Shaking off earlier stumbles,

Cisco

(CSCO) - Get Report

hit its stride last quarter in the big router race.

Surging sales of core routers to phone companies helped the San Jose, Calif., tech giant reverse a long market-share slide. For the first quarter ended this spring, Cisco boosted its market share to 57.4% from 55% in the prior quarter ended in December, according to the Dell'Oro Group.

The galloping gains came at the expense of rival

Juniper

(JNPR) - Get Report

, which saw its share of the megarouter business slip to 37.9% from 39.6% in the previous period.

The strong performance helped reverse a losing trend for Cisco. For nearly two years, Juniper had been chipping away at Cisco's lead in the core routing category. Routers are computers that sort network traffic.

Strong demand for higher-capacity routers used by phone companies to manage Internet traffic helped accelerate growth in this corner of the market. Total first-quarter sales in the 10-gigabit core router segment grew 9% to $419.9 million from $384.3 in the prior quarter, says Dell'Oro.

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"We are seeing carriers put a lot more 10-gig routers in the edge" of the network, says Dell'Oro analyst Shin Umeda. "Bigger routers in the middle mean carriers are seeing the need for bigger edge routers."

Umeda says the growth isn't slowing as expected. In fact, Umeda raised his projection for 2005 core router growth to 54%, up from the 36% gain he predicted at the start of the year. Last year, big router sales grew 66%.

A big part of the overall strength in core routers is Cisco's success with its new megarouter, the CRS-1. After delays and setbacks last year, Cisco finally rolled out the box, which was developed as an answer to Juniper's T-640 or Gibson core router.

Earlier this month, Cisco chief John Chambers estimated that his company gained a couple percentage points in the market thanks in part to orders for the CRS-1. Cisco added three new customers for the big router, taking the total to 15.

Together, Cisco and Juniper command more than 95% of the big router business, one of the hot markets in an otherwise tepid tech-spending climate. Internet gear has been favored as phone companies shift spending away from conventional phone equipment.

These spending trends have not been kind to old-line outfits like

Lucent

( LU) and

Nortel

( NT).

Cisco shares were down 3 cents to $19.44 and Juniper was down 11 cents to $25.62 in midday trading Monday.