Huawei beats Alcatel-Lucent in 1Q09 to top optical networking market for the first time; Asia-Pacific, led by strength in China and India, shows remarkable resilience despite the global downturn, says Ovum
Global spending of $3.6 billion meets our expectation; Alcatel-Lucent remains leader in annualized revenues
For immediate release, May 14, 2009. Ovum today announced its preliminary 1Q09 results for global optical equipment networking vendors. The global optical networking (ON) market, led by strength in Asia-Pacific markets, was $3.6 billion, down 15% sequentially and down 8% compared with 1Q08. “This marks the second time in two quarters that the ON market has shrunk compared with the year-ago quarter, but given the global financial meltdown the situation could have been much worse.” remarks Ovum’s Vice President, Optical Networking, Dana Cooperson. “Spending in Asia-Pacific was surprisingly strong. We did not see the seasonal decline we normally expect in China, for example, as the race to build 3G mobile networks and support them with transport capacity obliterated any seasonality or macroeconomic downturn factors. Huawei, posting a remarkable $790 million in revenue to lead the market for the quarter, benefited from China’s 3G race, along with teledensity growth in India, a strong and stable currency, and comparatively little exposure to the cool North American market, while Alcatel-Lucent suffered from much of the opposite.”
Top ten ON vendor share
Of the top ten vendors, none posted both sequential and year-over-year revenue gains, reflecting slowing spending in much of the world. Vendors who beat both the sequential and year-over-year average market declines of 15% and 8%, respectively, include Ericsson, Huawei, and NEC. Those three vendors plus ZTE were the only top ten vendors that did not post revenue declines compared with 1Q08. Huawei and ZTE grew revenues by more than 40% and 20%, respectively, over 1Q08 in part due to 3G mobile-related spending in China. “Alcatel-Lucent held on to the market lead with 21.7% annualized share, but Huawei picked up 1.8 percentage points to come within 3 points of the market leader at 19.1% share. Given the continued strength of spending in markets where Huawei is strong, its light exposure to weaker markets, and the firm’s seemingly bottomless availability of financing, this looks like a huge year for the Chinese giant.” said Cooperson.
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