SecProbe.io

February 27, 2014

Via E -mail
Jayshree Ullal
President and Chief Executive Officer
Arista Networks, Inc.
5453 Great America Parkway
Santa Clara, CA 95054

Re: Arista Networks, Inc.
Confidential Draft Registration Statement on Form S -1
Submitted January 31, 2014
  CIK No. 0001596532

Dear Ms.  Ullal:

We have reviewed your confidential draft registration statement and have the following
comments.  In some of our comments, we may ask you to provide us with information so we
may better u nderstand your disclosure.

Please respond to this letter by providing the requested information and either submitting
an amended confidential draft registration statement or publicly filing your registration statement
on EDGAR.  If you do not believe our comments apply to your facts and circumstances or do not
believe an amendment is appropriate, please tell us why in your response.

After reviewing the information you provide in response to these comments and your
amended confidential draft registration statement or filed registration statement, we may have
additional comments.

General

1. We will process your amendments without price  ranges.  Since the price range you select
will affect disclosure in several sections of the filing, we will need sufficient time to
process your amendments once a price range is included and the material information
now appearing blank throughout the docu ment has been provided.  The effect of the price
range on disclosure throughout the document may cause us to raise issues on areas not
previously commented on.

2. Please supplementally provide us with copies of all written communications, as defined
in Rule 405 under the Securities Act, that you, or anyone authorized to do so on your

Jayshree Ullal
Arista Networks, Inc.
February 27 , 2014
Page 2

 behalf, present to potential investors in reliance on Section 5(d) of the Securities Act,
whether or not they retain copies of the communications.  Similarly, please
supplemental ly provide us with any research reports about you that are published or
distributed in reliance upon Section 2(a)(3) of the Securities Act of 1933 added by
Section 105(a) of the Jumpstart Our Business Startups Act by any broker or dealer that is
participat ing or will participate in your offering.

Prospectus Cover Page

3. As soon as practicable, please provide us with copies of any artwork or graphics that you
intend to include in your prospectus.

Prospectus Summary, page 1

4. Please revise to provide the basis of your assertion that you are “a leading supplier of
cloud networking solutions that use software innovations to address the needs of large -
scale Internet companies, cloud service providers and next -generation data centers for
enterprises.”  For exa mple, it is unclear whether you are a leader based on market share ,
revenues or units of switches sold.

5. On page 1, you disclose that six of the largest cloud service provide rs based on annual
revenue are your customers.  Please advise us of the identity o f these customers.

6. Please revise to describe any requirement to prepay your $100 million in outstanding
convertible notes upon the close of your initial public offering and if your note holders
are bound to request a conversion into common stock instead o f cash.  We note your
disclosure on pages 71 and 118 indicates that you may elect to prepay the convertible
notes and the note holders may elect to convert the notes into common stock in lieu of
receiving cash.  Also, if material, please revise to identify  SingTel Innov8 Pte. Ltd and
Newfound Investment Partners LLC as note holders in the MD&A or on page II -4.

7. Please revise your summary to  disclose  that you r officers, directors, and principal
stockholders will have substantial control over you after the offering.

Risk Factors

We identified a material weakness in our internal controls for the years …, page 17

8. Please expand this risk factor and/or page 72 to  describe the material weaknesses in your
internal control in more detail.  For example, please describe the processes or systems
that were not implemented and what accounting policies or reconciliations lacked
sufficient oversight, if any.

Jayshree Ullal
Arista Networks, Inc.
February 27 , 2014
Page 3

 We may becom e involved in a license dispute with Optumsoft, page 20

9. Please broaden the scope of this risk factor or add a new risk factor to address the
conflicts of interest of David R. Cheriton caused by the fact he is a director and founder
of both parties of a po tential legal dispute.  You should address whether Mr. Cheriton
would be involved in any resolution of this dispute and describe Mr. Cheriton’s fiduciary
obligations to either party.

We are subject to a number of risks associated with the expansion …, pag e 22

10. To the extent there are material risks discussed in the bullet points on page 23, please
discuss them in more detail in separate risk factors.

Market and Industry Data, page 46

11. Please provide us supplemental copies of the reports or other source do cumentation that
you cite on page 46 from which market or other data is extracted, such as Crehan
Research, Inc.  To expedite our review, please clearly mark each source to highlight the
applicable portion of the section containing the statistic, and cross -reference it to the
appropriate location in your prospectus.

