Investors have been anticipating earnings results from legacy IT leader Cisco Systems Inc.’s (CSCO) smaller cloud-based networking rivals Juniper Networks Inc. (JNPR) and Arista Networks Inc. (ANET). As Cisco diversifies outside of its traditional hardware sales in core switching and routing segments, investors are worried its transformation plan won’t move ahead fast enough to hedge against declining market share in legacy businesses.

Juniper Gains on Cloud Growth

Sunnyvale, Calif-based computer networking vendor Juniper Networks reported earnings on April 24, which came in slightly above expectations. First-quarter earnings increased 24% to $0.46 per share, surpassing the consensus estimate of $0.42. Juniper posted sales up 11% to $1.22 billion, compared to the Street’s forecast $1.2 billion.

 

Shares of the cloud-based networking provider are up 9.7% from pre-earnings at a price of $30.47 on Thursday afternoon. Analysts see further upside from growth in the cloud business, where Juniper lists customers such as Microsoft Corp. (MSFT), International Business Machines Corp. (IBM) and Facebook Inc. (FB). Citigroup, however, warned on pressured product margins due to aggressive pricing, customer and product mixes and component headwinds.

Moving forward, Juniper expects current quarter earnings of $0.54 at the midpoint on revenue of $1.28 billion.

Arista Up on Another Earnings, Guidance Beat

Santa Clara, Calif.-based Arista Networks, founded by a group of ex-Cisco employees and in the midst of multi-year long litigation with the industry leader, reported first quarter earnings after market close on Thursday. Another consecutive earnings, revenue and guidance beat has sent shares up in after hours trading. (See also: Bulls Cheer as Arista Clears Legal Hurdle.)

 

The software-driven networking (SDN) solutions leader posted adjusted earnings of $0.93 per share, above analysts’ expectations for $0.86 and year-ago EPS of $0.68. For the three-month period ended March 31, Arista reported sales up 38% to $335.5 million, compared to the Street’s forecast $326.17 million. This quarter, management expects revenue of $359 million at the midpoint, above analysts’ forecasts of $343.74 million.

“As we kick off 2017, I am pleased with our performance this quarter,” said Arista President and Chief Executive Officer Jayshree Ullal. “We continue to experience meaningful relevance as customers shift to cloud networking.”

Closing at a price of $140.20 on Thursday, shares of Arista reflect a whopping 124% increase over the 12-month period.

CSCO PE Ratio (TTM) Chart

CSCO PE Ratio (TTM) data by YCharts

Legacy Networking Leader Up Ahead of Earnings

Cisco is slated to report its most recent fiscal third quarter earnings report on May 17. The Street foresees earnings to come in at $0.58, compared to year-ago EPS of $0.57 on revenues of $11.9 billion, reflecting a 0.9% decline year over year.

In fiscal Q2, Cisco surprised the Street with better-than-expected earnings, as a 2% decline in revenue was dragged down by legacy NGN Routing, Switching and Data Center product revenue, which declined 10%, 5% and 4%, respectively. Moving forward, investors are banking on strength in Cisco’s growth segments, including cybersecurity​, the Internet of Things (IoT) and collaboration, to offset declines in switching, the firm’s largest segment. Analysts have also upgraded shares of the tech giant on possible Trump tax benefits, as Cisco swiftly continues on its acquisition spree of next-gen tech and hybrid IT companies.

Hovering near a 52-week high at a price of $34.18 per share, CSCO reflects an approximate 33.9% gain over the 12-month period. (See also: Credit Suisse Upgrades Cisco on Trump Tax Plan.)

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.