Accelerators are Expected to Surpass CPUs in Revenue by Nearly Two Fold in 2023
REDWOOD CITY, Calif. – December 19, 2023 – 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, accelerators, mainly used for AI applications, drove the server semiconductor and component market to 29 percent year-over-year in 3Q 2023. We project the accelerator market is on track to surpass the CPU market in revenues by nearly two-fold in 2023.
“The server and storage system component market is poised for an 11 percent growth for full-year 2023, primarily propelled by accelerators. Excluding accelerators, a 27 percent decline in revenue is forecasted, attributed to reduced demand resulting from inventory adjustments by system vendors and hyperscale cloud service providers for general-purpose computing,” stated Baron Fung, Senior Research Director at Dell’Oro Group. “Looking ahead to 2024, we anticipate strong double-digit growth in accelerator revenue. Moreover, our forecasts indicate a comprehensive recovery in the market across various categories, including CPU, memory, storage drives, and network interface cards (NICs), as vendors increase their inventories in anticipation of healthier server demand. Alongside the unit growth of these component categories, we expect pricing to improve in tandem with higher demand and the transition to the next-generation server platforms,” explained Fung.
Additional highlights from the 3Q 2023 Data Center IT Semiconductors and Components Quarterly Report:
- NVIDIA led in server and storage system component revenues in 3Q 2023, driven by GPU accelerators, followed by Intel and Samsung. Accelerator revenues are on track to surpass CPU revenues for the first time in 2023, reflecting a shift towards accelerated computing.
- NIC shipments declined briefly in 1H 2023 but returned to growth in 3Q 2023, driven by increased adoption of higher-speed ports and Smart NICs, especially for accelerated computing.
- GPU revenue is forecasted to achieve a 70 percent growth in 2024. Although NVIDIA currently dominates this market, potential challenges arise from new competitive offerings by AMD and Intel, coupled with the emergence of custom accelerators by the hyperscale cloud service providers.
Dell’Oro Group’s Data Center IT Semiconductors and Components Quarterly Report tracks revenue, unit and capacity shipments and unit and capacity pricing, along with market share of major semiconductor and component manufacturers that supply into the data center server and storage system markets starting from 2018. Technology of focus will be major server and storage semiconductors and components such as CPUs, accelerators such as GPUs, FPGAs, and custom AI ASICs, Ethernet and InfiniBand NICs and Smart NICs, HDDs, NAND/SSDs. In addition, we will provide a forecast of the demand for these components based on shipments of servers and storage system to the hyperscale cloud service providers and to the rest-of-the-market. To purchase this report, please contact us at dgsales@delloro.com.
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.
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