The years-long decline in demand for radio access networks (RAN) that has battered sales at mobile equipment makers Ericsson AB and Nokia Oyj is showing signs of stabilisation, according to a report from Dell’Oro Group Inc.

Three of the six regions tracked by Dell’Oro showed signs of growth in the second quarter (2Q), compared to one region in the prior period, said the Redwood City, California-based telecom research company, whose reports are widely watched by the industry.

The shift offered “some glimmer of hope that the nadir of this cycle with double-digit declines might now be in the past for the time being,” vice president Stefan Pongratz said in a statement accompanying the report. 

Even so, the market for the gear that handles mobile communications declined at a double-digit rate year-over-year for the fourth consecutive quarter, according to Dell’Oro. 

Telecom operators in many parts of the world have been delaying expensive network upgrades, causing major issues for suppliers like Ericsson and Nokia. The overall radio market is expected to decline by an average of 2% a year over the next five years, but the 2Q growth shows that “the pace of the decline should moderate somewhat going forward,” Pongratz said.

Strong growth in North America and stability in China was offset by declines in the Asia-Pacific region, driven by a steep drop in India, the report found. India recently ended a major rollout of 5G. 

Huawei Technologies Co remains the biggest RAN supplier by revenue and gained market share in the first half, Dell’Oro said. Ericsson and Nokia were the next biggest providers and their combined market share fell by three to four percentage points. 

  - Bloomberg