Research firm IDC has released its latest report on Router and switch businesses and the share of top suppliers in Q4 2023.
The Ethernet switch revenues rose 20.1 percent in 2023 to $44.2 billion, IDC said in its report.
In the fourth quarter of 2023 (4Q23) the Ethernet switch market grew 0.8 percent.
The total enterprise and service provider (SP) router market revenue dropped 0.4 percent to $16.4 billion in 2023.
The router market declined 12.7 percent in 4Q23.
Ethernet Switch Market
Cisco’s Ethernet switch revenues rose 22.2 percent in 2023 but fell 12.1 percent in 4Q23. Non-DC revenues made up 69.5 percent of Cisco’s Ethernet switch revenues in 2023 and rose 28.6 percent for the full year but declined 12.8 percent in 4Q23. DC revenues made up the balance and rose 9.7 percent for the year but declined 10.6 percent in 4Q23. Cisco’s total Ethernet switch share stood at 43.7 percent for the full year 2023.
Arista Networks Ethernet switch revenues – 91.4 percent of which are in the DC segment – rose 35.2 percent in 2023 and grew 19.1 percent in 4Q23. Arista Networks has 11.1 percent share in Ethernet switch business in 2023.
Huawei’s total Ethernet switch revenue increased 10.6 percent in 2023 and 16.5 percent in 4Q23. Huawei has 9.4 percent share in Ethernet switch business in 2023.
HPE’s Ethernet switch revenue – 89.6 percent of which are in the non-DC segment – increased 67.6 percent in 2023 and rose 50.8 percent in 4Q23. HPE has 9.4 percent share in Ethernet switch business in 2023.
H3C’s Ethernet switch revenue declined 6.3 percent for the full year 2023, but rose 12.9 percent in 4Q23. H3C has 4.2 percent share in Ethernet switch business in 2023.
There were varying trends across the datacenter and non-datacenter portions of the Ethernet switch market. Revenues in the datacenter (DC) portion of the market rose 13.6 percent in 2023 and were up 4.4 percent in 4Q23. Datacenter Ethernet switching made up 41.5 percent of the total market’s revenues.
Revenues for 200/400 GbE switches rose 68.9 percent in 2023 in the datacenter segment and grew 14.8 percent between the third (3Q23) and fourth quarters of 2023. 100GbE switches, which make up 46.3 percent of the datacenter segment’s market revenues, rose 6.4 percent for the full year but dropped 3 percent sequentially from 3Q23 to 4Q23. ODM (original device manufacturer) Direct sales continue to be an important part of the datacenter segment, rising 16.2 percent in 2023 to make up 14.3 percent of the datacenter segment’s revenues for the full year.
The non-datacenter (non-DC) segment of the Ethernet switch market grew 25.2 percent in 2023, but dropped 1.9 percent in 4Q23.
The non-DC segment, which includes lower-speed switches that are deployed in enterprise campus and branch locations, saw mixed results by speed. 1GbE, which made up 56.5 percent of the segment’s revenues in 2023, rose 24.2 percent for the full year, but dropped 7 percent in 4Q23. 10GbE switches, which made up 20.4 percent of the non-DC segment’s revenues in 4Q23, rose 5.3 percent for the full year, but declined 6.1 percent in 4Q23.
“In the datacenter portion of the market, enterprises and service providers are building ever-faster Ethernet switch speeds to support rapidly maturing AI workloads. In the non-datacenter portion, Ethernet switch vendors are embedding AI capabilities in software management platforms to improve operations,” said Vijay Bhagavath, research vice president, Cloud and Datacenter Networks at IDC.
Router Market Highlights
The service provider segment of the router market, which includes both communications SPs and cloud SPs, made up 76.6 percent of total router market. Revenues for this segment grew 1.4 percent for the full year 2023 but dropped 10.6 percent in 4Q23. Revenues in the enterprise segment accounted for the remaining share of the market and declined 6.1 percent for the full year 2023 and declined 18.6 percent in 4Q23.
Cisco’s combined service provider and enterprise router revenue rose 1.4 percent for the full year 2023, but declined 22.9 percent in 4Q23. Cisco has a market share of 35.7 percent in router market in 2023.
Huawei’s combined SP and enterprise router revenue rose 2.6 percent in 2023 and was up 0.9 percent in 4Q23. Huawei has 29.2 percent market share in router market in 2023.
H3C’s revenues in the combined service provider and enterprise routing market fell 8.5 percent in 2023 and 9.8 percent in 4Q23. H3C has 2 market share in router market in 2023.
Baburajan Kizhakedath