12. Please advise us whether you commissioned the Crehan Research report cited in your
prospectus.  Further, please revise to cite the date and title of the report.

13. Please revise to remove your disclaimer that the market information you provide is
“generally reliable.”

Management’s Discussion and Analysis of Financial Condition and Results of Operation

General

14. We note on page 18 that your large end customers have received lower prices, bundled
upgrades, extended warranties, acceptance terms and extended return policies and other
contractual rights.  Please expand your discussion of revenues and costs of sales to
address any changes in sales and costs of sales for large end customers from  period to
period.

15. Refer to your discussion of gross margin on page 61.  We note that your higher -
performance products generally have higher gross margins than your lower -performance
products.  Please expand your discussion of gross margin for each of th e periods
presented to include any material changes in gross margin due to changes in the average
level of performance of products sold or tell us why you believe such an analysis is not
material.

Jayshree Ullal
Arista Networks, Inc.
February 27 , 2014
Page 4

16. We note on page 18 that your sales force and channel part ners generate a substantial
portion of your revenue during the last few weeks of each quarter in order to meet their
sales objectives.  Please discuss whether there are any differences in your return activity
for sales made at the end of fiscal quarters as  compared to sales recognized during the
quarters, if material.

Overview, page 57

17. We note that 80% of your total revenues for the year ended December 31, 2012 are
attributable to the “Americas.”  Please provide more detail as to the total revenues
provid ed in North America or similar geographic area.

18. Please advise us whether the number of your end -customers is a key metric used by
management to evaluate your business.  You provide these figures throughout your
prospectus selectively for December 31, 2010  and December 31, 2013, but you do not
provide them for interim periods.

Results of Operations, page 63

19. You attribute the increase in sales and marketing, research and development, and general
administrative expenses, in part, to the increase in person nel costs.  Please revise to
provide specific headcount figures for the periods presented.   We note you provide total
headcount figures of 100 employees as of December 31, 2010 and 750 employees as of
December 31, 2013 on page 12 of your risk factors sect ion.

20. You attribute your strong sales growth to the increase in the number of unit sales.  Please
advise us whether the number of units sold is a key metric used by management to
evaluation your business.

Common Stock Valuations, page 76

21. Please expand the disclosure to state that estimates are not necessary to determine fair
value of new awards once underlying shares begin trading.

22. Refer to the discussion of fair value on page 81.  We note that you issued common stock
for $25 and $27 per share in Dece mber 2012 and April 2013, but that you determined the
fair value to be $7.76 and $8.77 per share as of February and May 2013, respectively.
Please tell us why you believe the fair value was so much lower than the amounts paid in
issuances for cash.  Also,  please integrate an analysis of private common stock
transactions to support your determination of fair value in your response.

Jayshree Ullal
Arista Networks, Inc.
February 27 , 2014
Page 5

Business

General

23. Please revise to provide the backlog disclosure required by Item 101(c)(1)(viii) of
Regulation S -K or tel l us why the disclosure is not required .

EOS Attributes, page 93

24. Please clarify whether the additional applications that may be purchased for complete
network visibility, as describe on page 94, constitute a material amount of your total or
service reve nues.   If yes, please advise us why you do not provide purchased applications
revenue here or in your management’s discussion and analysis section.

Customer Case Studies, page 95

25. Please revise to clarify the dates of the events described in each of your case studies.

26. On page 14, you describe that 48% of your revenue for the nine months ended September
30, 2013 was attributable to your 10 largest clients, with Microsoft accounting for 24%
for this period.  Please clarify whether Microsoft is a channel partner or a direct end -
customer.  Due to the size of your revenues attributable to Microsoft, it appears you are
substantially dependent on this relationship.  Please revis e to describe any material
agreements with Microsoft and file them under Item 601(b)(10) of Regulation S -K, or
advise us why you believe they are not required.

Customer Support and Services, page 95

27. Please briefly describe your service options for custom er support.  In addition to the
range of services provided under your various options, please describe whether these are
long term agreements and provide quantitative disclosure here or in your MD&A section
concerning the impact of the post contract suppor t to your business.  We note you
describe post contract support as “typically” purchased by your customers on page 58,
but you do not provide any percentages nor do you disclose service or post contract
support revenue.

