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Supply Issues Continued to Limit Market Growth

REDWOOD CITY, Calif. – November 23, 2022 – 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, Optical Transport equipment revenue declined 6 percent year-over-year in the third quarter of 2022. Supply of components continued to weigh down the growth potential of the optical equipment market.

“The main culprit for this market revenue decline was the lack of component supply needed to make finished goods,” said Jimmy Yu, Vice President at Dell’Oro Group. “Optical vendors have a growing amount of backlog due to higher demand for DWDM equipment but are not able to deliver completed systems when they are short on one component or two. Another factor lowering the market revenue is the strengthening US dollar. Since the market revenue is based on US dollars, most sales in Europe and Asia are converted to fewer US dollars and reducing the reported market size,” added Yu.

Additional highlights from the 3Q 2022 Optical Transport Quarterly Report:

  • The total WDM equipment market, comprising Long Haul and Metro systems, declined 5 percent year-over-year in the quarter. However, we estimate that on a constant currency basis, the market revenue grew 0 to 1 percent in the same time period.
  • Among the regions in the report, North America remained slightly positive while Europe declined at the highest rate. Revenue from the European region declined due to a couple factors: 1) the lower conversion of euro currency to US dollar and 2) the declining demand caused by the Russia-Ukraine war.

About the Report

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 including 100 Gbps, 200 Gbps, 400 Gbps, and 800 Gbps).  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.

About Dell’Oro Group

Dell’Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, security, enterprise networks, data center infrastructure, and network security markets.  Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions.  For more information, contact Dell’Oro Group at +1.650.622.9400 or visit https://www.delloro.com.

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