The party is still on for the campus switch market as vendors fulfill backlogs

According to a recent report by Dell’Oro Group, the trusted source for information about the telecommunications, security, networks, and data center industries, 3Q 2023 worldwide Campus Switch sales surged by 24 percent year-over-year (Y/Y), marking the fifth consecutive quarter of over 20 percent growth in this market and reaching record levels. This achievement is remarkable given the market’s historical mid-to-high single-digit growth rate prior to the pandemic. Several vendors including Arista, Cisco, CommScope, Extreme, HPE Aruba, and Juniper experienced a robust increase in sales but HPE grew the fastest; gaining more than three points of revenue share during the quarter.

“The market continues to showcase impressive growth, reflecting primarily backlog fulfillment as the supply environment continues to improve and lead times continue to shrink,” said Sameh Boujelbene, Vice President at Dell’Oro Group. “We would like to note, however, that despite this improvement in supply that facilitated the ongoing release of backlog, total port shipments declined, marking a departure from five consecutive quarters of growth. Most of the decline originated from products and customer segments that were early to receive their orders and therefore were the first to be hit by a pause and a “digestion” phase. That is the case of the 1 Gbps port speeds as well as fixed switch form factors. In the meantime, we saw impressive growth in the higher priced 2.5/5.0 Gbps products as well as modular switches. This shift to a richer product mix resulted in higher prices that were able to more than offset the decline in total port shipments and resulted in ongoing growth in sales during the quarter,” added Boujelbene.

Additional highlights from the 3Q 2023 Ethernet Switch – Campus Report:

• Double-digit sales growth was broad-based across all regions, except China, which declined 8 percent in 3Q 2023.
• 2.5/5.0 Gbps ports more than tripled Y/Y in 3Q 2023. This surge underscores significant improvements in supply, coupled with rising demand stimulated by the increasing adoption of Wi-Fi 6E Access Points (APs).

Dell’Oro