Global Network Security revenue reached $6.4 B in 2Q 2025, growing 8 percent year-over-year (Y/Y) driven by double-digit gains in Security Service Edge (SSE) and Application Delivery Controllers (ADC), as enterprises adopted AI-aware application protection and platform consolidation strategies to streamline operations and enhance defenses. In contrast, uneven hardware appliance refresh cycles tempered firewall growth, exposing the divergent trajectories between software-led and appliance-based.
“SSE grew 19 percent and ADC surged 24 percent, both more than double the overall market’s 8 percent rise, while virtual firewalls climbed 27 percent and physical appliances contracted 5 percent, underscoring the tilt toward cloud- and software-delivered controls,” said Mauricio Sanchez, Sr. Director, Enterprise Security and Networking at Dell’Oro Group. “Enterprise buyers are rewarding vendors that integrate AI-aware inspection and consolidate management consoles, and this mix shift will persist as organizations recalibrate hardware footprints and embrace cloud application-centric architectures.”
Additional highlights from the 2Q 2025 Network Security Quarterly Report:
- Revenue associated with cloud- and software-delivered network security controls is projected to increase by 20 percent in 2025, while hardware appliances are expected to decline by 2 percent.
- Network Security market projected to eclipse $26 B in 2025, reflecting high single-digit growth powered by zero-trust mandates, AI workloads, and continued cloud workload expansion.
- Within AS&D, virtual ADC revenue jumped 49 percent Y/Y while SaaS WAF accelerated by 21 percent.
- Virtual and SaaS-based Network Security solutions captured 78 percent of new spend.
