High End Router equipment revenue declined for a fifth consecutive quarter in 3Q 2024, according to a new report from Dell’Oro Group. Nokia was the only manufacturer to post higher router revenues in the quarter on a year-over-year basis. As a result, Nokia gained five percentage points of market share.
“The market contraction that the router vendors are undergoing is in its fifth quarter,” said Jimmy Yu, Vice President at Dell’Oro Group. “We anticipate that as the market stabilizes and customer inventory levels return to normal, vendors will experience higher order flows, followed by increased revenues. Nokia seems to be the first vendor to exit the correction phase, growing their High End Router revenues by nearly 10 percent,” added Yu.
Additional highlights from the 3Q 2024 Service Provider Router and Switch Report:
- For a third consecutive quarter, the highest decline was in Core Routers. However, on a positive note, Core Router revenue was stable on a quarter-over-quarter basis.
- The High End Router market contraction was across all geographies, with the steepest decline occurring in North America due to excess customer inventory. In 3Q 2024, the North American region declined 24 percent year-over-year.
- For the first nine months of the year, the top three High End Router vendors by revenue share were Huawei, Cisco, and Nokia. Cisco’s market share is six percentage points lower, while Huawei’s and Nokia’s are two and three percentage points higher, respectively.
- The High End Router market is projected to recover in 2025, growing 4 percent, with the conclusion of the inventory correction and better market conditions that include lower interest rates, normal rates of inflation, and economic growth.
