Dell’Oro Group forecasts 11 percent CAGR for core router revenue through 2030

Dell’Oro Group finds High End Router demand recovered in 2025 and forecasts Core Router revenue to grow at an 11 percent Compound Annual Growth rate (CAGR) through 2030, affecting network planning for enterprises, cloud providers, and service providers.

Market Overview

The report states High End Router demand improved in 2025 after an 18 percent market correction in 2024 caused by oversupply and lower growth in network demand. It says the recovery is associated with increased routing equipment demand across multiple networking facets, especially Artificial Intelligence (AI) data centers.

Key Findings

The Dell’Oro forecast shows cumulative High End Router revenue of $71 billion for the five-year period and projects communication service providers will account for over 70 percent of revenue while cloud and enterprise/public demand grows faster. It also reports Core Routers will have the highest five-year CAGR, followed by Enterprise High End Routers and Edge Routers, and that router demand will increase across all major regions.

Analyst comment

“We significantly increased the High End Router market forecast from the one we published just six months ago. The main reason for the increase is an unexpected V-shaped recovery in Core Routers that is underway, driven by cloud providers and communication service providers as network demand increases, likely due to growing data center traffic. Additionally, while agentic AI is still in its early days, we believe enterprises are beginning to upgrade their networks to be AI-ready,” said Jimmy Yu.

Forecast

The report forecasts Core Router revenue will grow at an 11 percent compounded annual growth rate through 2030. It states communication service providers will remain the largest buyers of High End Routers over the next five years.

This Analyst Signals brief reflects a neutral, fact-based summary of the original research note.