Arista Networks (ANET) Loses 5.87% on Cutthroat AI Competition

We recently published 10 Stocks Hammered Harder than Wall Street. Arista Networks Inc. (NYSE:ANET) is one of the worst performers on Tuesday.

Arista Networks extended its losing streak to a third straight day on Tuesday, shedding 5.87 percent to finish at $138.79 apiece as investor sentiment was dampened by Nvidia Corp.’s bagging of new deals with Oracle and Meta for their Ethernet networking architectures.

In a statement on Monday, Nvidia said that it was tapped by the two companies for its NVIDIA Spectrum-X Ethernet networking switches to help boost their AI data centers.

The said partnership posed a significant threat to Arista Networks Inc. (NYSE:ANET), given Nvidia Corp.’s growing dominance in the AI infrastructure, and with Meta being among Arista’s biggest clients to date.

Both Arista Networks Inc. (NYSE:ANET) and Nvidia target an emerging market for back-end Ethernet networking technology connecting clusters of AI servers in cloud-computing data centers.

Meta’s adoption of Nvidia’s Spectrum signaled that a portion of its networking expenditures could shift away from Arista Networks Inc (NYSE:ANET).

While we acknowledge the potential of ANET as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.