NEWS PROVIDED BYDell’Oro Group
Jun 18, 2024, 08:00 ET
AI Server Demand Accelerates in Both Cloud and Enterprise
REDWOOD CITY, Calif., June 18, 2024 /PRNewswire/ — According to a recently published report by Dell’Oro Group, the trusted source for market information about the telecommunications, security, networks, and data center industries, accelerated servers equipped with GPUs and custom accelerators accounted for more than half of all server sales in 1Q 2024. Not only are the hyperscalers leading the way in deploying accelerated servers for AI workloads, but enterprises are also increasing their adoption of accelerated servers as GPU supplies improve.
“Worldwide data center capex experienced the first double-digit growth in five quarters. The hyperscale Cloud service providers in US and China saw an aggregate growth rate exceeding 40 percent as AI-infrastructure investments maintained strong growth momentum,” said Baron Fung, Sr. Research Director at Dell’Oro Group. “Meanwhile, there is optimism for a modest improvement in the outlook for enterprise IT spending along with a recovery in general-purpose server market later this year as end users replace servers overdue for refresh to the latest CPU platforms from Intel and AMD,” explained Fung.
Additional highlights from the 1Q 2024 Data Center IT Capex Quarterly Report:
- Server and storage system revenues are forecast for growth greater than 30 percent in 2024, while network and physical infrastructure revenues are expected to grow single digits.
- Dell led all OEMs in server revenue in 1Q 2024 followed by HPE and Supermicro. Accelerated servers accounted for an estimated 27 percent of the OEM server revenues during the quarter.
- White box server vendors gained 11 points of revenue share year-over-year compared to the OEMs as hyperscalers increased deployments of servers equipped with GPUs and custom accelerators.
- The accelerated server market is forecast to increase by more than 80 percent in 2024.
About the Report
Dell’Oro Group’s Data Center IT Capex Quarterly Report details the data center infrastructure capital expenditures of each of the ten largest Cloud service providers, as well as the Rest-of-Cloud, Telco, and Enterprise customer segments. Allocation of the data center infrastructure capex for general-purpose and accelerated servers, storage systems, and other auxiliary data center equipment is provided. The report also discusses market trends, drivers of the leading Cloud service providers’ capex growth during the quarter, and the outlook for the next year. To purchase this report, please contact us at dgsales@delloro.com.
About Dell’Oro Group
Dell’Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, security, enterprise networks infrastructure, and data center markets. Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions. For more information, contact Dell’Oro Group at +1.650.622.9400 or visit www.delloro.com.
SOURCE Dell’Oro Group