Data Center Accelerator Market on Track for Strong Growth, Estimated to Grow at 28.2% CAGR Through 2029

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What Is the Expected CAGR for the Data Center Accelerator Market Through 2025?
In recent times, the data center accelerator market has witnessed astounding growth. The market, which was valued at $21.6 billion in 2024, is forecasted to expand to $27.13 billion in 2025, with a Compound Annual Growth Rate (CAGR) of 25.6%. The significant growth in the past can be traced back to the rising demand for data processing, energy efficiency needs, the adoption of deep learning, as well as data center consolidation.

What's the Projected Size of the Global Data Center Accelerator Market by 2029?
Anticipated to witness a steep rise in the coming years, the data center accelerator market is projected to balloon to $73.28 billion by 2029, posting a compound annual growth rate (CAGR) of 28.2%. This surge during the forecast period can be credited to factors such as the need for customization and scalability, increased emphasis on security, a high demand for low-power accelerators, needs for real-time analytical prowess, and security acceleration solutions. During this period, the market is expected to be characterized by a rise in the use of graphics processing units (GPUs), a proliferation of high-performance computing (HPC) applications, growing integration with cloud services, collaborations aimed at standardization, and the acceleration of edge computing.

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Top Growth Drivers in the Data Center Accelerator Industry: What's Accelerating the Market?
The increasing need for cloud-based solutions is set to bolster the expansion of the data center accelerator market. These services, delivered over the internet or dedicated networks, enable on-demand availability and act as payment platforms. The enhanced operational efficiency provided by cloud services has led numerous businesses to adopt cloud architectures for better operational productivity. The use of cloud servers allows larger data storage and easy data accessibility. This surge in the requirement for cloud-based services is predicted to fuel the data center accelerator market's expansion. For instance, as per Forbes, a US-based business journal, IBM's shares have seen a rise of 17% year-to-date, outpacing the Nasdaq-100. This jump is attributed to the increased interest in artificial intelligence and the expected recovery in IT spending by 2024. The company surpassed expectations with its Q4 2023 outcomes, marking a 4% annual increase in revenue to $17.4 billion and earnings around $3.87 per share. Hence, the rising demand for cloud-based solutions is largely contributing to the growth of the data center accelerator market.

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What Trends Will Shape the Data Center Accelerator Market Through 2029 and Beyond?
Prominent firms active in the data center accelerator market are engaging in strategic alliances to co-create data center accelerator chips, enhancing their market earnings. These strategic partnerships are designed to release innovative resolutions, such as co-engineered chips, targeted at boosting data center efficacy. For instance, in October 2022, Intel Corporation, an American semiconductor conglomerate, collaborated with Google LLC, another American technology conglomerate, to collectively introduce the E2000 chip, a jointly engineered chip intended to enhance data center efficiency. The E2000 is an Infrastructure Processing Unit (IPU) which allows the CPU to handle computation by taking over network processing tasks. Furthermore, it offers an extra layer of security among diverse cloud service consumers by encrypting data. Google's recent virtual machine offering, the C3 VM, powered by Intel's fourth-generation Xeon CPUs, incorporates this chip.

What Are the Main Segments in the Data Center Accelerator Market?
The data center acceleratormarket covered in this report is segmented -

1) By Processor Type: CPU (Central Processing Unit), GPU (Graphics Processing Unit), FPGA (Field-Programmable Gate Array), ASIC (Application-specific Integrated Circuit)
2) By Type: HPC Accelerator, Cloud Accelerator
3) By Application: Deep Learning, Public Cloud Interface, Enterprise Interface
4) By End-User: Telecommunication &IT, Healthcare, BFSI, Government, Energy, Other End Users

Subsegments:
1) By CPU (Central Processing Unit): Server CPUs, Workstation CPUs
2) By GPU (Graphics Processing Unit): General-Purpose GPUs, Deep Learning GPUs, Gaming GPUs
3) By FPGA (Field-Programmable Gate Array): High-Performance FPGAs, Low-Power FPGAs
4) By ASIC (Application-Specific Integrated Circuit): Mining ASICs, AI And Machine Learning ASIC

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Which Top Companies are Driving Growth in the Data Center Accelerator Market?
Major companies operating in the data center accelerator market include Intel Corporation, Fujitsu Limited, Advanced Micro Devices Inc., Achronix Semiconductor Corporation, Google LLC, International Business Machines Corporation, Micron Technology Inc., Advantech Co. Ltd., Hewlett-Packard Development Company, Cisco Systems Inc., NEC Corporation, Lenovo Group Limited, NVIDIA Corporation, Mellanox Technologies, SambaNova Systems Inc, Habana Labs Ltd., Groq Inc., Cerebras Systems Inc., Graphcore Ltd., BrainChip Holdings Ltd., Flex Logix Technologies Inc., Ampere Computing LLC, Hailo Technologies Ltd., Lightmatter Inc., Esperanto Technologies Inc., Blaize Inc., Quadric Inc, GreenWaves Technologies SAS, Xelera Technologies GmbH, Mythic Inc., Silexica GmbH, Tensor Networks Inc.

Which Regions Will Dominate the Data Center Accelerator Market Through 2029?
North America was the largest region in the data center accelerator market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the data center accelerator market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa

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