Worldwide Server Market Spending with a 32.1% growth in Q1 2024 while expected to continue with a CAGR of 12.3% in a Five-Year Period, according to IDC
Unit demand began its recovery in the first quarter of 2024, growing 5.4% year over year, while server spending grew 32.1%, driven by a continued shift in mix to GPU servers, especially among hyperscalers and a handful of other large, mostly cloud, IT buyers. The market faces continued challenges throughout 2024, including remnants of impact from the pandemic, historically high inflation, slowdown in economic activity, supply chain disruption and geopolitical conflict.
However, the server market has proven resilient in recent years, as IT infrastructure has become increasingly mission critical for many organizations. An aging installed base is primed for refresh, and the launch of new generation processors late in 2023 will contribute to this cycle spreading into 2024, as the tech transition to new CPU platforms gradually moves forward. The market is expected to grow over the next five years at a 12.3% CAGR. The biggest impact and change to the forecast in this release is the addition of detail for accelerated servers, including GPU servers. While in 2023 large cloud service providers consumed most of these systems in an attempt to win the GPU arms race and stockpile inventory, it has become clear that these plans are not slowing down in 2024, and accelerated server adoption will continue growing at a high rate this year and beyond. This means that the server mix between very expensive accelerated servers and more moderately priced accelerated and non-accelerated servers will continue to shift towards the higher price points.
