The Q4 2022 Ethernet switch market demonstrated strong growth, driven by multiple factors including the ongoing reduction in supply chain disruptions and component shortages.
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Additionally, this growth was accompanied by increased capacity for Ethernet switching among service providers, enterprises, and hyperscalers, indicating the growing significance of network infrastructure and connectivity in today's business landscape. According to IDC, global Ethernet switch revenues rose by 22.0% YoY in Q4 2022, reaching $10.3 billion, while full-year growth reached 18.7% at $36.5 billion. Conversely, the worldwide enterprise and service provider router market only saw a modest 0.7% YoY revenue increase in Q4 2022, earning $4.6 billion.
In the Ethernet switch market, both the data center and non-datacenter segments experienced robust growth in Q4 2022 with higher revenue and port shipment growth. Non-datacenter Ethernet switch revenues grew by 15.7% for the entire year, with port shipments increasing by 12.2%, while data center Ethernet switch revenues rose by 22.6% YoY with port shipments rising by 12.2%. The higher-speed Ethernet switch market, driven by cloud providers and hyperscalers' investments, also grew significantly, with revenues for 200/400 GbE switches surging by over 300% for the entire year. Meanwhile, lower-speed switches also exhibited strength, with 1GbE switch revenues growing by 21.4% YoY in Q4 2022 and 12.6% for the entire year.
Overall, most regions around the world witnessed growth in the Ethernet switch market except for Japan and Central and Eastern Europe, which saw declines in Q4 2022.
The Ethernet switch market experienced annual growth of 14.6%, following a successful Q1 that saw YoY growth of 12.7% and 13.7% YoY in H1 . In Q2, revenue outside the data center segment increased by 5.8% YoY, while data center segment revenue rose by 26.9% YoY.
High-speed Ethernet switches continued to grow significantly, with revenue in the 200/400 GbE segment increasing by 67.4% compared to Q1 and 100GbE switches accounting for 26.2% of all sales. Low-speed switches exhibited moderate growth, with revenue for the 1GbE switch segment increasing by 2.6% YoY. Despite counteracting factors such as supply chain disruptions, the Ethernet switch market remains steady thanks to the importance of digital infrastructure and networks in today's business world. Geographically, most regions experienced growth except for Central and Eastern Europe, whose market shrank by 12.5%.
Regarding the router market, income generated from the service provider segment grew by 2.2%, while the remaining corporate segment rose by 20.2% YoY. Western Europe's income grew by 4.2%, while Central and Eastern Europe decreased by 25.2% YoY.