Key Points:
- Artificial intelligence (AI) infrastructure spending is projected to reach $1.1 trillion by 2029, driving growth in the networking equipment market.
- Data center spending is expected to increase, with networking being a critical component, and vendors like Cisco, HPE Juniper, Arista Networks, Nvidia, and Extreme Networks competing for market share.
- AI-specific networking is becoming a key area of focus, with vendors developing specialized hardware and software to support AI workloads and machine learning applications.
As a reporter, I’m here to bring you the latest updates on the rapidly evolving world of AI infrastructure spending and its impact on the networking equipment market. The stakes are enormous, with data center spending projected to hit $1.1 trillion by 2029, up from $430 billion in 2024. Networking is a critical bottleneck in this growth, and multiple vendors are vying for share to meet the requirements of AI in networking.
The landscape is evolving rapidly, with Ethernet gaining ground against InfiniBand and silicon photonics promising to revolutionize power efficiency. 800G is becoming the new standard, with 1.6T platforms arriving by the end of the year. In this competitive market, vendors are innovating to keep their leadership position. Cisco, for example, has received over $800 million in AI infrastructure orders from webscale customers in Q4 FY2025, bringing the fiscal year total to over $2 billion.
Cisco is leveraging its dominant enterprise position in overall networking market share to become a complete AI infrastructure provider spanning compute, networking, security, and management. The company has a number of key platforms and technologies that are advancing the state of AI networking, including the Silicon One P200 & 8223 Router, which is the industry’s first 51.2 Tbps fixed Ethernet router for distributed AI. Cisco is also innovating in the area of software and management platforms, with the Deep Network Model LLM, which is a networking-specific large language model trained on 40+ years of Cisco expertise and CCIE content.
HPE Juniper is another major player in the market, with a strategy that emphasizes "AI for networks and networking for AI". The company has completed its $14 billion Juniper acquisition, creating a $7B annual revenue networking powerhouse. HPE Juniper has a number of key AI networking hardware platforms, including the QFX5240 Series and PTX10000 Series, which deliver high-density 800GbE switches and modular routers with custom Express 5 ASIC.
Arista Networks is also a major player in the market, with a focus on software innovation and hyperscale validation. The company holds 18.9% data center Ethernet market share as of Q2 2025, with Q2 2025 revenue of $2.2 billion, up 30.4% YoY. Arista has a number of key AI networking hardware platforms, including the 7060X6 Series and 7800R4 Series, which deliver fixed AI leaf switches and modular spine scaling to 460 Tbps.
Nvidia is another major player in the market, with a focus on vertical integration and silicon photonics leadership. The company’s networking capabilities originated with its $6.9 billion acquisition of Mellanox Technologies in March 2019, bringing InfiniBand and high-speed Ethernet expertise. Nvidia has a number of key AI networking hardware platforms, including the Spectrum-X Platform and Spectrum-XGS, which deliver AI-specific Ethernet fabric and scale-across technology linking distributed data centers.
Extreme Networks is also a major player in the market, with a focus on AI management over AI hardware. The company has a number of key AI networking hardware platforms, including the 8730 Switch and 7830 Switch, which deliver fixed configuration and high-density 100G/400G fixed-modular core switches. Extreme is also innovating in the area of software and management platforms, with the Extreme Platform ONE, which integrates conversational, multimodal, and agentic AI with three agents cutting resolution times 98%.
As the market continues to evolve, it’s clear that AI-specific networking is becoming a key area of focus for vendors. With the growth of AI workloads and machine learning applications, the demand for specialized hardware and software is increasing. Vendors like Cisco, HPE Juniper, Arista Networks, Nvidia, and Extreme Networks are well-positioned to meet this demand, and the market is expected to continue to fragment as organizations hedge their bets across multiple vendors for both compute and networking. The future of AI networking is exciting, and it will be interesting to see how these vendors continue to innovate and compete in this rapidly evolving market.
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