The North American Optical Transport equipment market contracted 4 percent year-over-year (Y/Y) in 3Q 2023, according to a new report from Dell’Oro Group. This is in contrast to the market outside the North American region where demand improved for a third consecutive quarter, growing 6 percent Y/Y.
“The market dynamics are different in North America than other parts of the world because the supply chain and component crises resulted in a run for optical equipment,” said Jimmy Yu, Vice President at Dell’Oro Group. “Then when component supply improved, service providers started to receive more equipment than they needed, creating a pause in new orders and requests to move out deliveries into 2024. The market dynamics were different in other regions for varying reasons such as Covid policies slowing economic growth in some countries and a war in others. Hence, service providers in these countries did not build inventory in early 2023,” added Yu.
Additional highlights from the 3Q 2023 Optical Transport Quarterly Report:
- The worldwide Optical Transport market is projected to grow at an average annual rate of 3 percent, reaching $16 billion by 2024.
- The North American and Latin American regions declined Y/Y in 3Q 2023 due to a mixture of issues: excess inventory, worsening macro-conditions, fear of recession, and higher borrowing costs.
- Ciena, FiberHome, and Nokia each gained more than one percentage point of market share in the trailing four quarter period compared to a year ago.