What happened

After experiencing an after-market pop on Monday, Arista Networks (ANET 2.90%) rose nearly 5% in Tuesday trading. Later in the day investor sentiment cooled on the stock, leaving it basically flat over Monday's close as of late afternoon trading. Those initial flurries of excitement were due to the company's latest set of quarterly results.

So what

Arista unveiled its second-quarter results following Monday's market close. These revealed that the cloud-based networking specialist notched its first billion-dollar quarter, with revenue hitting $1.05 billion for the period. This was a robust 49% higher on a year-over-year basis. Not to be outdone, non-GAAP (adjusted) net income rocketed 58% higher to reach nearly $343 million ($1.08 per share).

Both headline figures trounced the average analyst estimates. Collectively, prognosticators following the stock were modeling less than $980 million on the top line, and only $0.92 in adjusted, per-share net income.

In its earnings release, Arista quoted its CFO Ita Brennan as saying that "We are pleased with overall business momentum in the quarter with strong revenue growth driving significant EPS upside and demonstrating the inherent operational leverage of the business model."

Now what

Arista proffered selected guidance for its current (third) quarter, stating that it anticipates another billion-dollar-plus frame with revenue of almost $1.03 billion to nearly $1.08 billion. Non-GAAP operating margin should come in at roughly 39%. No bottom-line forecasts were provided.

After the initial euphoria about the results, it seems investors were taking heed of the more cautious post-earnings notes being published by some analysts. For example, Barclays' Tim Long wrote that "We expect most upside is already priced in at current levels with tougher comparisons coming."

"Facebook (on its Q2 earnings call) also hinted at potential moderation in 2023 capital spending," he added, referring to the core Meta Platforms business unit that is an important Arista client.