What Arista’s Acquisition of Velocloud Means for the Enterprise

What Arista’s Acquisition of VeloCloud Means for the Enterprise

Larry
Hello, today is Friday, August 8th, 2025.  I’m Larry York from TC2 and this is Staying Connected.

Big news in the enterprise networking space is Arista’s recent acquisition of VeloCloud’s SD-WAN portfolio from Broadcom, in a deal analysts estimate at just over $1 billion.

I’m joined today by my colleague, Tony Mangino, to discuss both the immediate and strategic impact of the acquisition for enterprise customers.  Tony is the usual host of our Staying Connected podcast and a Director at TC2.

Tony, good to have you on the other side of the microphone here on Staying Connected!

Tony:
Great to be with you, Larry. You know, a number of our customers at TC2 have been inquiring about the potential impact of the acquisition.  This is one of those deals that sounds “technical” at first glance, but it has meaningful impact for enterprise customers and on the competitive landscape in enterprise networking. 

Larry:
So, for everyone listening who maybe doesn’t live and breathe SD-WAN, why does this acquisition matter?

Tony:
Right—this is a classic example of strategic fit meets market timing.

• Broadcom bought VMware, and along with it, inherited VeloCloud. But Broadcom isn’t really in the business of running distributed networks. They’re focused on software-defined infrastructure.
• Meanwhile, Arista has had a long-standing gap in its portfolio. They’re super strong in high-speed data center and cloud networking – but had no native SD-WAN or edge security offering.

So, VeloCloud was essentially “orphaned” inside Broadcom. And Arista, looking to compete deeper with the likes of Cisco and Fortinet, needed that piece to really pursue the enterprise networking market.

VeloCloud gives them:

• An immediate global SD-WAN footprint
• A mature network edge platform
• And a jumpstart into the SASE conversation without building it all from scratch.

Larry:
It sounds like both companies got what they wanted from the deal in very different ways.

Tony:
Exactly. Arista gets the missing puzzle piece for enterprise networking, and Broadcom gets to streamline their portfolio. Wall Street clearly approved—Arista’s stock jumped almost 7% after the announcement.

Larry:
Alright, let’s go a little deeper. What exactly does VeloCloud bring to the table for IT teams?

Tony:
Yeah, great question—and worth breaking down.

• Cloud-Native SD-WAN: VeloCloud was cloud-first from day one. It’s smart, it’s application-aware, and it talks directly to cloud providers through APIs.
• Gateway Architecture: Instead of forcing all traffic through edge devices, they use a global network of gateways. That means better performance for things like video calls—you know, the ones that always freeze right when you’re making a serious point.
• Security-Ready (SASE): While it’s not a full security stack like Zscaler, Velocloud has strong firewalling, segmentation, and plays nicely with other security solutions.
• AI and Automation: Their AI tools can predict congestion and reroute traffic before users even notice there’s a problem.

Larry:
So it’s not just SD-WAN—it’s intelligent and cloud-native SD-WAN.

Tony:
Yes, and that’s what made it so attractive to Arista.

Larry:
Okay, let’s talk about the good, the bad, and potential “gotchas” for enterprise customers.

Tony:

Lots of upside:

• Strong R&D Recommitment: Arista’s great at R&D, so expect faster innovation.
• Improved Lifecycle & Support: Under Broadcom, support was outsourced and strategic updates were vague. That’s going to change quickly.
• Better WAN-to-Cloud Integration: If you’re already using Arista in your data center or campus networks, the WAN-to-cloud integration gets you closer to unified policy control from edge to core.

Larry:

And the “gotcha” part?

Tony:

• I think the most likely “gotchas” would come from a roadmap shift.  That is, Arista may phase out certain appliance SKUs or smaller edge hardware.  There is also the chance that they decide on a shift to the licensing models or abandon features that you leverage in your environment today.
• On the security side, if you used Symantec or Broadcom’s security stack with VeloCloud, those integrations could break.
• And, like every acquisition ever, there’s the “integration dip”—things like support portals and upgrade cycles can get a little bumpy at first.

Larry:
Fair enough. So what about Cisco, Fortinet, and Juniper—how does this change the game for them?

Tony:
Oh, they’re definitely paying attention.

Cisco – Still the dominant SD-WAN player by volume (Catalyst & Meraki), but will now be under pressure to evolve more quickly. Enterprises want a modern control plane + AI + cloud-native experience. Arista will be selling CIOs on “simplified ops, not just boxes anymore.”

Fortinet – They’re the current market leader in “secure SD-WAN,” especially with firewall-centric buyers. But Arista’s more elegant WAN + AI model could attract cloud-first customers who want less box-heavy architecture.

Juniper (via Mist) – They’ve been leaning hard into AI and automation, but Arista just leapfrogged them with a full-stack platform from 5G/Wi-Fi 7 to datacenter AI fabrics and now multi-cloud SD-WAN.

Larry:
Tony, Any final thoughts—for CIOs, infrastructure architects, or enterprise network leaders—what’s the strategic takeaway here?

Tony:
Here’s what I’d say:

• Watch Arista closely. They’ve entered this space not as a follower—but as a platform integrator. Their execution in the next 6-12 months will be key.
• If you’re facing MPLS renewal decisions or an internet first transformation, this might be your window revisit your SD-WAN strategy.
• Remember that everything’s converging—SD-WAN, security, AI ops, telemetry. Arista’s acquisition of VeloCloud puts them right in the middle of that convergence.

Larry:
Thanks Tony – this has been a great discussion. 

To our listeners, if you would like to learn more about what Arista’s VeloCloud acquisition might mean for your enterprise WAN roadmap, or if you’d like to discuss other technology strategy, sourcing and cost reduction needs with Tony or me, or any of our LB3 and TC2 colleagues, please give us a call or shoot us an email.

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