European operators resumed purchases of optical and packet transport hardware in 3Q20 as COVID-related supply chain and operational delays eased, according to the most recent Transport Hardware Report from research firm Cignal AI. At the same time, North American spending weakness spread to the optical hardware segment as the region’s operators paused capex after aggressive deployments in the first half of the year.
“EMEA’s packet and optical transport sales growth was bolstered by sales deferred from Q2 and raised the market overall during the third quarter,” said Scott Wilkinson, Transport Hardware lead analyst at Cignal AI. “The outcome was different in North America, where sales were more frontloaded in the first two quarters than in EMEA, especially by the larger operators. NA annual CapEx budgets are largely exhausted, producing declining sales in the second half of the year for this region.”
Highlights:
- Optical hardware spending grew by double-digits in EMEA, countering expectations of a flat-to-down quarter in optical spending. Nokia led the robust growth with a boost from sales deferred from Q2. Worldwide, optical hardware spending was up slightly.
- Packet transport hardware spending also rose in EMEA but declined worldwide. EMEA packet transport revenue for both Huawei and Juniper grew by more than 20% YoY as the two companies gained ground on market leaders Cisco and Nokia.
- North American optical and packet spending declined this quarter, as anticipated by vendors (Ciena, Cisco) with exposure to large network operators. Ciena continues to lead optical market share with slight YoY revenue growth, while Cisco maintains packet transport market leadership despite a sharp YoY revenue decline.
https://cignal.ai/2020/11/emea-optical-and-packet-transport-spending-bounces-back-in-3q20/