Data Center Server Market Size and Share Analysis by Type (Rack, Tower, Blade, Micro), Application (BFSI, IT & Telecom, Government, Healthcare, Energy, Manufacturing) - Global Industry Revenue Estimation and Demand Forecast to 2030

Data Center Server Market Overview

The global Data Center Server Market revenue was USD 139.1 billion in 2023, and it is expected to reach USD 307.0 billion by 2030, advancing with a CAGR of 11.6% during the forecast period.

The prime factors that drive the market are the advancement in the IT & telecom industry, growing incorporation of AI and ML into data center servers, increasing adoption of cloud-based services, rapid digitalization, and surging adoption of the 5G technology, which needs reliable, scalable servers for handling the increased network traffic. Moreover, the burgeoning count of AI-powered server providers and increasing need for data storage among organizations will boost the market growth.

Rack Category Dominates Market

The rack category accounted for the largest revenue share, of 60%, in 2023, and it is expected to maintain its position during the forecast period.

• This is mainly because rack servers help in meeting the demands of high-end applications, and they are easier to work with compared to others, as they are integrated into racks and are more compact.
• Additionally, they have internal fans, thus are usually easier to cool.
• The rack design can also offer increased airflow, and it is also more cost-effective.
• Rack servers are better for surroundings where no more than about 10 servers are needed.
• This makes them a good fit for many SMEs, especially considering their lower upfront cost.
• With their general-purpose capabilities, rack servers support numerous infrastructure demands for these businesses without taking up much space.
• They are also better for creating standardized racks where an enterprise can deploy dozens of servers at once.

Moreover, the tower category will grow at a high pace in the coming years, owing to the affordability of these variants. These servers also have fewer overheating issues as they cool down easily and quickly, are easy to upgrade, and offer high computational power.

Exponential Growth in Data Generation Drives Market Advance

The increasing size of databases is helping organizations grow and make better decisions, by leveraging this data to analyze historical patterns and make future decisions accordingly. Companies gather, store, process, and analyze massive volumes of data each day to improve their offerings, retain customers, and increase revenue. For this, companies must be equipped to manage the continuous surge in data volumes.

Moreover, billions of people around the globe now have internet connectivity. Every action they perform online generates new data, which businesses use to manage human resources, track inventory, and offer personalized product and service recommendations.

• Around 2.5 quintillion bytes of data is generated each day.
• Further, there are currently over 44 Zettabytes of data in the entire digital universe, with users generating 70% of it.
• By 2025, 175 Zettabytes of data would be in the world’s servers, including healthcare data.
• Thus, the healthcare industry’s spending on big data analytics solutions and services has been forecast to reach USD 79.23 billion by 2028.

Industry experts believe most companies that employ more than 10 people collect some form of digitized data and use it for enhancing their marketing strategies; they, transfer it internationally as well. This growth in data generation drives the demand for data centers for fulfilling the storage and processing requirements of companies.

Commercial Category Will Show Substantial Growth in Future

The commercial category will witness significant growth during the forecast period. This is due to the growing number of established organizations and startups, integration of technologies such as AI, big data analytics, IoT, and cloud into business operations, and increasing investment by companies to fulfill governments’ strict regulations regarding data handling, storage, and privacy.

Increasing Digitalization Rate and Improving Internet Infrastructure

• The rise in internet speed and the growth in the population internet users have led to massive volumes of data generation and rapid social media penetration over the past few years.
• Further, around the globe, an increasing number of internet exchanges are set up to enhance data connectivity among data centers.
• Due to the burgeoning interconnectivity globally, significantly more data will be generated at various points.
• Data center operators will need to install more-advanced servers to enhance information processing, leading to a higher server density.
• Countries in the Middle East, Africa, and Asia-Pacific are witnessing significant digitalization, thereby driving the construction of data centers and, in turn, propelling the market.

BFSI Category Is Significant Revenue Contributor

The BFSI category held a significant revenue share, of 45%, in 2023. This can be ascribed to the growing implementation of cloud-based solutions, which necessitates reliable, robust, and scalable server infrastructure. Additionally, the higher need to utilize the personal and financial information of bank customers for multiple purposes, including personalized recommendation, transaction processing, account opening, and customer engagement and retention, propels the demand for efficient and high-capacity servers at the attached data centers.

The healthcare category will witness significant growth in the coming years.

• This can be attributed to the enhancing healthcare infrastructure, along with technological advancements, burgeoning capital investment by several public and private organizations, and surging importance of data storage in the healthcare sector.
• Moreover, the need for telemedicine is growing owing to its ability to lower the cost of care and quick access to medical practitioners consumers from anywhere.

