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Will Hewlett Packard Enterprise’s Revenues Rise in WLAN Segment?

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Wireless LAN market grew 4.5% YoY in 1Q16

According to IDC (International Data Corporation), the total WLAN (Wireless Local Area Network) market rose 4.5% YoY (year-over-year) and fell 10.7% on a sequential basis (quarter-over-quarter) in 1Q16. The Enterprise WLAN market rose 8.6% YoY in 1Q16.

Nolan Greene, senior research analyst for network infrastructure at IDC, said, “2016 is off to a strong start in terms of WLAN market growth, compared to the situation in the first quarter of 2015. With no major macroeconomic or geopolitical disruptions during the quarter, and as many network refreshes came due, WLAN spending trended upward in 1Q16.”

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Major players in the WLAN market

At the end of 1Q16, Cisco’s (CSCO) WLAN revenue rose 2.7% YoY. Its market share was 45.2% compared to 45% in 4Q15 and 47.8% in 1Q15. Cisco’s acquisition of Meraki is one of the company’s key revenue and growth drivers.

Aruba-Hewlett Packard Enterprise (HPE) is another major player in this market with a share of 15.8% in 1Q16 compared to 15.9% in 4Q15 and 17.6% in 1Q15. HPE’s revenues in 1Q16 fell 2.3% YoY to $187.6 million after several quarters of growth.

Ruckus (RKUS) revenues grew 21% YoY, and its market share rose to 7.7% in 1Q16 from 6.7% in 4Q15 and 6.9% in 1Q15.

Revenues for Ubiquiti and Aerohive also grew significantly YoY in 1Q16 by 63.3% and 62.9%, respectively. Ubiquiti accounted for 4.3% of the overall market in 1Q16, and Aerohive accounted for 2.3%.

In fiscal 2Q16, revenues from HPE’s networking business increased 57% YoY, up 17% YoY when adjusted for its Aruba acquisition. In May 2015, HPE acquired Aruba Networks for $3 billion in hopes of enhancing its role in the WLAN market.

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