The growth, in a word, is remarkable: figures from International Data Corporation (IDC) show that worldwide Ethernet switch revenues reached $14.7 billion toward the end of 2025, marking a 35.2% year-over-year increase and highlighting the scale of investment flowing into AI-driven networking.
The Q3 growth was led decisively by the data center segment, which expanded a stunning 62% from a year earlier. Hyperscalers and cloud service providers are racing to deploy high-bandwidth, low-latency networks capable of supporting AI training and inference workloads. As these workloads move from experimentation to production, network capacity has become a critical bottleneck, one that vendors are now scrambling to address.
Data Center vs. Non Data Center
Much of the momentum is concentrated at the highest end of the market. Sales of 200GbE and 400GbE switches nearly doubled year over year, while 800GbE equipment posted even sharper sequential gains and now accounts for a meaningful share of data center switch revenue. Original design manufacturer (ODM) direct sales also rose quickly, reflecting the growing willingness of large cloud operators to bypass traditional vendors in favor of customized hardware.
By contrast, the non-datacenter segment, which includes enterprise campus and branch networks, continues to grow at a steadier pace. Revenues in this category increased just over 8%, driven primarily by upgrades to 10GbE and 25/50GbE switching. While far less dramatic than data center growth, these investments signal ongoing modernization as enterprises prepare their networks for AI-enabled applications and automation tools.
NVIDIA Embraces Ethernet
Vendor performance highlights a market in flux. Cisco remains the largest Ethernet switch supplier overall, generating $4.4 billion in quarterly revenue and holding nearly 30% market share. However, its data center switch growth lagged the broader market, reflecting the company’s heavy exposure to slower-growing enterprise networks.
Arista Networks continues to benefit from its strong focus on cloud-scale environments. With nearly all of its switch revenue tied to data centers, Arista recorded close to 30% year-over-year growth and now commands a significant share of high-performance deployments.
The most notable shift, however, comes from NVIDIA. Long associated with InfiniBand networking, Nvidia has rapidly established itself as a major Ethernet switching vendor following the introduction of its Spectrum-X platform.
In the span of a year, Nvidia’s Ethernet switch revenue surged to $1 billion, giving the company an 11.6% share of the data center Ethernet market. According to IDC data, demand for Nvidia’s Ethernet offerings is now roughly on par with its InfiniBand business, signaling a strategic expansion well beyond GPUs.
Growing Importance of Networking
The Americas posted the strongest growth, with Ethernet switch revenue climbing more than 40% year over year, driven by an aggressive data center buildout in the United States. Europe, the Middle East, and Africa recorded more modest but still robust gains, while Asia-Pacific growth reflected sustained investment from both cloud providers and regional enterprises.
Routers, while less directly tied to AI workloads, are also benefiting from infrastructure expansion. The global router market grew nearly 16% year over year, led by service providers upgrading backbone networks to handle rising traffic volumes associated with cloud and AI services.
Looking ahead, it’s likely that the networking market’s trajectory will remain closely linked to AI adoption. As models grow larger and more distributed, demand for faster, denser, and more efficient Ethernet fabrics will intensify. What was once a relatively mature segment of enterprise IT has become a focal point of the AI arms race, with networking now recognized as foundational infrastructure rather than supporting plumbing.
