AI boom stimulates data center switch market

Spending on Ethernet data center switches rose again in the second quarter of 2024 after a temporary decline in the first quarter. This is according to a recent market report by the Dell'Oro Group. A sharp increase in investments related to artificial intelligence (AI) compensated for the ongoing weakness in traditional networks used for classic servers. According to the analysts, the reason for the weakness continues to be the reduction in orders and inventories.

Port speeds of 200, 400 and 800 Gbit/s were the only ones to show sales growth during the quarter , according to Dell'Oro, accounting for more than a third of total sales. Another interesting fact is that there was stagnation not only among traditional networks, but also among their manufacturers. Suppliers such as Arista, Huawei, Nvidia and Celestica achieved the largest share of sales growth.

Celestica, a manufacturer that is largely unknown in Germany, recorded the largest increase in sales. However, Arista secured the top position in terms of turnover after competing closely with Cisco in the last three quarters. This is due to the fact that the only positive customer segment with an increase in revenue was cloud service providers. It is precisely in this segment that Arista is particularly prevalent.

(anw)