According to IDC, the server market reached a record $95.2 billion in market value during the first quarter of the year, showing the highest quarterly growth rate ever with a 134.1% increase compared to 1Q24. This outstanding performance pushed the market projection up for the year to a record $366 billion for 2025, which represents a 44.6% growth compared to 2024.
The x86 server market value is projected to increase by 39.9% in 2025 to $283.9 billion, while Non-x86 servers will increase by 63.7% year over year to $82.0 billion. Servers with an embedded GPU are projected to grow by 46.7%, representing almost 50% of the total market value in the year. The fast pace at which hyperscalers and cloud service providers continue adopting servers with embedded GPUs has fueled the server market growth, which will triple in size in only three years. Thanks mainly to the launch of large rack-scale configurations, ARM-based servers are rapidly gaining traction in the market by growing at 70.0% and representing 21.1% of the total shipments of the year.
“The Stargate project re-announcement promised to invest up to $500 billion in AI infrastructure to help create artificial general intelligence (AGI). Shortly thereafter, the release of DeepSeek’s R1 reasoning model caused concerns about the necessity of investing in so much infrastructure,” said Kuba Stolarski, research vice president for Worldwide Infrastructure Research at IDC. “R1 needed more infrastructure than was reported, and the evolution from simple chatbots to reasoning models to agentic AI will require several orders of magnitude more processing capacity, especially for inferencing. Improvements in the efficiency of model creation were expected and, in fact, a goal in the industry. Efficient models will use fewer resources, and therefore may scale better in multi-user environments, enabling high-level reasoning and possibly eventually leading to AGI.”
The United States is the fastest-growing region in the server market with an increase of 59.7% compared to 2024, representing almost 62% of the total revenue in 2025. China is also growing at a faster rate than other regions, with 39.5% year-over-year growth in 2025 and accounting for more than 21% of the quarterly revenue worldwide. Japan and APeJC had double-digit growth projected this year with 33.9% and 10.8% respectively. EMEA and Latin America showed single-digit growth at 7.0% and 0.7%, while Canada is showing negative 9.6% growth due to an unusually large deal in 2024.
According to IDC, the server market reached a record $95.2 billion in market value during the first quarter of the year, showing the highest quarterly growth rate ever with a 134.1% increase compared to 1Q24.
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