Arista Networks, Inc. (ANET) Earnings Call Transcript & Summary

Welcome to the Arista Networks, Inc. Annual Meeting of Stockholders. I would now like to turn the conference over to Ita Brennan. Ma'am, please go ahead.

Good morning, everyone. My name is Ita Brennan, Senior Vice President and Chief Financial Officer of Arista Networks. Welcome to our 2020 Annual Stockholders Meeting, which this year is taking place virtually due to the impacts of COVID-19 pandemic. Before I call the meeting to order, let me begin by introducing the members of our Board of Directors and executive officers of Arista Networks who are all on the call today. The members of the Board attending are Andy Bechtolsheim, our Chairman and Chief Development Officer; Jayshree Ullal, our President and Chief Executive Officer; Charlie Giancarlo; Ann Mather; Dan Scheinman; Mark Templeton; and Nikos Theodosopoulos. In addition to our Board members, we also have present Marc Taxay, our Senior Vice President, General Counsel and Corporate Secretary. I'd also like to introduce Tara Murphree and Janet Peng of Ernst & Young, the company's external auditors. I've asked Marc Taxay to act as Secretary for the meeting and to record the minutes. We're now ready, and the meeting will officially come to order. We now get to proceed with the formal business of the meeting as indicated in our meeting notice and proxy statement. For this portion of the meeting, I will turn it over to Marc Taxay. Marc?

Thanks, Ita. Hi. I'm Marc Taxay, Arista's General Counsel. I'll begin by outlining the agenda and rules of the meeting. You can see the agenda on the annual meeting website, and the rules of procedure for today's meeting, by clicking on the rules of procedure link at the bottom of your screen. The annual meeting is being held in accordance with Arista's bylaws and Delaware law, and during the meeting -- during the formal meeting, we will address the matters described in our proxy statement. After the voting, we will announce the preliminary results of the meeting, and then the formal meeting will be adjourned. After we complete the formal meeting, there will be an opportunity for stockholders to ask questions regarding Arista. If you would like to vote your shares or ask questions during this meeting, you must have logged in to the meeting with your control number. If there are any stockholders who wish to vote at the meeting, you can do so by clicking the vote here button that is on your screen. You may vote your shares at any time once you have logged in to the meeting until the closing of the polls, which will happen after the proposals have been brought to the meeting. Please remember that, if you have not voted your shares when the voting is called, your vote will not count. During the meeting, we will accept questions from stockholders about the matters being voted upon, and after the meeting is adjourned, we will accept general questions about Arista. [Operator Instructions] We may not have an opportunity to answer all questions, but we will do our best to respond. I have proof of -- by affidavit signed by the employee of Broadridge Financial Solutions that certifies that the notice of this meeting has been duly given; and that either a notice of Internet availability of the notice of the meeting, the proxy statement and the 2019 annual report to stockholders or the documents themselves were mailed on or about April 15, 2020, to all stockholders of record as of April 2, 2020. I will file the proof of mailing of notice of the meeting with the minutes of this meeting. All stockholders of record at the close of business on April 2, 2020, or holders of a valid proxy are entitled to vote at the meeting. A list of the holders of record of the outstanding shares of the company's common stock on the record date for this meeting has been made available for examination by any stockholder for any purpose germane to the meeting for at least 10 days prior to this meeting and is also available to stockholders during this meeting on the web portal. [ Patricia Hudson ] has been appointed to act as the Inspector of Elections at today's meeting. [ Patricia ] acts on behalf of Broadridge Financial Solutions and has signed the customary oath of office to execute her duties with strict impartiality. We will file this oath with the minutes of this meeting. The Inspector of Election has polled the stockholders present at the meeting and has examined the proxies. The report of stockholders represented at the meeting has been submitted and indicated that holders of shares in excess of the numbers necessary to constitute a quorum are present or represented by proxy. The Inspector of Elections' report will be appended to the minutes. The time is now 11:07 a.m. on May 27, 2020, and the polls are now open for voting on the matters before the meeting. There are 3 proposals to be considered by the stockholders at this meeting. The first item of business is the reelection of Mark Templeton and Nikos Theodosopoulos to serve as Class III directors of the company for a term of office expiring at the Annual Meeting of Stockholders held in 2023 or until such director's successor have been elected and qualified. The second item of business is the approval on an advisory basis of the compensation of our named executive officers as described in the proxy statement. The third item of business is the ratification of the Audit Committee's appointment of Ernst & Young as the independent registered public accounting firm of the company for the year ending December 31, 2020. That was the final proposal for today's meeting. The company recommends that the stockholders vote for each of the director nominees and for proposals 2 and 3. If you have not already done so, please cast your vote now. I will pause for a moment to allow you to do so. [Voting]

We will now proceed to the question and comment part of the formal meeting. You will have a final opportunity to vote after discussion has taken place. I'll remind you that the meeting has been called for the purpose of considering the 3 items of business previously described. Accordingly, all questions and comments should be confined only to those matters. I will pause for a moment to review the questions we have received before I direct the question to a director or officer for a response. If there are no other questions, I'll move on. The time is now 11:09 a.m. on May 27, 2020, and the polls are now closed for voting. The Inspector of Elections will count the final votes and report on the results. The Inspector of Elections has informed us that Mark Templeton and Nikos Theodosopoulos have been elected as Class III directors. The compensation of the company's named executive officers have been approved on an advisory basis. The appointment of Ernst & Young as our independent registered public accounting firm for the year ending December 31, 2020, has been ratified. The final tally of the votes will be set forth in the report of the Inspector of Elections and will be published within 4 business days in a current report on Form 8-K to be filed with the Securities and Exchange Commission. This meeting is now formally adjourned. We really appreciate that you took the time to attend our meeting, and we'd like to take this time to share some of our thoughts with you about the business. Before we get further, I would like to note that, during this discussion, we will make forward-looking statements which are subject to the risks and uncertainties that we discuss in detail in our documents filed with the SEC, specifically in our most recent Form 10-K and 10-Q, and which could cause material -- actual results to differ materially from those anticipated by these statements. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our forward-looking statements. Any such forward-looking statements apply as of today, and you should not rely on them as representing our views on the future. We undertake no obligation to update these statements after this call. We'd love now to open it up for questions. I'll pause for a moment to review the questions that we've received. Okay, thank you again for coming to our Annual Meeting of Stockholders. We appreciate your support and look forward to seeing you next year. And with that, we conclude the call.

Thank you for attending today's meeting. You may now disconnect.