The rise in AI has helped push server sales to the second highest growth rate since 2019, nearly doubling since last year.
The AI boom has driven a massive rollout in infrastructure, with research suggesting data centres will continue to grow in size and number.
That surge is reflected in IDC's worldwide quarterly server tracker, which showed the overall market topped a record $77.3 billion in revenue in the final quarter of last year, up by 91% year-over-year.
"IDC expects AI adoption to continue growing at a remarkable pace as hyperscalers, CSPs, private companies, and governments around the world are increasingly prioritizing those investments,” said Lidice Fernandez , group vice president, Worldwide Enterprise Infrastructure Trackers
Revenue was up across all types of servers. Traditional x86 servers were up 59.9% to $54.8 billion, while non-x86 servers climbed a whopping 262.1% to $22.5 billion.
GPU growth reflects AI boom
Servers with an embedded GPU were up 192.6% for the fourth quarter year-over-year, and for the full year, that key segment for AI made up more than half of the server market. Nvidia continues to dominate that space with 90% of shipments in the final quarter of 2024.
"The fast pace at which hyperscalers and cloud service providers have been adopting servers with embedded GPUs has fueled the server market growth which has more than doubled in size since 2020 with revenue of $235.7 billion dollars for the full year 2024,” IDC said.
All that growth raises challenges, in particular surrounding the high energy use of data centers amid predictions the AI boom will lead data centre power demands to triple in the US.
Gartner also predicts 40% of data center operators will face power constraints — sending some tech companies to invest in alternative power sources such as nuclear.
"Growing concerns around energy consumption for server infrastructure will become a factor in data centers looking for alternatives to optimize their architectures and minimize energy use," Fernandez predicted.
Winners and losers
Dell and Supermicro remain atop IDC's tracker, but their dominance is increasingly being challenged. Dell held a 7.2% market share in the fourth quarter of 2024, while Supermicro held 6.5%.
Yet despite overall revenue growth, both had lost market share from the previous quarter, from 11.3% and 8.0% respectively.
HPE, IEIT Systems, and Lenovo all shared the next spot on the tracker, each with shares around the 5% mark. The original design manufacturer segment — which can reflect hyperscaler demand — made up almost half of the total revenue (47.3%), while the "rest of market" section nearly a quarter (23.7%), highlighting a significant shift in the market.
Indeed, that marks a big change from the fourth quarter of 2019. In that quarter, the global server market revenue grew just 7.5% year-over-year to $25.4 billion — versus last quarter's $77.3 billion in growth just five years on.
In 2019, ODMs had just a quarter of server revenue and "rest of market" just 16%.
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