NVIDIA Blackwell Solidify Leadership, AMD & Intel to Gain Ground With MI300X & Gaudi3

The global data center semiconductor and component market skyrocketed an unprecedented 152 percent in the first quarter of 2024, marking a new milestone, according to a report from Dell'Oro Group.

This explosive growth was fueled by insatiable demand for GPUs and custom accelerators, particularly in the hyperscale cloud sector.

The report revealed that in Q1 2024, NVIDIA led all vendors in component revenues, accounting for nearly half of the reported figures, as supplies of its H100 GPUs improved for both cloud and enterprise markets. Samsung and Intel followed NVIDIA in the rankings.

Looking ahead, strong growth for accelerators is expected to continue into 2024, with GPUs remaining the primary choice for AI training and inference workloads. NVIDIA's upcoming Blackwell platform is poised to strengthen the firm's leadership position.

However, the report anticipates that custom accelerators and offerings from other vendors, such as the AMD MI300X/MI325X Instinct and Intel Gaudi3, will gain some market share.

The report also noted that revenues for Smart NICs and DPUs surged more than 50 percent in Q1 2024, driven by strong hyperscale adoption for both AI and non-AI use cases. Storage drives and memory saw significant price increases as vendors aimed to align supply with demand. The three major memory suppliers shifted production capacity from DRAM to AI-focused High Bandwidth Memory (HBM) products.

Baron Fung, Senior Research Director at Dell'Oro Group, highlighted, "Accelerators such as GPUs continue to drive substantial growth, with shipments hitting record highs each quarter. Meanwhile, traditional server and storage component markets returned to positive year-over-year growth as vendors and cloud service providers ramped up purchases in anticipation of robust system demand later this year."

General-purpose computing components also rebounded strongly following an inventory correction cycle in 2023, experiencing double-digit revenue growth. "Average selling price (ASP) of components has increased significantly from a year ago adding to topline growth," Fung explained.

"For CPUs, an increasing mix toward fourth- and fifth-generation CPUs, which have more cores and feature sets compared to their predecessors, have commanded higher ASPs."

As data centers continue to expand and evolve to support the explosive growth of AI and cloud computing, the demand for high-performance semiconductors and components shows no signs of slowing down.