Dell’Oro Group: 400 Gbps and 800 Gbps Ethernet port demand will drive router market growth

Dell’Oro Group’s newly published “Service Provider Router and Switch 5-Year January 2025 Forecast Report” predicts that the high-end router market will grow at a 4% CAGR for the next five years, reaching $12.7 billion by 2029.

The group says this growth will be largely driven by 400 Gbps and 800 Gbps Ethernet port shipments, which are expected to grow at a 30% CAGR and will contribute nearly 65% of the high-end router market revenue by 2029.

Dell’Oro Group vice president Jimmy Yu said that routers with 400 Gbps and 800 Gbps ports will be needed to fill the future bandwidth gap.

“Our long-term view of the routing market remains positive, especially for high-end routers,” said Yu in a press release. “At the end of the day, bandwidth demand continues to increase. There are, of course, times when the market contracts when network supply exceeds current needs, like it did last year in 2024. But overall, demand for more bandwidth has always gone up, and we do not see that changing any time soon.”

The group also expects demand from cloud service providers to increase, predicting that provider direct purchases of high-end routers will grow at a 9% CAGR.

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