Global telecom equipment market shrunk by 4% in Q1: Dell’Oro

Ray Le Maistre
By Ray Le Maistre

Jun 4, 2020

  • Uptick in mobile network investments
  • But slump in fixed network equipment sales
  • Second half of year looking brighter, notes Dell'Oro team

Increasing investments in 5G radio access and core networks were not enough to stave off a decline in overall telecom infrastructure equipment market spending during the first quarter of 2020, according to Dell’Oro.

The analyst firm’s various reports on the Broadband Access, Microwave & Optical Transport, Mobile Core & Radio Access Network, SP Router & CE Switch markets point to an overall year-on-year decline of 4% in global telecom network equipment investments.

Driven by 5G rollouts, sales of radio access network (RAN) and mobile core systems combined grew at a single-digit rate and accounted for more than half of the total market. 

However, the Covid-19 pandemic “had a more material impact on some of the non-wireless related segments, driven partly by supply chain disruptions and weakened demand as a result of increased macroeconomic uncertainty,” noted the Dell’Oro team. 

The combined revenues for the Broadband Access, Microwave Transport, and Routers and CE Switch sectors, which accounted for about a third of the overall market, declined at a double-digit pace compared with a year earlier, dragging the overall market down.

Huawei is still by far the largest vendor by sales, with a first quarter market share of 28%, followed by Nokia (15%), Ericsson (14%), ZTE (11%) and Cisco (6%). 

The good news, though, is that the Dell’Oro team expects “market conditions and supply chain risks to be more favourable” in the second half of the year, and still predicts that the overall market will grow by 1% for the full year compared with 2019.

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