08 Jun 2022
Worldwide Ethernet Switch Revenues Increased 12.7% Year Over Year in the First Quarter of 2022 While Router Market Revenues Increased 3.5%, According to IDC
NEEDHAM, Mass., June 8, 2022 – The worldwide Ethernet switch market grew 12.7% year over year in the first quarter of 2022 (1Q22) with revenues of $7.6 billion. The total worldwide enterprise and service provider (SP) router market recorded $3.6 billion in revenue in 1Q22, a 3.5% increase year over year. These growth rates are according to results published in the International Data Corporation (IDC) Worldwide Quarterly Ethernet Switch Tracker and Worldwide Quarterly Router Tracker.
Ethernet Switch Market Highlights
IDC's Worldwide Ethernet Switch Tracker segments the market by two major categories: datacenter switching and non-datacenter switching. Non-datacenter switching includes Ethernet switch deployments in the enterprise campus and branch. Revenues in this segment make up 53.7% of the total market and grew 6.4% year over year in 1Q22, while port shipments increased 4.7% year over year. Revenues for the datacenter portion of the Ethernet switch market make up the balance of the total market. Revenues in the datacenter segment rose 20.8% on an annual basis in 1Q22, while port shipments increased 3.7%.
The higher-speed segments of the Ethernet switch market continue to see significant growth, driven by hyperscalers and cloud providers. Market revenues for 200/400 GbE switches grew 35.6% from the fourth quarter of 2021 to the first quarter of 2022, with port shipments increasing 78.6% on a sequential basis. 100GbE revenues increased 22.4% year over year in 1Q22, while port shipments rose 26.1% year over year. 100GbE switch sales account for 26.7% of the market's total revenues. 25/50 GbE revenues increased 38.0% compared to the first quarter of 2021 while port shipments declined 5.1%.
Lower-speed switches, a more mature part of the market, saw moderate growth. 1GbE switches make up 31.4% of the total market's revenues and revenues in this speed rose 1.2% year over year in 1Q22 with port shipments increasing 4.3%. 10GbE, which make up 19.5% of the total market's revenues, declined 5.7% in the quarter, while port shipments grew 5.7% year over year. 2.5/5GbE switch revenue – also known as multi-gigabit Ethernet switches – were flat, with 0.5% change from 4Q21 to 1Q22, but port shipments rose 21.5% sequentially.
"Despite persistent and manifold supply-chain challenges – compounded by macroeconomic concerns and geopolitical conflicts and uncertainty – the worldwide Ethernet switch market demonstrated notable resilience and robustness in the first quarter of 2022," said Brad Casemore, research vice president, Datacenter and Multicloud Networking at IDC. "Organizations across geographies and industries recognize that the network is the digital nervous system of modern IT infrastructure, and they are investing accordingly. The continued expansion of datacenter switching capacity by hyperscalers and other major cloud providers, as well as a healthy refresh cycle in the enterprise campus and branch, has provided a steady impetus for growth."
From a geographic perspective, the Ethernet switch market experienced growth in most regions in 1Q22. In the United States, Ethernet switch market revenues rose 17.9% year over year. The market in Latin America grew 5.6% annually in the quarter and Canada's market increased 14.9%. In Asia/Pacific (excluding Japan and China) (APeJC), the market rose 8.8% year over year. In the People's Republic of China (PRC), the market rose 22.8% while in Japan, the market declined 17.9%. In Western Europe, Ethernet switch market revenues grew 11.7% annually while in Central and Eastern Europe, the market grew 9.0%. The market in the Middle East and Africa region rose 2.6% year over year. The IDC Worldwide Ethernet Switch Tracker includes country-level detail as well. For example, Russia is still the largest market in the Central and Eastern Europe region, making up 23.6% of the region's revenues – down from 34.9% in full year 2021. The Russia market declined 33.6% year over year in 1Q22.
Router Market Highlights
Total revenue in the worldwide enterprise and service provider router market increased 3.5% year over year in 1Q22. The service provider segment, which includes both communications SPs and cloud SPs, accounted for 78.4% of revenues and this segment of the market increased 4.5% year over year. Revenues in the enterprise segment were essentially flat with a 0.1% increase from a year earlier.
From a regional perspective, the combined service provider and enterprise router market in 1Q22 fell 12.7% in the APeJC region. Japan's market declined 5.4% while the People's Republic of China market was up 4.6% year over year. Revenues in Western Europe increased 6.8% year over year, while the Central and Eastern Europe combined enterprise and service provider market declined 16.9% annually and the Middle East & Africa region increased 2.7%. In the U.S., the enterprise segment decreased 3.0%, while the service provider revenues increased 14.7%, giving the combined markets a 10.8% increase on an annualized basis. The Latin American market grew 20.7% on an annualized basis and Canada's market declined 5.8%.
Cisco's Ethernet switch revenues increased 3.8% year over year in 1Q22, giving the company market share of 45.4%. Meanwhile, Cisco's combined service provider and enterprise router revenue grew 1.3% in the quarter. Cisco's combined SP and enterprise router market share stood at 36.6% in 1Q22.
Huawei's Ethernet switch revenue increased 7.2% in 1Q22, giving the company market share of 7.5%. The company's combined SP and enterprise router revenue increased 6.7% year over year, resulting in a market share of 26.2%.
Arista Networks saw Ethernet switch revenues increase 33.5% in 1Q22, giving the company 9.3% market share in the quarter.
H3C's Ethernet switch revenue increased 25.3% in 1Q22, giving the company market share of 5.6%. In the combined service provider and enterprise routing market, H3C's revenues rose 9.4% in the quarter, giving the company 2.0% market share for 2021.
HPE's Ethernet switch revenue increased11.4% in the quarter, resulting in market share of 6.0% in the quarter.
The Worldwide Quarterly Ethernet Switch Tracker and Worldwide Quarterly Router Tracker provide total market size and vendor shares for the Ethernet switch and router technologies in an easy-to-use Excel pivot table format. The geographic coverage for both the Ethernet switch market and the router market includes nine major regions (USA, Canada, Latin America, People's Republic of China, Asia/Pacific (excluding Japan & China), Japan, Western Europe, Central and Eastern Europe, and Middle East and Africa) and 60 countries. The Ethernet switch market is further segmented by speed (100Mb, 1000Mb, 2.5Gb/5Gb, 10Gb, 25Gb/50Gb, 40Gb, 100Gb, 200Gb/400Gb), product (fixed managed, fixed unmanaged, modular), and layer (Ethernet switch, ADC). Measurement for the Ethernet switch market is provided in vendor revenue, value, and port shipments. The router market is further split by product (high-end, mid-range, low-end, SOHO), deployment (service provider, enterprise), connectivity (core, edge), and the measurements are in vendor revenue, value, and unit shipments.
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