Arista Networks stock fell sharply after Q1 earnings despite topping estimates and raising Q2 guidance, but analysts see the selloff as an overreaction with negative news already priced in.

Arista Networks' first-quarter revenue grew 35% year over year, topping earnings and revenue estimates and raising Q2 2026 revenue guidance, but the stock fell sharply in response.

The company cited supply constraints crimping profit margins: full-year operating margins are now expected at only 46%, down from last year's average of just above 48%. Arista specializes in networking hardware and software (routers, cables, and specialty software) that addresses AI's data bottleneck.

Analysts expect 29% top-line growth for the full year and 22% earnings growth for 2026, and the majority rate ANET stock as a strong buy with a 12-month price target of $188.42, nearly 20% above the stock's price at the time of writing.