ARISTA NETWORKS, INC., DEF 14A filed on 4/24/2024
Proxy Statement (definitive)
v3.24.1.u1
Cover
 12 Months Ended
Dec. 31, 2023
Document Information [Line Items]  
Document Type DEF 14A
Amendment Flag false
Entity Information [Line Items]  
Entity Registrant Name ARISTA NETWORKS, INC.
Entity Central Index Key 0001596532
v3.24.1.u1
Pay vs Performance Disclosure
$ / USD in Millions
 12 Months Ended
Dec. 31, 2023
USD ($)
$ / USD
Dec. 31, 2022
USD ($)
$ / USD
Dec. 31, 2021
USD ($)
$ / USD
Dec. 31, 2020
USD ($)
$ / USD
Pay vs Performance Disclosure        
Pay vs Performance Disclosure, Table
Pay Versus Performance
As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid (“CAP”) and certain measures of the financial performance of the Company. For further information concerning the Company’s variable pay-for-performance philosophy and how the Company aligns executive compensation with corporate performance, please refer to the Compensation Discussion and Analysis.
The following table reports the compensation of our Principal Executive Officer (PEO) and the average compensation of the other Named Executive Officers (non-PEO NEOs) as reported in the Summary Compensation Table for the past four fiscal years, as well as their “Compensation Actually Paid” as calculated pursuant to recently adopted SEC rules and certain performance measures required by the rules.
 
                            Value of Initial Fixed $100
Investment Based On:		              
Fiscal
Year		   Summary
Compensation
Table Total
PEO		     Compensation
Actually Paid
PEO		     Average
Summary
Compensation
Table Total
non-PEO NEOs
     Avg.
Compensation
Actually
Paid
non-PEO

NEOs		     Company
Total
Shareholder
Return		     Peer Group
Total
Shareholder
Return		     Net
Income		     Revenue    
(a)
   (b)     (c)     (d)     (e)     (f)     (g)     (h)     (i)    
2023
  
$
15,561,987
 
  
$
63,914,394
 
  
$
4,918,724
 
  
$
20,487,088
 
  
$
463
 
  
$
133
 
  
$
2,087
 
  
$
5,860  
 
2022
  
$
10,735,887
 
  
$
3,171,085
 
  
$
3,285,597
 
  
 
($785,576
) 
  
$
239
 
  
$
117
 
  
$
1,352
 
  
$
4,381  
 
2021
  
$
15,993,632
 
  
$
65,318,255
 
  
$
4,157,062
 
  
$
25,133,973
 
  
$
283
 
  
$
129
 
  
$
841
 
  
$
2,948  
 
2020
  
$
6,342,972
 
  
$
8,680,019
 
  
$
3,699,258
 
  
$
11,419,845
 
  
$
143
 
  
$
107
 
  
$
635
 
  
$
2,318  
 
Column (b)
Represents the total compensation reported for our CEO, Jayshree Ullal, in the Summary Compensation Table for each listed year. Mr. Ullal served as our CEO (PEO) for each year presented.
Column (c)
Represents the amount of Compensation Actually Paid (“CAP”) for a particular year, as computed in accordance with SEC rules. The dollar amounts do not reflect the actual amounts of compensation paid to our CEO during the applicable year.
To calculate CAP, the following amounts were deducted from and added to the “Total” compensation amount for the CEO reflected in each year’s Summary Compensation Table as follows:
 
  
 
    2023  
Summary Compensation Table Total
   
$
15,561,987
 
Subtract
Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year
    ($ 15,051,588 ) 
Add
Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year
    $ 29,429,212  
Add
Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years
    $ 27,056,544  
Add
Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year
    $ 0  
Add
Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year
    $ 6,918,239  
Subtract
Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year
    $ 0  
Add
Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation
    $ 0  
Compensation Actually Paid
   
