Nvidia becomes the top vendor in data center Ethernet switching revenue

Nvidia just claimed the top spot in data center Ethernet switching revenue for the first time. In Q2 2025, Nvidia pulled in $2.3 billion in data center Ethernet switch revenue, a 647% year-over-year increase that gave it a 25.9% market share. That’s enough to leapfrog Arista Networks and Cisco, two companies that have owned this space for years.

From chip company to networking giant

The story here starts in April 2020, when Nvidia acquired Mellanox Technologies for $6.9 billion. Mellanox gave Nvidia the foundation for what eventually became the Spectrum-X Ethernet platform. Spectrum-X combines Ethernet switches with Data Processing Units, or DPUs, to create high-performance networking fabrics specifically optimized for AI workloads.

The growth trajectory has been steep. In Q1 2025, Nvidia generated approximately $1.46 billion in data center Ethernet switch revenue, representing an 8.6x year-over-year increase. By Q2 2025, that figure jumped to $2.3 billion. As of Q1 2026, Nvidia maintained its position at the top of the leaderboard in a market that grew 39.8% year-over-year to reach $15.4 billion.

The AI infrastructure arms race is reshaping the market

Overall Ethernet switch sales exceeded $8 billion in Q3 2025, more than double from three years prior. Nvidia held an 11.6% share in that quarter when measured across all Ethernet switching, not just data center. The data center-specific segment is where Nvidia’s dominance is most pronounced.

What this means for investors

The $6.9 billion Mellanox acquisition now looks like one of the shrewdest deals in recent tech history. A single quarter of Ethernet switching revenue, $2.3 billion, represents a third of the entire acquisition price.

Traders should watch Nvidia’s networking segment as a leading indicator of broader AI infrastructure spending. The overall data center Ethernet switch market grew nearly 40% year-over-year as of Q1 2026.

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