The high-end router equipment market experienced a resurgence, growing 23% year-on-year in the third quarter of 2025. This expansion was primarily driven by a sharp recovery in core router demand, which increased 68% in the period, according to the latest research from Dell'Oro Group.
The market research firm attributed the rapid growth to capacity additions, rising data centre interconnect (DCI) traffic, cloud on-ramp deployments, and extensive network modernisation projects related to artificial intelligence (AI) infrastructure.
North America leads dramatic regional recovery
Growth rates were particularly strong in North America, where the high-end router market expanded a massive 47% year-on-year in Q3 2025, following a steep contraction in the previous year. The market grew across all geographies except Latin America during the quarter.
"Demand for router equipment is improving across most regions and all customer verticals we track," said Jimmy Yu, vice president at Dell'Oro Group. "In the third quarter, growth rates were especially high in North America due to a broad recovery. The growth drivers were pretty much everything but the kitchen sink."
Total market reaches $3.4bn; Cisco gains share
The total service provider router and switch market, comprising high-end routers and aggregation switches, grew 16% year-on-year to $3.4bn in Q3 2025.
For the first nine months of 2025, the top three core router vendors by revenue share were Cisco, Huawei, and HPE Juniper. Cisco gained the most significant market share among these vendors, adding five percentage points, highlighting increased competitive activity in the core router space.
All three customer verticals tracked by Dell'Oro Group grew year-on-year in both the quarter and first nine months of 2025. Cloud providers recorded the highest percentage growth, whilst communication service providers delivered the largest increase in dollar terms, underscoring the dual nature of network investment.