$
63,914,394
 
 
Note that we have not reported any amounts in our Summary Compensation Table with respect to “Change in Pension and Nonqualified Deferred Compensation” and, accordingly, the adjustments with respect to such items prescribed by the pay-versus-performance rules are not relevant to our analysis and no adjustments have been made.
For purposes of calculating CAP, the fair value of equity awards is calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718) using consistent assumption methodologies used to calculate the grant date fair value of awards, and for awards subject to performance-based vesting conditions, based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year.
Column (d)
Represents the average of the total compensation reported for our non-PEO Named Executive Officers (“non-PEO NEOs”) in the Summary Compensation Table for each listed year. The non-PEO NEOs in each year were as follows:
2023: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
2022: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
2021: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
2020: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
Column (e)
Represents the average amount of Compensation Actually Paid (“CAP”) for a particular Covered Year, as computed in accordance with SEC rules, to our non-PEO NEOs. The dollar amounts do not reflect the actual amounts of compensation paid to our non-PEO NEOs during the applicable year.
To calculate the average CAP payable to our non-PEO NEOs, the following amounts were deducted from and added to the “Total” compensation amount for such non-PEO NEOs reflected in each year’s Summary Compensation Table as follows:
 
  
 
    2023  
Summary Compensation Table Total
   
$
4,918,724
 
Subtract
Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year
    ($ 4,388,223 ) 
Add
Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year
    $ 8,509,377  
Add
Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years
    $ 8,137,724  
Add
Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year
    $ 0  
Add
Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year
    $ 3,309,486  
Subtract
Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year
    $ 0  
Add
Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation
    $ 0  
Compensation Actually Paid
   
$
20,487,088
 
The assumptions used for determining the fair values shown in this table are materially consistent with those described in the note regarding Column (c).
Column (f)
Total shareholder return (“TSR”) is calculated by assuming that a $100 investment was made on the day prior to the first fiscal year reported below and reinvesting all dividends until the last day of each reported fiscal year.
Because listed fiscal years are presented in the table in reverse chronological order (from top to bottom), the table should be read from bottom to top for purposes of understanding cumulative returns over time.
Column (g)
The peer group utilized in the table above is the NYSE Composite Index, as used in the company’s performance graph in our annual report. For each listed fiscal year, the peer group cumulative TSR was calculated based on a deemed fixed investment of $100 in the index made on the day prior to the first fiscal year reported below and reinvesting all dividends until the last day of each reported fiscal year.
 
Column (h)
The dollar amounts reported are the Company’s net income reflected in the Company’s audited financial statements.
Column (i)
In the Company’s assessment, revenue is the financial performance measure that is the most important financial performance measure (other than total shareholder return and net income) used by the company in 2023 to link compensation actually paid to performance. The dollar amounts reported are the Company’s gross revenues (in millions) as reflected in the Company’s audited financial statements.
     
Company Selected Measure Name Revenue      
Named Executive Officers, Footnote
Represents the average of the total compensation reported for our non-PEO Named Executive Officers (“non-PEO NEOs”) in the Summary Compensation Table for each listed year. The non-PEO NEOs in each year were as follows:
2023: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
2022: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
2021: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
2020: Ita Brennan; Kenneth Duda; Anshul Sadana; Marc Taxay
     
Peer Group Issuers, Footnote The peer group utilized in the table above is the NYSE Composite Index, as used in the company’s performance graph in our annual report. For each listed fiscal year, the peer group cumulative TSR was calculated based on a deemed fixed investment of $100 in the index made on the day prior to the first fiscal year reported below and reinvesting all dividends until the last day of each reported fiscal year.      
PEO Total Compensation Amount $ 15,561,987 $ 10,735,887 $ 15,993,632 $ 6,342,972
PEO Actually Paid Compensation Amount $ 63,914,394 3,171,085 65,318,255 8,680,019
Adjustment To PEO Compensation, Footnote
To calculate CAP, the following amounts were deducted from and added to the “Total” compensation amount for the CEO reflected in each year’s Summary Compensation Table as follows:
 
  
 
    2023  
Summary Compensation Table Total
   
$
15,561,987
 
Subtract
Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year
    ($ 15,051,588 ) 
Add
Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year
    $ 29,429,212  
Add
Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years
    $ 27,056,544  
Add
Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year
    $ 0  
Add
Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year
    $ 6,918,239  
Subtract
Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year
    $ 0  
Add
Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation
    $ 0  
Compensation Actually Paid
   
$
63,914,394
 
 
Note that we have not reported any amounts in our Summary Compensation Table with respect to “Change in Pension and Nonqualified Deferred Compensation” and, accordingly, the adjustments with respect to such items prescribed by the pay-versus-performance rules are not relevant to our analysis and no adjustments have been made.
For purposes of calculating CAP, the fair value of equity awards is calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718) using consistent assumption methodologies used to calculate the grant date fair value of awards, and for awards subject to performance-based vesting conditions, based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year.
     
