Nvidia's dominance in AI is moving beyond chips.
For the first time, the company became the top vendor by revenue in data center Ethernet switches — the networking gear that helps connect AI chips inside data centers, according to market research firm IDC.
This market is growing fast because cloud giants and other large businesses are pouring hundreds of billions into building out AI data centers. IDC research vice president Paul Nicholson called Nvidia's ascension "one of the most significant vendor landscape shifts IDC has tracked in enterprise networking."
In the first quarter of 2026, Nvidia generated $2.1 billion in data center Ethernet switch revenue — a 21.5% share of the market. That's up from 4% in the first quarter of 2024, said IDC senior research manager Brandon Butler.
Nvidia has pushed ahead of rivals like Arista Networks, which held a 20.7% share of the data center Ethernet switch market in the first quarter of this year. Other major players include Cisco, Huawei, and HPE.
The data center Ethernet switch market totaled $10 billion in the first quarter, according to IDC, growing 61% from a year earlier.
IDC attributed Nvidia's growth in networking revenue to its Spectrum-X product, "a tightly integrated system" that's designed to work closely with its AI chips, Butler said.
Butler said Nvidia's approach appeals to cloud giants looking to build quickly and avoid piecing together parts from multiple vendors. The trend also reflects a broader shift of companies buying networking and computing products together, IDC said.
The chip giant has increasingly highlighted networking as a major growth driver. At a shareholder meeting on Wednesday, Nvidia CEO Jensen Huang said Spectrum-X is "now larger than all other Ethernet networking peers combined."
The comments echoed Nvidia's most recent earnings call in May, when chief financial officer Colette Kress said the company's broader data center networking revenue had tripled to $15 billion from the previous year.
Nvidia's networking business traces back to its 2019 acquisition of Mellanox, which gave the company a foothold in data center networking before the AI boom took off.
Nvidia's lead isn't guaranteed. Cloud giants are increasingly looking to diversify their supplier base, Butler said, while businesses may lean on existing relationships with networking providers as they ramp up their infrastructure.
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Geoff Weiss is a senior reporter on Business Insider’s tech team, where he writes about AI startups and Y Combinator, the intersection of AI and the media industry, and workplace dynamics within top AI labs and chip companies.Previously, Geoff was on the media desk, covering YouTube and Netflix, and themes like the intersection of Hollywood and the creator economy. His work on Netflix’s video podcasting ambitions and Mr Beast’s lessons for Hollywood won second and first prize, respectively, at the 2025 LA Press Club Awards.Prior to joining Business Insider, Geoff was the senior editor of Tubefilter and a staff writer at Entrepreneur. He graduated from New York University with a degree in English Literature.He can be reached at [email protected], on Signal @geoffweiss.25, and on LinkedIn. Have a tip? Use a personal email address and a nonwork device; here's our guide to sharing information securely.Selected stories:Nvidia crushed its quarter — and CEO Jensen Huang said in a leaked all-hands that 'the market did not appreciate it'Nvidia will foot the bill for Trump's new visa fees. Here's what CEO Jensen Huang told staff.Massive AI salaries and RTO are fueling a real estate boom in San Francisco: 'It's going to rain money'The AI talent wars are ricocheting across startups. Here's how they're competing with Big Tech.
