A recently published report from Dell’Oro Group states that the analyst's preliminary readings suggest that worldwide telecom capex, i.e. the sum of wireless and wireline telecom investments, increased 9 percent year-over-year in nominal USD terms, and remains on track to advance 3 percent in 2022 --- before tapering off over the next two years.
Dell'Oro says that global capex growth is expected to moderate from 9 percent in 2021 to 3 percent in 2022, before tapering off in 2023 and 2024.
The analyst clarified that "the coupling between carrier investments and manufacturing infrastructure revenues is expected to prevail over the short-term, with capex and telecom equipment figures on track to advance 3 percent and 4 percent in 2022, respectively."
The analyst added that its overall the projections confirm positive momentum and growth expectations previously communicated with its telecom equipment programs reporting for segments including Broadband Access, Microwave Transmission & Mobile Backhaul, Optical Transport, Mobile Core Network, Radio Access Network, Service Provider Routers & Switches.
“Telco investments, in general, have shown remarkable resilience to external factors including Covid-19 containment measures, supply chain disruptions, and economic uncertainties,” noted Stefan Pongratz, vice president and analyst with the Dell’Oro Group.
Issued in March, Dell'Oro's 3-year Telecom Capex forecast report further states that "short-term output acceleration is expected to be relatively broad-based, with investments growing in China and the US."
At the same time, challenging comparisons in the US are expected "to drag down the overall capex in the outer part of the forecast," added the analyst. Meanwhile, following a strong showing in 2021, capex growth prospects across Europe are also projected to "be more muted" in 2022.
“Surging wireless investments in the US taken together with non-mobile capex expansions in China will keep the momentum going in 2022,” concluded Dell'Oro's Pongratz.
