The worldwide Ethernet switch market grew revenues 31.5 per cent year over year in the first quarter of 2023 to $10 billion.
According to Beancounters at IDC the entire worldwide enterprise and service provider (SP) router market recorded $4.1 billion in revenue in 1Q23, a 14.1 per cent annual increase.
The Ethernet switch market’s growth of 31.5 per cent in 1Q23 builds on annualised growth of 3.3 per cent in 4Q22 and 19.4 per cent for the full year 2022. In 1Q23, the Ethernet switch market strengthened across the data and non-data centre segments. Revenues in the non-datacentre/enterprise campus and branch segment grew 38.7 per cent yearly, while port shipments rose 14.1 per cent. Revenues in the data center portion of the market rose 23.2 per cent year over year in the first quarter of 2023, while port shipments increased 19.7 per cent.
The higher-speed segments of the Ethernet switch market continue to see strong growth, driven by hyperscalers and cloud providers building out data centre network capacity. Market revenues for 200/400 GbE switches rose 141.3 per cent annually in 1Q23 and were up 14.3 per cent sequentially from 4Q22 to 1Q23. 100GbE revenues increased 18.2 per cent year over year in 1Q23. 25/50 GbE revenues increased 21.1 per cent 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 per cent year over year in 1Q23. 10GbE switches rose 9.7 per cent year over year in the quarter. 2.5/5GbE switch revenue – also known as multi-gigabit Ethernet switches – rose 128.0 per cent year over year in 1Q23.
IDC research manager Brandon Butler said the Ethernet switch market continued to show strong growth rates in the first quarter of 2023.
“One significant factor is the continued easing of component shortages, allowing vendors to recognise revenues from fulfilling backlogged product orders. Meanwhile, connectivity remains another important market driver as enterprises, service providers, and hyperscalers continue to deploy ever-faster Ethernet switching capacity to meet the demands of a digital-first world.”
The service provider segment, including communications and cloud SPs, accounted for 77.7 per cent of the market’s total revenues. The service provider segment of the market increased 13.1 per cent year over year in 1Q23.
Revenues in the enterprise segment account for the remaining market share and rose 17.6 per cent 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 per cent. In contrast, in the Asia/Pacific region (including China and Japan), the market rose 6.7 per cent. In the Europe, Middle East & Africa (EMEA) region, the market was up 1.3 per cent.
Cisco’s Ethernet switch revenues increased 33.7 per cent year over year in the first quarter, giving the company a market share of 46 per cent. Cisco’s combined service provider and enterprise router revenue grew 18.2 per cent in the quarter, giving the company a market share of 37.9 per cent in the first quarter.
Arista Networks saw Ethernet switch revenues increase 61.6 per cent year over year in the first quarter, giving the company an 11.4 per cent market share.
Huawei’s Ethernet switch revenue increased 5.5 per cent in the first quarter, giving the company a market share of 6 per cent. The company’s combined SP and enterprise router revenue rose 2.7 per cent, giving the company a market share of 23.6 per cent in the quarter.
HPE’s Ethernet switch revenue increased 54.9 per cent in the first quarter, resulting in a market share of 7 per cent
H3C’s Ethernet switch revenue declined 15 in the first quarter giving the company a market share of 3.6 per cent. In the combined service provider and enterprise routing market, H3C’s revenues decreased by 10.3 per cent in the first quarter, resulting in a market share of 1.6 per cent.
