Fortinet Emerges as #1 Vendor in Security Appliance Market Displacing Palo Alto Networks

Fortinet has emerged as the #1 vendor in the global security appliance market displacing Palo Alto Networks in the second quarter of 2023 (2Q23).
Share of Security Appliance vendors Q2 2023Fortinet has 21.3 percent share in the global security appliance market in Q2 2023 as compared with 19.1 percent share in Q2 2022.

The share of Palo Alto Networks has reached 21 percent in the global security appliance market in Q2 2023 as compared with 20.3 percent share in Q2 2022.

The other leaders in the security appliance market in Q2 2023 are Cisco (12.7 percent), Check Point (7.5 percent), and Huawei 3.4 percent).

Security Appliance Market Surges in 2Q23
Q2 2023 Security Appliance Market IDC reportIn the latest report from International Data Corporation (IDC) Worldwide Quarterly Security Appliance Tracker, the global security appliance market exhibited remarkable growth, with total market revenue reaching over $4.2 billion in the second quarter of 2023 (2Q23). This figure represents a substantial year-over-year increase of 7.6 percent, amounting to a $298 million boost when compared to the same period in 2022. Additionally, security appliance shipments surged by an impressive 22.0 percent year over year, reaching a total of 1.1 million units during the second quarter.

IDC’s findings reflect a recent revision to its Security Appliances classification, which took effect in the first quarter of 2023. This update involved resizing the market by excluding revenues associated with software and services that do not qualify for reporting within the new hardware-focused market view. Consequently, the 2Q23 Security Appliance Tracker release introduces fresh metrics, including Vendor Revenue (new hardware revenue) and Renewals/Firmware update revenue, which were introduced in the previous cycle, 1Q23. The figure “Total Market Revenue” will now serve as the basis for calculating market share going forward.

The growth of the overall security appliance market in 2Q23 was primarily driven by the strong performance of the combined Unified Threat Management (UTM) and Firewall sectors, which witnessed a remarkable revenue increase of 9.7 percent compared to 2Q22. The Intrusion Prevention Systems (IPS) market also displayed positive growth, recording a 2.3 percent year-over-year increase. However, the Content Management and Virtual Private Networks (VPN) segments both experienced single-digit year-over-year declines during the quarter.

Carlo Davila, Research Manager at IDC’s Enterprise Trackers, noted that supply chain constraints, which have impacted hardware-based markets, continue to improve. He expects the Security Appliance market to maintain a healthy growth rate in the coming years, emphasizing the enduring importance of hardware-based security platforms in customers’ cybersecurity investment strategies.

Regional Highlights

From a regional perspective, the Europe, Middle East, and Africa (EMEA) region emerged as a standout performer in the second quarter of 2023, posting an impressive revenue growth of 11.8 percent compared to the same quarter in 2022. Meanwhile, the Americas region also displayed strong growth, with a 10.3 percent increase, driven by an 8.6 percent surge in the United States and exceptional results in Canada and Latin America, both of which exhibited growth rates exceeding 20 percent in the second quarter.

These robust regional performances underscore the global expansion and significance of the security appliance market as organizations worldwide continue to prioritize cybersecurity in an increasingly digital and interconnected landscape.