Inventory Correction to Continue for at Least One More Quarter
According to a recently published report from Dell’Oro Group, the trusted source for market information about the telecommunications, security, networks, and data center industries, the Optical Transport equipment market declined 19 percent year-over-year in 2Q 2024 due to an ongoing market correction caused by excess customer inventory, delays in new project starts in Asia Pacific, and weak macroeconomic conditions. The inventory correction that started in late 4Q 2023 is expected to continue for at least one more quarter.
“It was not so much the decline in the Optical Transport market that surprised me, it was the magnitude and breadth,” said Jimmy Yu, Vice President at Dell’Oro Group. “In the second quarter, nearly every region declined at a double-digit rate compared to 2Q 2023. This included a 15 percent decline in North America, 22 percent in Europe, and 28 percent in China to name a few,” added Yu.
Additional highlights from the 2Q 2024 Optical Transport Quarterly Report:
- The Optical Transport market outlook for 2024 was revised downward. The current forecast is for the Optical Transport equipment market to decline 8 percent in 2024.
- Every region declined year-over-year in 2Q 2024 with the exception of the Middle East and African (MEA) region. The steepest decline was in Asia Pacific across all of the countries we tracked (China, India, and Japan).
- Two vendors—Huawei and Cisco—gained more than 1 percentage point of market share in 2Q 2024 compared to the year ago period. Huawei’s share gain was nearly 6 percentage points.
The Dell’Oro Group Optical Transport Quarterly Report offers complete, in-depth coverage of the market with tables covering manufacturers’ revenue, average selling prices, and unit shipments (by speed up to 1.2+ Tbps). The report tracks DWDM long haul, WDM metro, multiservice multiplexers (SONET/SDH), optical switch, optical packet platforms, data center interconnect (metro and long haul), and disaggregated WDM. To purchase this report, please contact us at dgsales@delloro.com.
