Dell'Oro Group forecasts IPoDWDM market to reach $4.4 billion by 2030

Dell'Oro Group projects IPoDWDM systems will grow at a 16% average annual rate to $4.4 billion by 2030, and forecasts a jump in ZR+ pluggable shipments in 2026 as hyperscalers scale-across data centers for Artificial Intelligence (AI) factories.

Market Overview

Demand for IPoDWDM systems started to recover in 2Q 2024 and is on track to grow nearly 40 percent in 2025, the report says. The firm projects an average annual growth rate of 16 percent, reaching $4.4 billion by 2030.

Key Findings

ZR optics are the dominant pluggable used in IPoDWDM to date, and scale-across Data Center Interconnect (DCI) is expected to drive a sharp increase in 800 ZR+ optical module shipments in 2026. The report projects that over one-third of IPoDWDM ZR/ZR+ revenue will come from 800 ZR/ZR+ shipments in that year and that over 25 percent of system revenue will be from non-DCI applications by 2030.

Segment or Supplier Performance

In 3Q 2025 the top three suppliers for ZR/ZR+ optical pluggable modules by volume were Marvell, Cisco, and Ciena, listed from highest to lowest shipments.

Technology or Trend Analysis

“The interest level in ZR+ optics has grown by ten times since just a year ago,” said Jimmy Yu, Vice President at Dell’Oro Group.

In the original inception of coherent ZR pluggable modules the dominant use case was interconnecting data centers less than 80 kilometers apart, and ZR+ versions were developed as an afterthought without a clear need; with the rise in AI data centers the need shifted to moving data centers farther out with more fiber capacity to handle intensive AI workloads, pivoting demand toward IPoDWDM systems with large amounts of ZR+ optics, the report says.

Forecast or Analyst Outlook

The report forecasts nearly 40 percent growth in IPoDWDM demand in 2025 and anticipates a rise in 800 ZR+ module shipments in 2026. It expects IPoDWDM ZR/ZR+ revenue contributions from 800 ZR/ZR+ modules and from non-DCI applications to increase through 2030.

The analyst’s overall message highlights growing demand for IPoDWDM systems and rising ZR+ pluggable shipments as hyperscalers scale across data centers to support AI workloads. This Analyst Signals brief reflects a neutral, fact-based summary of the original research note.