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Omdia: servers for AI processing are big sellers

2 mins

Markus Ivakha

Published by: Markus Ivakha

21 March 2024, 10:05AM

In Brief

GPUs are now crucial in servers, especially for AI tasks, as per Omdia's report.

Despite a decline in units shipped, the server market surged to $31 billion in Q4 2023, with a focus on AI-oriented servers.

Investments in AI clusters delay server refresh cycles, extending server lifespan to 7.6 years, benefiting companies financially.

Nvidia dominates with data center sales hitting $18.4 billion, influencing OEM share gain in 2024.

Supermicro excels in server market revenue, thanks to its early adoption of GPU configurations, leading to a 240% stock increase in the past year.

Omdia: Servers for AI processing are big sellers

GPUs are now essential in servers, with companies focusing on investing in high-end server clusters for AI, says research firm Omdia.

The server market saw a rebound in sales, particularly in servers designed for AI tasks, featuring either high-end x86 processors or GPUs.

Omdia's Cloud and Datacenter Market Snapshot reveals global server market growth to $31 billion in Q4 2023, despite a decrease in the number of units shipped.

This reaffirms our thesis that end users are prioritising investment in highly configured server clusters for AI to the detriment of other projects, including delaying the refresh of older server fleets.

report notes

Investment in AI clusters delays server fleet refresh, extending the average useful life of servers to 7.6 years, benefiting companies' balance sheets.

Delaying server refresh has freed up capex funds for AI clusters. We anticipate that were they to reach 7 years, a set of formal disclosures will be made. Using equipment which is already amortized positively benefits the balance sheets of companies.

Omdia’s analysts

Nvidia emerges as a major beneficiary, with data center sales reaching $18.4 billion, driving the company's revenue growth and influencing OEM share gain in 2024.

Supermicro leads in server market revenue growth, leveraging early adoption of GPU configurations, propelling its stock up 240% in the last year.

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