Global AI server shipments expected to jump 36%

SERVER TAKEOVER? A researcher said an increase in capital expenditure by CSPs reflects higher procurements and prices for memory, GPUs and AI server systems

• By Meryl Kao / Staff reporter

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Global artificial intelligence (AI) server shipments are expected to rise 36 percent year-on-year to 3.83 million units next year, as nine major cloud service providers (CSPs) in China and the US continue their robust investments in AI infrastructure, TrendForce Corp (集邦科技) said yesterday.

The nine major CSPs’ combined capital expenditure is projected to rise 60 percent year-on-year to US$1.52 trillion next year, despite market concerns and geopolitical tensions, TrendForce research manager Frank Kung (龔明德) told a forum in Taipei.

The nine CSPs are Alphabet Inc’s Google, Amazon.com Inc, Meta Platforms Inc, Microsoft Corp, Oracle Corp, ByteDance Ltd (字節跳動), Tencent Holdings (騰訊), Alibaba Group Holding (阿里巴巴) and Baidu Inc (百度).

Artificial intelligence server racks are displayed during the Nvidia Product Showcase at Computex in Taipei on June 3.

Photo: Cheng I-hwa, AFP

The increase in capital expenditure reflects higher procurements and rising prices across the supply chain, from memory chips and graphics processing units (GPUs) to AI server systems, Kung said.

Next year, the AI server market is expected to grow 92 percent to US$919 billion, accounting for 81 percent of the overall server market value, he said.

Nvidia is expected to remain the dominant AI server supplier next year, with shipments of 100,000 racks and a market share of 62.6 percent, he added.

As adoption broadens and supply improves, shipments of Nvidia’s Vera Rubin racks could expand further and overtake the GB series in the second quarter of next year, accounting for about 70 percent of Nvidia’s total rack shipments for the year, Kung said.

By contrast, shipments of server racks based on Nvidia’s next-generation Rubin Ultra platform are expected to remain limited, accounting for only a single-digit percentage of the chipmaker’s total rack shipments next year, he said.

TrendForce has reported growing demand from CSPs for Advanced Micro Devices Inc’s (AMD) Helios systems in the AI server market, Kung said.

Demand for the Helios systems is about 5,000 racks this year and the number could double next year, although deployment and delivery challenges could limit the conversion of orders into shipments, he said.

Helios could face similar, or even greater, ramp-up challenges than Nvidia’s new platforms because it is AMD’s first rack-scale design, meaning it would take time for customer demand to translate into actual deliveries, Kung added.