Telecom equipment market growth weakens

Following four consecutive years of modest telecom equipment growth across the six telecom programs tracked at the Dell’Oro Group, preliminary findings show that the aggregate telecom equipment market moderated somewhat from the 8% revenue increase in 2021 to 3% year-over-year (Y/Y) in 2022, Report informs.

Looking back at the full year, the results were slightly lower than the 4% growth rate projected a year ago going into 2022. In addition to more challenging comparisons in the advanced 5G markets and the supplier exits in Russia, the strengthening USD weighed on the broader telecom equipment market. Supply issues also impacted the market negatively during 1H22 but eased somewhat in the second half.

Regional developments were mixed, underpinned by strong growth in North America and CALA, which was enough to offset more challenging conditions in EMEA and the Asia Pacific. With China growing around 4%, it is estimated global telecom equipment revenues excluding China increase around 3% in 2022.

Vendor dynamics were relatively stable between 2021 and 2022, with the top 7 suppliers driving around 80% of the overall market. Despite on-going efforts by the US government to limit Huawei's TAM and access to the latest silicon, the assessment is that Huawei still leads the global telecom equipment market, in part because Huawei remains the #1 supplier in five out of the six telecom segments we track. At the same time, Huawei has lost some ground outside of China. Still, Nokia, Ericsson, and Huawei were the top 3 suppliers outside of China in 2022, accounting for around 20%, 18%, and 18% of the market, respectively.