IDC's Worldwide Quarterly Ethernet Switch Tracker Shows Strong Market Growth Continuing in First Quarter of 2023

Contact

For more information, contact:

• Petr Jirovsky  Email: pjirovsky@idc.com  Phone number: 413-313-6112
• Brandon Butler  Email: bbutler@idc.com  Phone number: 508-935-4325
• Michael Shirer  Email: press@idc.com  Phone number: 508-935-5200

Worldwide Ethernet Switch Market Increased 31.5% Year Over Year in First Quarter of 2023; Router Market increased 14.1% in 1Q23

NEEDHAM, Mass., June 13, 2023 – The worldwide Ethernet switch market grew revenues 31.5% year over year in the first quarter of 2023 (1Q23) to $10 billion. The total worldwide enterprise and service provider (SP) router market recorded $4.1 billion in revenue in 1Q23, a 14.1% annual increase. 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

The Ethernet switch market's growth of 31.5% in 1Q23 builds on annualized growth of 3.3% in 4Q22 and 19.4% for the full year 2022. In 1Q23, the Ethernet switch market showed strength across both the datacenter and non-datacenter segments of the market. Revenues in the non-datacenter/enterprise campus and branch segment grew 38.7% year over year, while port shipments rose 14.1%. Revenues in the datacenter portion of the market rose 23.2% year over year in 1Q23, while port shipments increased 19.7%.

The higher-speed segments of the Ethernet switch market continue to see strong growth, driven by hyperscalers and cloud providers building out datacenter network capacity. Market revenues for 200/400 GbE switches rose 141.3% annually in 1Q23 and were up 14.3% sequentially from 4Q22 to 1Q23. 100GbE revenues increased 18.2% year over year in 1Q23. 25/50 GbE revenues increased 21.1% in 1Q23.

Lower-speed switches, which are typically deployed in enterprise campus and branch locations, showed strength too. Revenues for 1GbE switches rose 43.7% year over year in 1Q23. 10GbE switches rose 9.7% year over year in the quarter. 2.5/5GbE switch revenue – also known as multi-gigabit Ethernet switches – rose 128.0% year over year in 1Q23.

From a geographic perspective, the Ethernet switch market saw growth in most regions of the world. In the Asia/Pacific region (excluding Japan and China), the market grew 31.8% year over year, but in the People's Republic of China, the market fell 5.0%. In the United States, the market rose 40.3% while Canada's market increased 39.1% year over year. The Latin America market rose 65.3% in the quarter. In Western Europe, the market rose 36.1% annually while in Central and Eastern Europe the market increased 16.4%. The Middle East & Africa region saw market growth of 40.4% in the quarter.

"The Ethernet switch market continued to show strong growth rates in the first quarter of 2023, driven by a variety of factors," noted Brandon Butler, research manager, Enterprise Networks at IDC. "One significant factor is the continued easing of component shortages, which is allowing vendors to recognize revenues from fulfilling backlogged product orders. Meanwhile, connectivity remains another important market driver as enterprise, service providers, and hyperscalers continue to deploy ever-faster Ethernet switching capacity to meet the demands of a digital-first world."

Router Market Highlights

The service provider segment, which includes both communications SPs and cloud SPs, accounted for 77.7% of the market's total revenues. The service provider segment of the market increased 13.1% year over year in 1Q23. Revenues in the enterprise segment account for the remaining share of the market and rose 17.6% compared to the first quarter of 2022. From a regional perspective, the combined service provider and enterprise router market in the Americas rose 30.4%, while in the Asia/Pacific region (including China and Japan), the market rose 6.7%. In the Europe, Middle East & Africa (EMEA) region, the market was up 1.3%.

Vendor Highlights

Cisco's Ethernet switch revenues increased 33.7% year over year in 1Q23, giving the company a market share of 46.0%. Cisco's combined service provider and enterprise router revenue grew 18.2% in the quarter, giving the company a market share of 37.9% in 1Q23.

Arista Networks saw Ethernet switch revenues increase 61.6% year over year in 1Q23, giving the company 11.4% market share.

Huawei's Ethernet switch revenue increased 5.5% in 1Q23, giving the company a market share of 6.0%. The company's combined SP and enterprise router revenue rose 2.7%, giving the company a market share of 23.6% in the quarter.

HPE's Ethernet switch revenue increased 54.9% in 1Q23, resulting in a market share of 7.0%.

H3C's Ethernet switch revenue declined 15.0% year over year 1Q23, giving the company a market share of 3.6%. In the combined service provider and enterprise routing market, H3C's revenues decreased 10.3% in 1Q23, resulting in a market share of 1.6%.

About IDC Trackers

IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly Excel deliverables and online query tools.

Click here to learn about IDC's full suite of data products and how you can leverage them to grow your business.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,300 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC Blog for industry news and insights.

Coverage