Non-PEO NEO Average Total Compensation Amount $ 4,918,724 3,285,597 4,157,062 3,699,258
Non-PEO NEO Average Compensation Actually Paid Amount $ 20,487,088 (785,576) 25,133,973 11,419,845
Adjustment to Non-PEO NEO Compensation Footnote
To calculate the average CAP payable to our non-PEO NEOs, the following amounts were deducted from and added to the “Total” compensation amount for such non-PEO NEOs reflected in each year’s Summary Compensation Table as follows:
 
  
 
    2023  
Summary Compensation Table Total
   
$
4,918,724
 
Subtract
Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year
    ($ 4,388,223 ) 
Add
Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year
    $ 8,509,377  
Add
Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years
    $ 8,137,724  
Add
Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year
    $ 0  
Add
Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year
    $ 3,309,486  
Subtract
Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year
    $ 0  
Add
Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation
    $ 0  
Compensation Actually Paid
   
$
20,487,088
 
The assumptions used for determining the fair values shown in this table are materially consistent with those described in the note regarding Column (c).
     
Compensation Actually Paid vs. Total Shareholder Return
Compensation Actually Paid Versus TSR
 
 
      
Compensation Actually Paid vs. Net Income
Compensation Actually Paid Versus Net Income
 
 
      
Compensation Actually Paid vs. Company Selected Measure
Compensation Actually Paid Versus Revenue
 
      
Total Shareholder Return Vs Peer Group
Company TSR vs. Peer Group TSR
 
 
      
Tabular List, Table
Tabular List of Performance Measures
The following table identifies the most important financial performance measures used by our Compensation Committee to link the “compensation actually paid” to our CEO and other NEOs in 2023, calculated in accordance with SEC regulations, to company performance. The role of each of these performance measures on our NEOs’ compensation is discussed in the CD&A.
 
Most Important Performance Measures
Revenue
Non-GAAP Operating Income
Non-GAAP Gross Margin
Compound Annual Growth Rate of Revenue
      
Total Shareholder Return Amount $ 463 239 283 143
Peer Group Total Shareholder Return Amount 133 117 129 107
Net Income (Loss) $ 2,087 $ 1,352 $ 841 $ 635
Company Selected Measure Amount | $ / USD 5,860 4,381 2,948 2,318
Measure:: 1        
Pay vs Performance Disclosure        
Name Revenue      
Measure:: 2        
Pay vs Performance Disclosure        
Name Non-GAAP Operating Income      
Measure:: 3        
Pay vs Performance Disclosure        
Name Non-GAAP Gross Margin      
Measure:: 4        
Pay vs Performance Disclosure        
Name Compound Annual Growth Rate of Revenue      
Jayshree Ullal [Member]        
Pay vs Performance Disclosure        
PEO Name Jayshree Ullal      
Mr. Ullal [Member]        
Pay vs Performance Disclosure        
PEO Name Mr. Ullal      
PEO | Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount $ (15,051,588)      
PEO | Fair Value at Fiscal YearEnd of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 29,429,212      
PEO | Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 27,056,544      
PEO | Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 0      
PEO | Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 6,918,239      
PEO | Fair Value as of Prior Fiscal YearEnd of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 0      
PEO | Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 0      
Non-PEO NEO | Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount (4,388,223)      
Non-PEO NEO | Fair Value at Fiscal YearEnd of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 8,509,377      
Non-PEO NEO | Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 8,137,724      
Non-PEO NEO | Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 0      
Non-PEO NEO | Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 3,309,486      
Non-PEO NEO | Fair Value as of Prior Fiscal YearEnd of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 0      
Non-PEO NEO | Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount $ 0