Sales and Marketing, page 97

28. Pleas e revise to provide more details concerning your channel partners and clarify how
much of your revenue is derived from these sources as compared to direct sales.  For
example, please clarify whether any of your channel partners generates  a material amount
of your revenue and describe any related contracts or arrangements.

Jayshree Ullal
Arista Networks, Inc.
February 27 , 2014
Page 6

29. After the sales and distribution of the switches to end -customers by your direct
fulfillment center, please clarify how your products are installed and integrated to your
end-customers’ s ystems and data centers.  For example, please clarify if products are sold
directly by your direct sales staff and, if so, whether your customers rely on your
customer support to implement the switches and EOS, whether they hire third -party
integrators, or  rely on your channel partners.

Manufacturing, page 97

30. You subcontract the manufacturing of your products through third -party contract
manufacturers, such as Jabil Circuit, Foxconn, and Flextronics International.  Please
advise whether you have any mat erial agreements that you are substantially dependent
upon with any contract manufacturer.  If so, please file the appropriate agreements as
exhibits under Item 601(b)(10) of Regulation S -K and describe any material  terms of
those agreements.

31. Please revis e to describe the key components and material sources of those components
for your products.  We note, for example, that you describe the importance of integrated
circuit components and power supplies and key merchant silicon vendors, such as
Broadcom and Intel, as part of your supply chain on page 19.  Please describe how these
components differentiate your products compared to your competitors.

Intellectual Property, page 98

32. Please revise to briefly describe here or other appropriate places which comp onents of the
EOS relate to the 2004 agreement with Optumsoft that may now be in dispute.  Please
advise whether the 2004 agreement with Optumsoft is a material agreement under Item
601(b)(10) and whether it describes any dispute resolution processes or li censing fee
arrangements that may be implicated.  In addition, please clarify whether all of your
switching products are involved in the dispute.

Management

Executive Officers and Directors, page 101

33. Since it is unclear from your disclosure, please clarify whether your co -founder and Chief
Development Officer Andy Bechtolsheim is a full -time employee.

Jayshree Ullal
Arista Networks, Inc.
February 27 , 2014
Page 7

 Certain Relationships and Related Party Transactions, page 118

34. Please identify the related pa rties such as Messrs. Cheriton and Bechtolsheim and their
respective affiliates that are subject to your Investors’ Rights Agreements and who
receives registration rights under each agreement.

35. On page F -23, you disclose two related party Note Purchase Ag reements originally
entered into on 2008, but repaid and terminated in January 2011.  Please advise why the
repayment of these notes are not disclosed as related party transactions required to be
disclosed under Item 404(a) of Regulation S -K.  We refer you  to Instruction 1 to Item
404 requiring disclosure of related party transactions for two fiscal years preceding the
registrant’s last fiscal year.

36. On page F -40, you disclose related party sales and amounts due from customers that are
affiliated with your directors.  Please advise us whether any of these transactions are
required to be disclosed under Item 404(a) of Regulation S -K.

37. Your disclosure on pages 20 and 100 regarding your intellectual property dispute with
Optumsoft, Inc. refers to a 2004 agreeme nt and the fact that your director and largest
stockholder Mr. David Cheriton is also a director for Optumsoft.  Please advise whether
any transactions under the 2004 agreement (or any other agreement with Optumsoft) is
required to be disclosed under Item 404(a) of Regulation S -K.

Principal Stockholders, page 120

38. In Note (1) on page 121 of your beneficial ownership table, you disclose that Mr.
Cheriton disclaims voting and investment power of the shares held by the 2010 David R.
Cheriton Irrevocable Trus t.  Please revise to disclose the natural person(s) who holds
voting and/or investment power of the shares of common stock held in the trust.  In
particular, please clarify whether Mr. Cheriton is involved or influences the votes for the
shares held in the  trust.  We note you refer to Mr. Cheriton as you largest stockholder on
pages 21 and 100, taking into consideration of shares held in the 2010 David R. Cheriton
Irrevocable Trust.

39. Please advise us whether you will include the shares of common stock und erlying your
convertible note for Andy Bechtolsheim, as an individual, in your beneficial ownership
table.

40. Please advise us why the disclosure of the disclaimers of beneficial ownership in Notes
(1)-(3), (4), (7), and (9) on behalf of your management is  appropriate.  Further, Note (9)
discloses that Mr. Giancarlo disclaims voting and investment control as well as beneficial
ownership to the extent of his pecuniary interest.   Instruction 2 to Ite