The worldwide Ethernet switch market (Layer 2/3) recorded $6.29 billion in revenue in the third quarter of 2016 (3Q16), an increase of 2.0% year over year, and the worldwide total enterprise and service provider (SP) router market finished at $3.56 billion in revenue in 3Q16, increasing 2.6% on a year over year basis, according to IDC's Worldwide Quarterly Ethernet Switch Tracker and Worldwide Quarterly Router Tracker.
"Recent macroeconomic developments and maturing IT architectures have led to a spectrum of reactions by IT decision-makers across the regions with regard to Ethernet switching investments in 3Q16," said Rohit Mehra, vice president, Network Infrastructure, at IDC. "Strong growth in the 40GbE and 100GbE segments specific to datacenter deployments brought a degree of stabilization to a market in transition where the enterprise campus market for switching declined."
Some highlights:
- 10Gb Ethernet switch (Layer 2/3) decreased 1.3% year over year in 3Q16, coming in at $2.22 billion, while 10Gb Ethernet switch port shipments grew 10.6% year over year with over 9.76 million ports shipped in 3Q16.
- 40Gb Ethernet revenue came in at $756.4 million in 3Q16, growing 20.5% year over year, while port shipments reached nearly 1.9 million ports, representing an increase of 68.5% year over year. 10Gb and 40Gb Ethernet are now joined by emerging 100Gb Ethernet (revenue up 330.1% and shipments up 447.5% on annualized basis in 3Q16) to be the primary drivers of the overall Ethernet switch market in 2016.
- 1Gb Ethernet switch revenue decreased 4.3% year over year, despite a 10.9% increase in port shipments in the same period, pointing to a maturing campus segment.
- The worldwide enterprise and service provider router market grew 2.6% on a year-over-year basis in 3Q16 based on a 0.8% increase in the larger service provider segment and a solid 8.2% increase in enterprise routing. T
- Cisco finished the quarter with a 5.4% year-over-year decline in the Ethernet switching market and market share of 57.0%, up from its 56.8% share in 2Q16 but down from 61.5% in 3Q15.
- In the hotly contested 10GbE segment, Cisco held 53.5% of the market in 3Q16, up from 53.0% in the previous quarter.
- Cisco saw its combined service provider and enterprise router revenue decrease 4.8% on an annualized basis, while its market share came in at 44.2% in 3Q16, down from 44.8% in 2Q16.
- Huawei's Ethernet switch revenue grew 91.6% year over year in 3Q16, for a market share of 7.2%.
- Huawei's enterprise and service provider router revenue increased 23.8% over the same period, with 16.6% of the total router market in 3Q16.
- Hewlett Packard Enterprise's (HPE) Ethernet switch revenue fell 4.3% quarter over quarter in 3Q16. HPE's market share stands at 5.5% in 3Q16, down from its 6.0% share in 2Q16. (Note: HPE and H3C are tracked separately as of 2Q16).
- Juniper Ethernet switching increased 7.1% quarter over quarter in 3Q16. Juniper also saw a 5.9% increase year over year in combined service provider and enterprise router revenues, with market share of 17.4%.
- Arista Networks' Ethernet switching revenue rose 31.5% year over year.
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