Spending on Service Provider Routers declined sharply in the second quarter of 2024, resulting in a 33 percent year-over-year decline in router equipment revenue, according to a new report from Dell'Oro Group.
“The Service Provider Router market contracted for a fourth consecutive quarter due to customers pulling back on spending to lower equipment inventory,” said Jimmy Yu, Vice President at Dell’Oro Group. “The drop in quarterly revenue was one of the worst we have seen in this market for over a decade. The only silver lining to this quarter’s results is that we believe the inventory correction is nearly complete,” added Yu.
Additional highlights from the 2Q 2024 Service Provider Router and Switch Report:
- Breaking with historical seasonality where market revenue increases in the second calendar quarter over the first quarter, the Service Provider Router market declined quarter-over-quarter in 2Q 2024. The last time such an event occurred was in 2002.
- Among the service provider router technology segments, the steepest decline this quarter was in Core Router. Core Router revenue declined over 50 percent year-over-year.
- For the first half of the year, the top three vendors by revenue share were Cisco, Huawei, and Nokia. The only vendors in this market to gain more than one percentage point of revenue share compared to last year were Nokia and Huawei.
