Palo Alto Networks and Zscaler big winners in 2023. #pressrelease

March 5, 2024

1 Min Read

REDWOOD CITY, Calif. – According to a recently published report from Dell'Oro Group, the trusted source for market information about the telecommunications, security, networks, and data center industries, the network security market in 2023 witnessed a pivotal shift with revenues reaching $22.5 B. 2023 marked a deceleration to a single-digit growth rate, significantly influenced by the declining fortunes of hardware-based solutions, which saw a 1 percent decrease. In stark contrast, the SaaS and virtual network security segments emerged as the industry's new powerhouses, surging by 26 percent to $9.6 B. Nearly $5 B was due to the meteoric 30 percent rise in the SSE market, fueled by the widespread adoption of remote work and cloud applications necessitating SSE’s SaaS-based approach. The divergence between hardware, SaaS, and virtual solutions underscores a broader industry trend towards more agile, cloud-centric security solutions as enterprises seek to navigate the complexities of modern cyber threats and the evolving demands of a digital-first business landscape.

Additional highlights from the 4Q 2023 Network Security Quarterly Report:

  • The firewall market grew by low single digits in 2023 to nearly $13 B, highlighting its enduring relevance in enterprise defense strategies.

  • The WAF (Web Application Firewall) market displayed remarkable resilience, recording a low double-digit increase, predominantly by the adoption of SaaS-based solutions.

  • A pronounced shift in market dynamics saw North America and EMEA experiencing subdued single-digit revenue growth in 2023, largely attributed to hardware digestion and broader economic uncertainties.

  • Palo Alto Networks and Zscaler emerged as notable 2023 victors in this evolving landscape, with Palo Alto Networks expanding its number-one firewall revenue share to over 25 percent and Zscaler capturing an unprecedented 30 percent of the SSE market to maintain its number-one spot decisively.

Read the full press release here.
Dell'Oro

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