AI buildouts will drive GPU and other accelerator revenues

According to a newly published forecast report by Dell’Oro Group, accelerator revenues, consisting mostly that of GPUs and custom accelerators, are forecast to grow at a 38 percent compound annual growth rate (CAGR) for the next five years. The worldwide Data Center IT Semiconductors market, which includes the major components for servers and storage systems, is set to reach $390 billion by 2028.

“We recently raised our revenue forecast on accelerators because AI-related data center capex for hyperscale Cloud SP and Enterprise markets has surged since last year, and is expected to remain elevated during our forecast horizon,” said Baron Fung, Senior Research Director at Dell’Oro Group. “In addition to AI, workloads such as video transcoding, HPC, and inline storage compression and decompression will also benefit from domain-specific accelerators. While NVIDIA currently has a dominant share in the GPU accelerator market, we anticipate that other vendors such as AMD and Intel, and the hyperscalers’ deployment of custom accelerators will gain some share over time as customers seek greater vendor diversity,” said Fung.

Additional highlights from the Data Center IT Semiconductors and Components 5-Year July 2024 Forecast Report:

We project the CPU market will lag that of other component categories in terms of growth, given the focus on optimizing the footprint of general-purpose servers.

The memory market will benefit from increasing AI infrastructure adoption, especially for high-bandwidth memory (HBM).

While the impact of AI is not immediately apparent, it is expected to inject long-term growth in the storage drive market given the vast amount of data that needs to be harvested and retained to train data models.

We significantly raised our revenue projections for NICs with the inclusion of the back-end market for connectivity to accelerated computing clusters.

SentinelOne acquires Prompt Security to enhance AI-native cybersecurity, targeting AI-related data...
DXC Technology partners with 7AI to revolutionise SOCs with autonomous AI agents, promising...
RAVEL introduces major updates to its AI offering, simplifying scalable AI adoption for various...
Litera's investment in Postilize marks a pivotal advancement in legal business development,...
BAE Systems strengthens its AI capabilities through strategic investment in Oxford Dynamics,...
AI investments thrive when paired with soft skills. Analytical and ethical capabilities unlock AI's...
Elastic introduces EASE, a serverless AI-powered security tool enhancing existing SIEM and EDR...
F5 and Equinix team up to enhance app deployment and security in hybrid multicloud environments,...