Furthermore, IT & telecom category will register a substantial growth rate during the forecast period. The primary reason is the ongoing deployment of advanced software and applications in the industry and the founding of several startups across the globe. Further, the telecom sector has witnessed a surge in the number of mobile internet users over the last 20 years, which has led to a massive demand for data storage. The introduction of technologies such as 5G and IoT is expected to drive the growth of the IT & telecom industry in the market further, because they create massive volumes of data.

Moreover, the government sector is witnessing significant growth, thus fueling the demand for data centers globally.

• This is because government organizations have begun to store their data in enterprise self-build data centers, and they are swiftly shifting to cloud platforms for data processing and storage.
• In addition, the government policies for data localization result in an increase in the investments in data centers.

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North America Is Prime Revenue Contributor

North America held the highest revenue share, of 40%, in 2023, and it is further expected to maintain its dominance during the forecast period. This will be due to the presence of a large number of industry giants, developed IT infrastructure, expansive network of data centers, and high adoption of advanced technologies, such as AI and ML, in an increasing number of industries. Furthermore, the region has a growing BFSI sector and well-developed healthcare sector, both of which are becoming increasingly reliant on the analysis of digital information.

Moreover,

• The U.S. generated the majority of the revenue in 2023, and it is further expected to maintain its dominance in the coming years.
• This is due to the fact that the nation is home to several industry players, well-established IT sector, and high count of data centers.

APAC will witness the fastest growth during the forecast period, with a CAGR of 15%. This will be due to the surging need for data storage owing to the growing number of internet users, rapid digitalization associated with urbanization, burgeoning IT & telecom industry, and rising adoption of cloud services.

Furthermore, the increasing pace of advancements in digital technologies, growing investments in AI and IoT, burgeoning smartphone and broadband penetration, which results in the rising generation of data, propel the market in the region. Additionally, the surge in the consumption of data is fueled by several government initiatives to create a stronger digital ecosystem, such as smart city development. Moreover, APAC has over 2.5 billion internet users.

Moreover,

• China, Japan, South Korea, and India significantly contribute to the revenue of the regional market, owing to the rapid growth in end-use industries and rise in the investments by the public and private sectors.
• Additionally, the shift of on-premises data to colocation facilities and a surge in workload will raise the capital spending in server infrastructure across industry verticals.

Europe held the significant revenue share in 2023, ascribed to the high acceptance rate for advanced digital technologies, increasing internet penetration, and 5G network rollouts in the region.

Moreover, according to the International Trade Administration, the U.K. is the largest cloud market in Europe, with USD 12 billion generated by public cloud services in 2020. Moreover, as per industry experts, companies using cloud solutions report a significant increase in efficiency, along with infrastructure modernization. Since cloud services are provided through data centers, a rise in the demand for such solutions subsequently leads to an increase in the demand for data centers and their servers.

The MEA will also register substantial growth during the forecast period.

• This will be due to lucrative opportunities being created by the rising degree of globalization, coupled with digitalization.
• Additionally, in Africa, the gradually rising investments for data center advancement and the entrance of global data center operators drive the market.
• Other factors for the market growth in the region are the rising demand for edge data centers and increasing technology penetration.
• This, in turn, will fuel the requirement for micro as well as high-density servers in those facilities.

Furthermore, several market players are involved in the launch of advanced servers that aid customers with more reliability and scalability. For instance, in October 2023, Super Micro Computer Inc. began shipments of Grace Hopper superchip-based servers named NVIDIA GH200. These products are designed to improve AI workload performance by employing tightly integrated GPU, CPU, DPU, and networking and communication modules.

Similarly,

• In January 2023, Dell Technologies Inc. introduced PowerEdge servers, which are designed for powerful computing in core data centers and large-scale public clouds.
• In June 2023, Oracle Corporation launched a new generation of its Exadata platform, known as X10M. It offers enhanced performance and availability for all Oracle databases and delivers a high performance for complex data center workloads.

Top Data Center Server Manufacturers:

• Cisco Systems Inc.
• Dell Technologies Inc.
• Hewlett Packard Enterprise Company
• IBM Corporation
• Oracle Corporation
• Lenovo Group Ltd.
• Atos SE
• Super Micro Computer Inc.

Market Size Breakdown by Segment

This fully customizable report gives a detailed analysis of the data center server market from 2024 to 2030, based on all the relevant segments and geographies.

Based on Type

• Rack
• Tower
• Blade
• Micro

Based on Application

• BFSI
• IT & Telecom
• Government
• Healthcare
• Energy
• Manufacturing

Geographical Analysis

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
• Asia-Pacific
  • Japan
  • China
  • India
  • South Korea
  • Australia
• Latin America
  • Brazil
  • Mexico
• Middle East and Africa
  • Saudi Arabia
  • South Africa
  • U.A.E.