Many analysts are blaming Facebook, one of the cloud software and networking company's largest customers, for the sudden slowdown in orders. MKM Partners analysts were among those who called out Facebook as the culprit behind Arista's "scary bad guidance."
Arista shares opened down 29%, which is below its previous worst when it fell 23% on Jan. 29, 2016. Earlier in the day, Arista shares hit an intraday all-time low of $173.31.
Representatives from Facebook weren't immediately available for comment.
"The shockingly big reduction is primarily due to Facebook, but also includes weaker performance in the service provider and tier 2 cloud provider verticals," MKM analysts said in a note to clients on Friday.
For the fourth quarter, Arista expects to report revenue between $540 million and $560 million, which is below consensus estimates of $686.2 million. Without naming Facebook, Arista CEO Jayshree Ullal said one of the company's cloud titan customers had decided to delay upgrading its servers and was shifting its new equipment orders to real-time to lower spending.
On the conference call with analysts, Ullal said Microsoft and Facebook will each represent 10% of revenue in 2019. She also said Microsoft wasn't the source of the decline in orders.