The ethernet switch market has grown 12% year over year, fueled by data centre and campus upgrades, with Europe among the fastest growing regions. Worldwide Ethernet switch revenue totaled $6.1bn in the first quarter of 2018 (Q1 2018), growing 12% on a year-over-year basis, says researcher IHS Markit.
100GE continued to ramp, increasing more than twofold year over year and reaching 1.7 million ports in the quarter; 40GE ports were flat year over year. Number-one Cisco grew 7% year over year, number-two Huawei rose 43%, number-three HPE (Aruba) was up 2% and number-four Arista grew 40%
Overall, ethernet switch revenue declined 10% sequentially in Q1 2018 due to a seasonal slowdown in demand, but the longer-term growth outlook remains positive and strengthened further during the quarter, with year-over-year growth hitting 12%, up from 7% the previous quarter, says the researcher.
The market enjoyed its strongest growth in seven years in 2017, and the momentum continued into 2018, fueled by continuing data centre upgrades and expansion, as well as growing demand for campus gear due to improving economic conditions. The transition to 25/100GE architectures in the data center is in full swing, driving strong gains in 25GE, 100GE and white box shipments. And power over Ethernet is growing once again, a sign of strengthening campus switching demand.
Growth is well balanced around the globe and not driven by any single geography. In Q1 2018, Europe, the Middle East and Africa (EMEA) and Asia Pacific were the top growth markets, increasing 15 and 16%, respectively, year over year, while growth in North America remained solid at 8%.
IHS Markit forecasts low- to mid-single-digit growth for the Ethernet switching market from 2019 to 2022. The bright spots will be the 10GE, 25GE, 100GE, 200GE and 400GE segments, where significant growth is expected over the next few years.
