The Ethernet switch market posted record revenues in the second quarter of 2026, driven by GenAI infrastructure buildouts and upgrades to campus and edge networks that feed those systems. According to IDC data, switch revenues rose 43.4 percent year on year to $18.91 billion, up 23.1 percent sequentially from the first quarter.

The router market, under pressure for more than a decade as routing functions migrate into Ethernet switch ASICs, grew 22.8 percent to $4.51 billion, up 20.1 percent sequentially. Service providers, telcos, and neoclouds that cannot write their own routing software for Ethernet switches — as hyperscalers and cloud builders do — still buy routers from Cisco Systems, Juniper Networks, Huawei Technology, Nokia, and Ericsson.

Growth could run even hotter. Component shortages cap how fast the market can expand, but demand outstripping supply has its own effect on the upside, through price increases.

Vendor standings shift

Cisco's overall Ethernet revenues grew 36.2 percent to $5.43 billion in Q2 2026. Nvidia grew 2.8X to $3.86 billion, powered by its GenAI systems business and the attachment rate for Spectrum-X switches used to scale out DGX server nodes and NVL72 rackscale systems.

Nvidia's total dwarfed Arista Networks, which grew 37.6 percent to $2.53 billion. Hewlett Packard Enterprise, even after absorbing Juniper Networks, grew Ethernet switch revenues only 6.1 percent to $1.15 billion — still significant incremental business for a line that was largely Aruba wireless gear. Huawei came out ahead of HPE this quarter with $1.55 billion, up 28.6 percent.

IDC no longer publishes figures for the collective ODM group. By my estimate, ODMs took in $3.56 billion, up 2.43X year on year. If that estimate holds, vendors outside the top tier have lost substantial market share.

Datacenter switching leads

Datacenter Ethernet switch revenues reached $12.3 billion in Q2, up 64.5 percent year on year and 23 percent sequentially. I estimate roughly 129.5 million ports shipped into the datacenter market, mostly for scale-out networks, though that mix will shift. The datacenter segment accounted for 65.1 percent of revenues and 42.8 percent of ports shipped, according to my augmentation of IDC's data.

Port speed breakdowns tell the adoption story. Sales of switches with 800 Gb/sec ports — sold exclusively for datacenter use cases — rose 6.1X year on year to $5.07 billion, a 41.5 percent sequential increase. In Q1 2026, 35.9 percent of datacenter switch ports shipped were 800 Gb/sec; by Q2 that share reached 41.2 percent. I estimate 35.3 million 800 Gb/sec ports sold in Q1 and 54.3 million in Q2.

Hyperscalers and cloud builders are negotiating hard for discounts, and vendors are making up the revenue in volume despite component shortages. Prices per port for 800 Gb/sec and 200/400 Gb/sec switches came down slightly, but not by much.

Sales of 200 Gb/sec and 400 Gb/sec switches, almost entirely a datacenter play, rose 71.6 percent to $6.35 billion. I estimate 35.8 million ports at those speeds shipped in the quarter. Port counts per machine are climbing as 51.2 Tb/sec and 102.4 Tb/sec ASICs reach market, pushing customers toward higher radix, higher bandwidth, or both. Volume ramps of 1.6 Tb/sec switches for high-end GenAI systems are close, and low-latency Ethernet with UALink or ESUN protocols will soon offer an alternative to Nvidia's NVLink/NVSwitch pairing.

Datacenter vendor detail

Nvidia outgrew the ODM collective in scale-out Ethernet, nearly tripling its datacenter Ethernet switch sales. HPE grew a solid 2.1X in the datacenter, but that amounted to just $345 million — under one-tenth of Nvidia's datacenter take.

Cisco grew datacenter Ethernet sales 77.3 percent to $2.24 billion, a figure that excludes revenue from selling Silicon One ASICs to hyperscalers and cloud builders who have ODMs build their homegrown switches. Arista remains marginally larger than Cisco in the datacenter, growing 37.9 percent to $2.3 billion.

Compute outpaces network spend

The server market, inflated by expensive GPU-laden nodes and rackscale systems with high-speed scale-up networks that IDC's Ethernet data does not capture, is only now lifting the switch market. In Q2 2026, I estimate 6.2X more server cores sold than switch ports above 10 Gb/sec, counting all switch ports, not just datacenter ports. Companies appear not to be spending enough on networking to balance their compute. This happens repeatedly — and then people wonder why their server utilization is so low.