Switch and router sales surge, with 200/400 gigabit Ethernet kit growing fastest

Clouds are buying plenty, but there's lots of product left for the rest of us – outside Russia

Major networking vendors continue to report supply chain challenges, but the market for their switches and routers is growing at quite a clip according to analyst outfit IDC.

The company's Worldwide Quarterly Ethernet Switch Tracker and Worldwide Quarterly Router Tracker both report robust growth during the second quarter of 2022.

Ethernet switch sales topped $8.6 billion, representing annualized growth of 14.6 compared to the same period in 2021. That's real growth – not a spike after a COVID-caused slump – because sector growth for the sector in 2021 was 10.8 percent year over year.

Datacenters delivered the result, with IDC's numbers suggesting 26.9 percent year over year revenue growth and port shipments increasing by 11.7 percent.

Revenues in the non-datacenter segment of the Ethernet switch market – which includes Ethernet switch deployments in the enterprise campus and branch – grew 5.8 percent year over year, while port shipments decreased 0.4 percent year over year. The other segment IDC measures – enterprise campus and branches – grew revenue just 5.8 percent year over year and saw port shipments decrease by 0.4 percent.

Hyperscalers and cloud providers drove demand for 200/400 gigabit switches, sales of which grew 67.4 percent while port shipments jumped 89.5 per cent. Might 200/400 gigabit Ethernet be heading to the mainstream?

100 gigabit revenues increased 28.3 percent and port shipments popped 23.4 per cent year over year and delivered 26.2 percent of market revenue. Ye olde 25/50 gigabit Ethernet also racked up a nice result of 22.1 per cent year over year revenue growth.

Router sales produced less impressive results, with product aimed at service providers growing 2.2 percent and enterprise sales rising 20.2 percent from a year earlier.

IDC's outline of its numbers is silent on whether inflation is the reason for revenue growth, but the firm's research vice president for cloud and datacenter networks, Brad Casemore, said the results are notable given headwinds occasioned by supply-chain disruptions, rising inflation, and the ongoing war in Ukraine.

He attributed the growth to "hyperscalers and other cloud service providers are adding switches to keep pace with robust demand from customers for popular applications and services" and businesses conducting digital transformation projects.

Cisco's Ethernet switch revenues increased 10.2 percent to leave it with 42.3 percent market share. Arista was the fastest mover, with 55.1 percent revenue growth driving it to 10.1 percent market share.

The US switch market grew fastest, at 23.3 percent, ahead of Latin America's 18.8 percent and Western Europe's 14 percent. Russia’s market slumped 89.2 percent. ®

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