Firewall market growth accelerates in Q3 - BofA

Investing.com -- The global firewall market grew 6.7% year-over-year in third quarter of 2024, reflecting a recovery in demand, Bank of America noted.

While appliances still dominate with an 88.5% market share, their growth was 5%, trailing the robust expansions of Virtual Firewalls (+15.2%) and Firewall-as-a-Service (FWaaS, +36.2%).

Palo Alto Networks (NASDAQ: PANW) maintained its leadership with a 28.1% share, up 50 basis points YoY. Fortinet’s share surged by 280 bps to 21.6%, while Check Point lost 50 bps, holding 10.8% of the market. Cisco (NASDAQ: CSCO) remained steady at 12.3%.

Network Firewalls, representing physical units and add-on subscriptions, showed a 5% YoY rebound, recovering from last year’s decline. Fortinet (NASDAQ: FTNT) led share gains in this segment, adding 330 bps YoY, while competitors like Check Point and Huawei saw declines.

Virtual Firewalls saw strong demand, particularly from the Secure Access Service Edge (SASE) and cloud security markets, but growth decelerated on a quarterly basis. FWaaS, benefiting from SASE proliferation, expanded its market contribution to 4.2%, with Palo Alto Networks increasing its lead to a 49.9% share.

Bank of America expects continued momentum in software-driven growth, with a potential for further shifts in market dynamics as end-of-support firewall units near replacement in 2026-2027.

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