and other intellectual property
  4. 37Our products contain third-party open source software components, and failure to comply with the terms of the underlying open source software licenses could restrict our ability to sell our products67% rewritten
  5. 38We provide access to our software and other selected source code to certain partners, which creates additional risk that our competitors could develop products that are similar to or better than ours

Risks Related to Cybersecurity and Data Privacy

  1. 39We may experience cybersecurity incidents that we do not detect, or that we do not detect for extended periods of time. The techniques used to carry out attacks are constantly evolving, and it may be more difficult to detect attacks involving techniques that we are not aware of or have not anticipatedNew

Risks Related to Accounting, Compliance, Regulation and Tax

  1. 40Foreign investment laws and regulations, and other trade or regulatory barriers, may have a negative effect on global economic conditions, financial markets and our businessNew
  2. 41Enhanced U.S. trade restrictions affecting China and other countries, including export controls, import regulations, and foreign investment regulations, as well as countermeasures taken by affected countries may have a negative effect on global economic conditions, financial markets and our business81% rewritten
  3. 42If we fail to maintain effective internal control over financial reporting in the future, the accuracy and timing of our financial reporting may be adversely affected27% rewritten
  4. 43Changes in our income taxes or our effective tax rate, enactment of new tax laws or changes in the application of existing tax laws of various jurisdictions or adverse outcomes resulting from examination of our income tax returns could adversely affect our results61% rewritten
  5. 44Judgment is required to evaluate our tax positions and determine our income tax liability. The accounting guidance for uncertainty in income taxes applies to all income tax positions, including the potential recovery of previously paid taxes, which if settled unfavorably could adversely affect income taxes71% rewritten
  6. 45Failure to comply with governmental laws and regulations, including privacy laws, environmental laws and export controls, could harm our business56% rewritten
  7. 46Issues in the development and use of artificial intelligence, combined with an uncertain regulatory environment, may result in reputational harm, liability, or other adverse consequences to our business operations59% rewritten

Risks Related to Ownership of Our Common Stock

  1. 47The trading price of our common stock has been and may continue to be volatile, and the value of your investment could decline
  2. 48We have adopted stock repurchase programs to repurchase shares of our common stock; however, any future decisions to reduce or discontinue repurchasing our common stock pursuant to such stock repurchase programs could cause the market price of our common stock to decline
  3. 49Sales of substantial amounts of our common stock in the public markets, or the perception that such sales might occur, could reduce the market price that our common stock might otherwise attain and dilute your voting power and your ownership interest in us
  4. 50Insiders have substantial control over us, which could limit your ability to influence the outcome of key transactions, including a change of control
  5. 51Our charter documents and Delaware law could discourage takeover attempts and lead to management entrenchment

General Risks

  1. 52We may become involved in litigation that may materially adversely affect us53% rewritten
  2. 53If we are unable to hire, retain, train and motivate qualified personnel and senior management, our business, financial condition, results of operations and prospects could suffer
  3. 54Our business is subject to the risks of natural disasters, social unrest, violent conflicts, systemic failures and other catastrophic eventsNew
  4. 55We have not paid dividends in the past and do not intend to pay dividends for the foreseeable future

Other Arista Networks 10-Ks

  • FY2024 10-K risk factors
    55 risks

    AI Ethernet, campus workspace and network security expansion creates major adoption and execution risk.

    Filed Feb 19, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.