Arista Networks Inc at Barclays Global Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Tim Long - Barclays Capital Inc. - Analyst : So let's -- yes, we're going to bounce around a little bit. But maybe if we start more, Hardev, probably for you on when we're looking at Cloud and AI networking, there's a lot of debates about competition. So we've always been talking about white box, and it's always been there, but it's not going away as a discussion point. And obviously, over the last several years, given what NVIDIA has done with Mellanox, they've increased their presence a lot first with InfiniBand, now somewhat with Ethernet. So maybe if you can just kind of how you view competitive differentiation and dynamics and what is it that helps Arista win?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. You mentioned scale up and scale across. Maybe let's start with scale across. I was talking to you before, Ciena talking about like some more optical pluggable wins. How do you see Arista from a product standpoint playing? And maybe talk about whether it's latency, speed, distance, where is it where there's going to be a higher content of Arista in that scale across architecture?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. Great. And then maybe the second topic is scale up, and we'll talk a little bit as blue box because I think that's part of the target audience for that technology. I know you guys have had this blue box type of deployments already. But maybe walk us through how those products are different from a fully OS switch and how they're different from an EMS, ODM switch from like a Celestica or whatever. Talk to

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. But I'm -- so I mean, back to the scale up. So this is as far as guideposts when we see all this TPU growth or Trainium, that's going to most likely push -- that's going to be a big impetus to push scale up to Ethernet, and that opens up. Is that the right way to think about it?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. Got a lot more in Cloud, but maybe we'll go over to campus for a little bit.

Question: Tim Long - Barclays Capital Inc. - Analyst : Here's your first. Let's see if we can do it. Really good guidance, 50%-plus growth for next year, so accelerating after a few good years, which is normally not what happens in the campus world. So maybe walk us through how that's happening. And still very low market share. So how much runway is ahead?

Question: Tim Long - Barclays Capital Inc. - Analyst : Yes. And there was a new announcement this week, incorporating a little bit more AI? Talk about that a little bit?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. All right. Great. We touched on the $1.25 billion campus, maybe back to the AI and the $2.75 billion target, another one with really good growth. Maybe a little bit about -- obviously, you have two very large customers and 1/3 that's probably getting very large. You've discussed these four deployments, the scale deployment. So maybe give us an update there and how do you think about Arista's positioning as we go to more dense deployments and bigger GPU counts, does that advantage the EOS? Give even more advantages in those type of deployments?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. Great. Yes, I would love your perspective, one of the things that -- to the casual observer goes unnoticed is comparing revenues with other companies, and you guys obviously have a very large, deferred product revenue balance. If you can talk a little bit -- I've covered this space for a long time. I have seen this stuff before with newer technologies. But can you just level set with us what is causing that? What are the features or specifications that the customer is looking to see in the network before it could be recognized?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. And then maybe sticking on the data center and AI, a little bit on the go-to-market. So could you touch on maybe like Neoclouds and sovereigns that are getting a lot more attention. Are those harder to get those at bets? How are you making sure that you're involved because some of the competitors there like a Cisco or an NVIDIA might have a country presence or whatever for a long time. So maybe walk us through that part for some of the newer customers that could be some decent scale?

Question: Tim Long - Barclays Capital Inc. - Analyst : And then how about the -- obviously, NVIDIA has the benefit of selling a full rack and particularly with probably less technical savvy customer bases. It's easy to just -- even if their networking is not as strong as yours to bundle it. How does that dynamic work? How do you fight that dynamic? I'm sure the more sophisticated ones are making independent decisions.

Question: Tim Long - Barclays Capital Inc. - Analyst : Yes, it's going to --

Question: Tim Long - Barclays Capital Inc. - Analyst : Now is that fully because the consortium work together to match technical capabilities with InfiniBand and maybe customers don't want a proprietary type solution? And is it the sense that there still will be places where InfiniBand makes sense. But in general, it's going to be a downward trend?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. Maybe, Hardev, talk to us a little bit about speed migrations, 400 to 800, 800 to 1.6. How do you see -- where are we in that continuum now? I know some customers are going at different paces for sure, led by some of the very large hyperscalers. Sometimes it's led by hyperscalers that you're not a major supplier to, so it might look different. But like how much do those transitions matter? And do you generally see those transitions as opportunities to take more share or get involved in more use cases. Maybe just walk us through that dynamic?

Question: Tim Long - Barclays Capital Inc. - Analyst : Interesting angle to take. You did mention liquid cooling. I'm curious -- I think -- I know I was at your Analyst Day, and I think there was a slide that showed like a liquid cool switch. It was probably up there briefly. What's the timeline there? What's the savings? What's the power savings? What's the differentiation? And do you think that's going to become as big topic for switching as it has for, say, servers?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. You mentioned LPO and CPO. We get questions a lot about the impact of those technologies as well as OCS. If you could just talk about, one, the different interconnect and then, two, OCS, how you see that impacting the switching routing markets?

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. Yes. Great. Maybe we'll probably have time for one more, Mark for you with your operations hat on. Company was early on with purchase commitments. And I know, five years ago, some of us are saying, wow, what these numbers are massive. What are they doing? And they were needed and they're still needed. So maybe talk to us about where you are in capacity and component availability and what's the risk that there's some disruption in the next year or so because the demand is just so high.

Question: Tim Long - Barclays Capital Inc. - Analyst : Okay. Great. Well, I think we're up against time. So thank you both so much for joining. Thank you, everybody.