Data center engineering specialist Arista Networks (NYSE: ANET) had an epic 2022. After early pandemic supply chain constraints that kept a lid on equipment it could ship to customers began to ease, it was off to the races. Companies are migrating their IT infrastructure to the cloud en masse, and Arista is increasingly being turned to as a trusted engineering and parts design partner.
But a new era is just beginning to dawn: AI. Microsoft (NASDAQ: MSFT) is a top Arista Networks customer, and its recent investment in ChatGPT parent OpenAI could set off a new spate of growth for data centers in the coming years. Same goes for Meta (NASDAQ: META) and its new plans for its AI infrastructure. Arista's 2023 outlook had puts and takes, but the stock could still be a buy for investors with a long-term outlook.
Arista reported full-year 2022 revenue of $4.38 billion, a nearly 49% increase from 2021. Q4 2022 sales specifically notched a 55% year-over-year increase as cloud titans (big tech companies that operate their own data centers for the public cloud and for their own private use) spent heavily in the last year.
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This Top Data Center Stock Is Booming In A New Era For AI