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Strong Regional Performance in Asia/Pacific Drives Security Appliance Growth in Q4 2020, According to IDC

NEEDHAM, Mass. – Worldwide revenue in the security appliance market grew 11.3% year over year and 15.0% quarter over quarter in the fourth quarter of 2020 (4Q20), according to the International Data Corporation (IDCWorldwide Quarterly Security Appliance Tracker. Overall market revenue totaled $5.3 billion, an increase of $538 million from the fourth quarter of 2019. Unit shipments in 4Q20 increased 10.2% year over year and 15.3% compared to 3Q20.

The unified threat management (UTM) market accounted for 79.5% of the year-over-year increase in revenue, thanks largely to the strength of sales in the Asia/Pacific region and regardless of the on-going pandemic. However, despite being significantly smaller overall, virtual private network (VPN) sales grew the most with year-over-year revenue growth of 21.8%. Legacy security appliances, including traditional firewall and intrusion detection and prevention systems (IDS/IPS) experienced slight declines in unit shipments for the quarter.

Regional Highlights

From a geographic perspective, China carried the security appliance market for the quarter, growing by 27.4% year over year and 60.3% quarter over quarter with revenues increasing $531.4 million compared to 3Q20. The rest of the world (excluding China) delivered 6.4% annual growth and 4.3% sequential growth. Additionally, although significantly smaller than China, the Middle East & Africa region grew by an impressive 24.2% year over year and 39.1% compared to 3Q20. Other regions that experienced strong annual growth for the quarter were Asia/Pacific (excluding Japan and China) at 11.1%, Central and Eastern Europe at 9.7%, and Japan at 9.1%.

“While the ongoing pandemic has dampened the appetite for on-premise security hardware around the world, standout performances in China and a few other regions helped the security appliance market grow an impressive 11.3% year over year,” said Pete Finalle, senior analyst, Security and Trust at IDC.

Top 5 Companies, Worldwide Security Appliance Revenue, Market Share, and Growth, Fourth Quarter of 2020 (revenue in US$ millions)
Vendor 4Q20 Revenue 4Q20 Market Share 4Q19

Revenue

4Q19 Market Share 4Q20/4Q19 Growth
T1. Palo Alto Networks $794.0 15.0% $644.7 13.6% 23.2%
T1. Cisco $770.1 14.6% $757.5 15.9% 1.7%
3. Fortinet $642.0 12.1% $528.3 11.1% 21.5%
4. Check Point $439.9 8.3% $450.5 9.5% -2.4%
T5. Huawei $204.2 3.9% $145.6 3.1% 40.3%
T5. SonicWALL $174.4 3.3% $182.6 3.8% -4.5%
Rest of Market $2,262.8 42.8% $2,040.1 43.0% 10.9%
Total $5,287.4 100% $4,749.4 100% 11.3%
Source: IDC Worldwide Quarterly Security Appliance Tracker Q4 2020, March 11, 2020

* Note: IDC declares a statistical tie in the worldwide security appliance market when there is a difference of one percent or less in the share of revenues or shipments among two or more vendors.

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