This preliminary report briefly summarizes our Transport equipment market share analysis for 4Q23. It is released once company results for the current quarter are complete. Clients interested in real-time updates as companies report should monitor release notes and download the updated Excel file.
The final report, including detailed analysis and updated forecasts, will be available to all clients by March 14th, 2024. Clients can also register for the live presentation on March 15th, 2024 – if you register and don’t attend, you’ll still be notified when the .ppt download is available.
Summary and Highlights
Worldwide
- The worldwide optical market grew 2% this quarter. Sales excluding China, which grew 24% YoY, declined -8%.
- The worldwide routing market fell -8%, its second quarter of declines following the first half of 2023 in which it skyrocketed 16%.
- Vendor supply chains have largely recovered, but macroeconomic concerns and the high cost of capital are causing traditional service providers to slow spending.
- 5G-related transport spending has peaked and is now declining in countries that were early to deploy the technology, but it will continue to be a growth driver among the later adopters in Latin America and Asia.
Regional
- North American 4Q23 optical revenue dropped -11%; its third straight quarter of decline following 18 months of rapid growth post-pandemic. Routing revenue declined for the second consecutive quarter following eight straight quarters of growth, dropping -11%.
- Optical sales in China surged 25% to a quarterly record $1.59B. The country’s Tier 1 carriers, led by China Mobile, have begun the next phase of long-haul buildouts.
- Optical sales in RoAPAC were flat (-2%) following five quarters of rapid growth. Average quarterly spending remains elevated at $530M compared to $400M two years ago due to 5G buildouts among Indian Tier 1 operators.
- EMEA 4Q optical and routing sales fell -8% and -12% respectively, but both grew 4% for the full year 2023.
- Japanese 4Q optical revenue declined by -18% for the tenth straight quarter of YoY declines. Sales of $94M were the lowest fourth quarter since 2015.
- Optical spending in CALA grew 6%, capping off a year in which the region grew every quarter and finished with 5.4% annual growth.
Customer Markets
- Cloud & Colo operators grew 4Q23 optical spending by 46% worldwide, led by 73% growth in North America. Service Provider optical purchases declined -46% in North America due to the maturation of 5G buildouts, the high cost of capital, and delays in federal broadband funding.
- Cloud & Colo also led the way in routing with 7% growth in 4Q compared to declines of -10% for Service Providers and -12% for Enterprise & Government. Cloud spending in North America grew 16% in 4Q and now represents a quarter of the region’s routing spending.
Release Notes
- All data through 4Q23 is complete, except for Fiberhome, Infinera, Padtec, and Adtran, which are currently estimated.
- Unless otherwise indicated, all percentages in this report show year-over-year growth.
- Ciena’s October-end quarter is reported as calendar 4Q23. Cisco’s sales data aligns with calendar 4Q23.
Vendor Summary Reports
Cignal AI’s Vendor Summary Reports focus on the most recent quarterly financial results and items of interest for select vendors. For this quarter, the following vendor reports are available:
Clients log in to access full report