IDC’s Worldwide Quarterly Ethernet Switch and Router Trackers Show Strong Growth in the Fourth Quarter and Full Year 2018

Worldwide Ethernet Switch Market Increased 12.7% Year Over Year in
Fourth Quarter of 2018; Router Market Rebounds, Up 15.6%

FRAMINGHAM, Mass.–(BUSINESS WIRE)–lt;a href=”https://twitter.com/hashtag/Ethernet?src=hash” target=”_blank”gt;#Ethernetlt;/agt;–The worldwide Ethernet switch market (Layer 2/3) recorded $7.8 billion
in revenue in the fourth quarter of 2018 (4Q18), an increase of 12.7%
year over year. For the full year 2018, the market recorded $28.1
billion in revenue for a year-over-year growth rate of 9.1%. Meanwhile,
the worldwide total enterprise and service provider router market
recorded $4.6 billion in revenue in 4Q18, increasing 15.6% on a
year-over-year basis. For the full year 2018, the router market finished
at $15.5 billion, an increase of 1.8% over 2017. These results are
according to the International Data Corporation (IDC)
Worldwide
Quarterly Ethernet Switch Tracker
and Worldwide
Quarterly Router Tracker
.

Ethernet Switch Market Highlights

From a geographic perspective, the 4Q18 Ethernet switch market recorded
strong growth in the Middle East & Africa region, which rose 15.7% year
over year in 4Q18 and rose 10.6% in 2018 compared to 2017. Saudi Arabia
rose 44.8% year over year in the quarter and was up 15.8% on the year.
The Central & Eastern European region rose 14.9% year over year in 4Q18
and was up 12.6% on the full year. Russia’s market grew 18.1% in 4Q18
and 18.6% for the full year. The Asia/Pacific (excluding Japan) (APeJ)
region increased 10.5% year over year in 4Q18 and grew 15.5% for the
full year 2018. The People’s Republic of China, which makes up the
largest share of the region’s total, rose 7.8% in 4Q18 and was up 18.5%
for the full year. Japan grew 3.3% year over year in the quarter and
2.2% for the full year.

In the Western Europe region, the Ethernet switching market grew 12.1%
year over year in 4Q18 and 9.1% for 2018. The Netherlands grew 20.4% in
4Q18 and 9.6% for the full year. The Latin America region grew 4.4% in
the quarter and rose 1.4% for the full year. Brazil helped power the
region’s growth with a 12.8% year-over-year gain in the quarter and a
10.2% full-year increase. Canada’s market grew 9.6% in the quarter and
9.0% for the full year. In the United States, revenues rose 3.6% in 4Q18
compared to 3Q18, but jumped up 15.9% year over year, driving annual
revenues 6.6% higher in 2018 vs. 2017.

“The Ethernet switching market saw solid growth around the world, driven
by investments in both mature and emerging countries, indicating the
strong demand for network infrastructure that powers enterprise Digital
Transformation efforts,” said Rohit
Mehra
, vice president, Network
Infrastructure
at IDC. “The market’s strong fourth quarter helped
push full year gains in Ethernet switching and sets the market up for
continued strength in 2019, creating opportunities for vendors to
capitalize on around the globe.”

100Gb Ethernet switch revenue continues to grow rapidly as adoption by
hyperscale cloud providers and large enterprises accelerates. 100GbE
shipments reached more than 3.8 million ports and $1.1 billion in
revenue in 4Q18. 100GbE shipments accounted for 13.6% of the full year’s
Ethernet switching revenue compared to 8.5% in 2017. 25Gb Ethernet
switch products continue to see strong growth with port shipments rising
14.8% sequentially to 3.0 million and $293.5 million in revenue in 4Q18.
The 10GbE market continues to see healthy growth but pricing pressure is
holding back revenue increases. 10Gb port shipments in 4Q18 grew 14.6%
year over year while revenues decreased 1.6%. 10GbE made up 30.6% of all
2018 Ethernet switching revenues. Meanwhile, 1Gb remains the primary
connectivity technology for enterprise campus and branch deployments,
driving 1Gb port shipments to 128.3 million in 4Q18, growing 12.7% year
over year and making up 68.8% share of all ports shipped. 1GbE
represented 41.8% of 2018 Ethernet switching revenues.

Router Market Highlights

The worldwide enterprise and service provider router market grew 24.2%
sequentially and 15.6% year over year in 4Q18 with the larger service
provider segment rising 20.3% and the enterprise portion growing 2.2%.
For the full year, the combined market increased 1.8% with the service
provider segment driving 2.0% growth and the enterprise segment growing
1.2%.

The combined enterprise and service provider router market saw growth
around the world, with APeJ growing 22.4% year over year in 4Q18 and up
13.6% for the full year. Middle East & Africa increased 17.6% year over
year and 9.2% annually. The U.S., which is the largest worldwide market,
was up 12.4% year over year but down 11.1% for the full year. Western
Europe rose 12.9% year over year in 4Q18 and was up 4.9% for the full
year.

Company Highlights

Cisco finished 4Q18 with a 13.2% year over year increase in
Ethernet switching revenues and market share of 53.2%. For the full year
2018, Cisco switching revenues rose 5.2% over 2017 while recording 52.8%
market share (compared to 54.8% in 2017). In the hotly-contested 10GbE
segment, Cisco remains the market leader, earning 48.5% of 10Gb revenues
in 4Q18. Cisco’s combined service provider and enterprise router revenue
increased 17.9% year over year in 4Q18, but was off 2.7% for the full
year, giving the company 38.8% share in 2018.

Huawei‘s Ethernet switch revenue grew 6.0% year over year in 4Q18
for a market share of 9.7%. For the full year 2018, Huawei’s Ethernet
switch revenues grew 20.2%. Huawei’s enterprise and service provider
router revenue increased 35.1% year over year in 4Q18 and rose 22.5% for
the full year, giving the company 28.7% market share in 2018.

Arista Networks’ Ethernet switching revenue rose 23.6% year over
year and 28.5% in 2018. 100GbE revenues for Arista rose 6.6%
sequentially in 4Q18 and were up 69.4% on the full year. Arista’s market
share stood at 6.5% to end 2018, compared to 5.6% at the end of 2017.

Hewlett Packard Enterprise (HPE) revenues rose 20.2% year over
year in 4Q18. That led to a 16.5% year over year increase in 2018,
putting the company’s full year market share at 6.1% compared to 5.7%
for 2017.

Juniper‘s Ethernet switch revenues declined 2.0% year over year
in 4Q18 and were off 3.1% for the full year. Juniper’s router revenues
declined 12.7% year over year. The company finished 2018 with 14.7%
market share in the service provider routing market, down from 18.0% in
2017.

A graphic illustrating worldwide revenue for the top 5 Ethernet switch
companies over the previous five quarters is available by viewing this
press release on IDC.com
.

The Worldwide
Quarterly Ethernet Switch Tracker
and the 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 eight major regions (USA, Canada,
Latin America, Asia/Pacific (excluding Japan), 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, 10Gb, 25Gb, 40Gb, 50Gb, 100Gb), product (fixed managed,
fixed unmanaged, modular), and layer (L2, L3, 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.

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.

About IDC

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more than 1,100 analysts worldwide, IDC offers global, regional, and
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Contacts

Rohit Mehra
rmehra@idc.com
416-616-4343

Petr
Jirovský
pjirovsky@idc.com
413-313-6112

Michael
Shirer
press@idc.com
508-935-4200

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