NEEDHAM, Mass. – The global Artificial Intelligence (AI) infrastructure market is on track for unprecedented growth, poised to surpass $100 billion USD in spending by 2028, according to the latest findings from the International Data Corporation (IDC) Worldwide Semiannual Artificial Intelligence Infrastructure Tracker. Organizations increased spending on compute and storage hardware infrastructure for AI deployments by 37% year-over-year in the first half of 2024, reaching $31.8 billion.

The AI infrastructure market has sustained double-digit growth for nine consecutive half-years, driven primarily by investment in servers for AI deployments. In 1H24, servers accounted for 89% of the total spending, growing 37% compared to the same period last year. AI Infrastructure deployed in cloud and shared environments accounts for 65% of the total server spending in AI in 1H24, as hyperscalers, cloud service providers and digital service providers expand their infrastructure capabilities. Traditional enterprises, by contrast, have largely lagged behind in adopting on-premises AI infrastructure.

Servers with an embedded accelerator are the preferred infrastructure for AI platforms accounting for 58% of the total server AI infrastructure spending -- growing 63% in the first half of the year 2024. IDC projects that accelerated servers will exceed 60% of the server AI infrastructure spending by 2028, growing at a 19% 5-year CAGR rate.

Storage spending in AI infrastructure has been driven by the need to manage large datasets required for training AI models, as well as storage of training, checkpoints and repositories of data for inference phases. This category reported a 36% year-over-year growth rate in 1H24 with 56% of the spending coming from cloud deployments.

The United States leads the global AI infrastructure market, accounting for almost half of the total spending in 1H24, followed by PRC (23%), APJ (16%), and EMEA (10%). Over the next five years, IDC expects the APJ region to grow at the fastest CAGR (20%) followed by the USA (16%), EMEA (13%) and PRC (11%). By 2028, IDC forecast AI Infrastructure spending to reach $107Bn with servers deployed in cloud environments at 75% of the market total and accelerated servers around 56% of the total market spending.

“IDC expects AI adoption to continue growing at a remarkable pace as hyperscalers, CSPs, private companies, and governments around the world are increasingly prioritizing AI. Growing concerns around energy consumption for AI infrastructure will become a factor in datacenters looking for alternatives to optimize their architectures and minimize energy use” said Lidice Fernandez , Group Vice President, Worldwide Enterprise Infrastructure Trackers.

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Taxonomy Notes

IDC defines AI type considered AI centric in the server and storage categories including systems that run one or more of the following applications:

• AI platforms dedicated to AI application development; most AI training occurs here.

• AI applications whose prime function is to execute AI models; most AI inferencing happens in this category.
• AI-enabled (traditional) applications with some AI functionality
• AI application development and deployment (AD&D) software used to develop AI models and applications

The full taxonomy including definitions can be found in IDC's Worldwide Artificial Intelligence Infrastructure Tracker Taxonomy, 2024 (IDC # US US52098724). Fundamentally, the reporting of AI hardware in the AI Infrastructure Tracker a "workloads based" view of the server and storage markets, defined in IDC's Worldwide Semiannual Enterprise Infrastructure Tracker: Workloads Taxonomy, 2024 (IDC # US52673724 , November 2024).