The once stagnant market for data center network switches is experiencing a vibrant revival, thanks significantly to the burgeoning AI sector. Recent figures released by IDC spotlight a remarkable surge, with Q1 2025 revenues reaching $11.7 billion—a 32.3% year-over-year growth. This explosive growth is attributed to the increasing need for robust high-bandwidth, low-latency networks tailored to handle AI workloads.

In the first quarter, data center switch revenue grew by an astonishing 54.7%, surpassing even the impressive 32.1% increase from the fourth quarter of 2024. Notably, sales from 200/400 GbE switches skyrocketed by an impressive 189.7% compared to the previous year.

The debut of 800 GbE switches also made waves, capturing $350.8 million in sales and quickly constituting 5% of the overall market. Leading the charge, Nvidia saw its switch revenue soar by an incredible 760.3% year-on-year to $1.46 billion, with a notable 183.7% rise between Q4 2024 and Q1 2025.

Despite the robust market growth, Cisco faced challenges with a 3.2% decline in its data center switch revenue, hinting at mounting competition. Meanwhile, Arista Networks reported a healthier 27.1% growth to $1.6 billion.

While the demand for data center switches climbs, non-data center related revenues—stemming from campus and branch network switches—grew by a more modest 9.6%.

IDC’s latest report also reveals a 10.6% growth in wireless LAN revenue for Q1, marking a stabilization in supply and demand dynamics post-COVID-19 supply chain disruptions. The continuous development of 6 GHz Wi-Fi and AI-driven management tools promises further evolution in wireless connectivity.