The worldwide network security spend – including firewall, SSE, traditional SWG appliance, WAF, and ADC segments – is projected to be on a steady upswing through 2029, according to Dell’Oro Group.
Total network security revenue spanning physical appliances, software, and SaaS form factors is projected to climb from $24-billion to $38-billion as hybrid work, application migration to cloud, and AI-enabled attacks recalibrate corporate defence strategies.
However, the portion of the market sold as software and SaaS-based will significantly outpace physical appliance growth as enterprises appreciate greater agility and scalability leading to almost a doubling of associated revenue to $22 -billion.
“Enterprises are accelerating the move to elastic, cloud-centric security so they can adapt as quickly as the threat landscape evolves,” says Mauricio Sanchez, senior director, Enterprise Security and Networking at Dell’Oro Group. “Vendors that fuse networking and security into integrated software and SaaS-based platforms will capture the lion’s share of the $38-billion opportunity ahead.”
Additional highlights from the Network Security July 2025 Five-Year Forecast Report encompassing the years from 2024 to 2029 include:
- Firewalls are projected to remain the largest segment by revenue, expanding at an 8% CAGR as virtual firewalls outpace physical refresh cycles.
- Security Service Edge (SSE) is forecast to nearly double to $11-billion, growing 14% annually as enterprises embrace cloud‑delivered security for users and applications everywhere.
- Web Application Firewalls (WAF) revenue is anticipated to climb at a 14% CAGR, lifted by API security mandates and the continued rise of cloud-based applications.
- Application Delivery Controllers (ADC) are projected to hold steady with a 1% CAGR, with software instances offsetting waning demand for hardware.
- Traditional SWG appliances are forecast to decline at a 4% CAGR due to the structural pivot from appliances to SSE.