According to the Optical Transport Quarterly Report, recently published by the Dell’Oro Group, optical transport equipment revenue grew 8% year-over-year in 1Q 2023. The analyst says the growth is due to an easing of component supply difficulties, an issue highlighted in its November 2022 report.
“For a second consecutive quarter, the Optical Transport equipment market growth exceeded our expectations,” said Jimmy Yu, vice president at Dell’Oro Group. “Equipment manufacturers are benefiting from the record level of backlog built-up over the past two years due to a lack of component supply. As these shortages moderate and lead times shrink, vendors are in a position to deliver long-awaited DWDM systems to their customers. This was the first time in two years that we did not hear a single vendor mention component shortage as a reason for lower than expected revenue in the quarter,” added Yu.
The 1Q 2023 Optical Transport Quarterly Report also highlights the progress of the major players and global growth. It says the largest global suppliers in the trailing four quarter period were Huawei, Ciena, Nokia, ZTE, and Infinera. Among these vendors, Nokia and Infinera outperformed. For the trailing four quarter period, Nokia’s optical revenue grew 13% and Infinera’s grew 20%. The China market slightly contracted in the quarter. However, if China is excluded from the worldwide figures, the optical market grew at a much higher rate of 12% year-over-year. Internet content provider (ICP) spending on WDM equipment increased year-over-year in the quarter, continuing the rebound in purchasing that started in 4Q 2022 after an unexpected drop in the third quarter.
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