Data Center Switch Revenue Plunged in Q1, Says Dell’Oro Group

The worldwide data center switch market recorded its first decline in nine years, dropping 9 percent year-over-year in the first quarter, according to a recent report by Dell’Oro Group. The Q1 2020 revenue level was also the lowest in three years.

Sameh Boujelbene
“The COVID-19 pandemic has created some positive impact on the data center switch market as some customers pulled in orders in anticipation of supply shortage and elongated lead times,” said Sameh Boujelbene, Senior Director at Dell’Oro Group.

The softness was broad-based across all major branded vendors, except Juniper Networks and white box vendors. Revenue from white box vendors was propelled mainly by strong demand from Google and Amazon.

“The COVID-19 pandemic has created some positive impact on the market as some customers pulled in orders in anticipation of supply shortage and elongated lead times,” said Sameh Boujelbene, Senior Director at Dell’Oro Group.

“Yet this upside dynamic was more than offset by the pandemic’s more pronounced negative impact on customer demand as they paused purchases due to macro-economic uncertainties. Supply constraints were not major headwinds during the first quarter but expected to become more apparent in the next quarter.”

 

Additional highlights from Dell’Oro’s Q1 2020 Ethernet Switch – Data Center Report include:

  • The revenue decline was broad-based across all regions but was less pronounced in North America.
  • Dell’Oro expects revenue in the market to decline high single-digit in 2020, despite some pockets of strength from certain segments.

About the Report


Dell'Oro GroupThe Dell’Oro Group Ethernet Switch – Data Center Quarterly Report would offer a detailed view of the market, including Ethernet switches for server access, server aggregation, and data center core. (Software is addressed separately.) The report contains in-depth market and vendor-level information on manufacturers’ revenue; ports shipped; average selling prices for both Modular and Fixed Managed and Unmanaged Ethernet Switches (1000 Mbps,10, 25, 40, 50, 100, 200, and 400 GE); and regional breakouts.