Optical Transport Market Reaches $16 bn in 2023, Despite Fourth Quarter Decline

The global Optical Transport market achieved 2 percent growth reaching nearly $16 billion in 2023, according to recent analysis by Dell’Oro Group.
Kazakhstan mobile networkHowever, the Optical Transport market experienced a 6 percent year-over-year decline in the fourth quarter of 2023, primarily attributed to reduced demand across key regions including North America, Europe, and Japan.

Jimmy Yu, Vice President at Dell’Oro Group, revealed the main factors contributing to the downturn, stating, “Excess inventory, worsening macroeconomic conditions, and higher interest rates were the main reasons cited for the decline in these regions.”

The North American market faced challenges stemming from excess inventory accumulation following significant equipment investments in 2021 and 2022, resulting in a nearly 30 percent surge in optical equipment sales during that period. Consequently, a decline in 2023 was anticipated. However, the issue of inventory build-up was less pronounced in Europe and Japan.

In contrast, China has exhibited a notable improvement in spending on optical equipment after two consecutive years of decline, driven by increased investments by service providers in their optical backbone infrastructure.

The report also highlighted the performance of key vendors in the optical equipment market. Ciena, FiberHome, and Nokia emerged as the frontrunners in optical equipment business, gaining significant market share in 2023. Conversely, Cisco and Fujitsu experienced declines in optical equipment market.