Foxconn’s ODM direct enterprise will see exponential development in 2024, taking the highest rank in Omdia’s estimate of the worldwide server trade, pushed by the big demand for AI-optimized servers from main US cloud suppliers. Foxconn will turn out to be the primary non-US enterprise to high the server market rankings, surpassing Dell, which took the lead from HPE in 2018.
“The 4 largest cloud suppliers – Microsoft, Amazon, Google, and Meta – will comprise almost half of 2024’s knowledge heart capex, amplifying their affect on the aggressive server market,” mentioned Vlad Galabov, Senior Director at Omdia. NVIDIA-aligned producers are prospering as AI utility improvement and deployment take priority over computational targets. Due of those elements, Foxconn has risen to the highest.
There are different distributors gaining from the rise in demand for servers with AI optimization apart from Foxconn. In 2024, the server income of Tremendous Micro, ZT Methods, and Quanta Cloud Applied sciences (QCT) elevated by over 100%. Dell secured essential key shoppers together with xAI and CoreWeave. AI consulting providers had been among the many skilled providers and reference designs it created. Manoj Sukumaran, Senior Principal Analyst at Omdia, mentioned that “all server distributors will see 2024 as a significant success because of vital market development,” however modifications in rankings.
Cloud Service Suppliers
Within the server market, 2024 was a particular 12 months due to the concentrated nature of funding. In line with Omdia, ten server distributors will account for round 60% of worldwide server funding, with ten of these enterprises assembly greater than 70% of market demand.
Omdia completely information gross sales made on to customers by ODMs similar to Flex, Pegatron, and Foxconn. We don’t embody income from server manufacture for OEMs similar to Dell, HPE, and Cisco to be able to keep away from duplicate counting. Gross sales achieved by OEMs are usually not attributed to ODMs.
With a powerful collaboration with NVIDIA to supply Blackwell GPU reference designs, Foxconn has extra room to develop. Sukumaran continued, “They’ll emerge as the largest provider of NVL36 and NVL72 racks to cloud service suppliers.
2025 is predicted to be one other affluent 12 months for the info heart sector, particularly the server market, because of the following stage of AI infrastructure implementation at companies and cloud service suppliers. In line with Omdia, server capital expenditures would enhance by 22% that 12 months, reaching $280 billion. It’s anticipated that this sturdy development would proceed all through the last decade, with the server market reaching $380 billion by 2028 and over half a trillion {dollars} by 2030.
“We now have solely simply begun to discover the event and expenditure of AI-specialized cloud SPs,” mentioned Mr. Galabov. “CoreWeave could surpass Oracle in 2025 when it comes to server capital expenditures, that are anticipated to extend dramatically.”
Extremely regulated companies have knowledgeable Omdia that the legislative frameworks required to develop AI manufacturing will not be in place by 2024. Moreover, the dearth of GPU availability in 2024 restricted firm funding; nonetheless, this can change in 2025.
