Omdia bets on Foxconn becoming world’s largest server vendor
Fuelled by skyrocketing demand for AI-optimised servers from major US cloud providers, Foxconn's ODM direct business will experience exponential growth in 2024, securing the top rank in Omdia's global server market analysis.
Foxconn will overtake Dell – which took the lead from HPE in 2018 –marking the first time a non-US company has led the server market rankings.
“The four largest cloud providers—Microsoft, Amazon, Google, and Meta—will comprise nearly half of 2024’s data center capex, amplifying their influence on the competitive server market,” says Vlad Galabov, Omdia Senior Director, in a press release. “With AI application development and deployment dominating compute priorities, vendors aligning with Nvidia are thriving. These dynamics have propelled Foxconn to the top spot.”
Foxconn isn’t the only vendor benefiting from the surge in demand for AI-optimized servers. Quanta Cloud Technologies (QCT), ZT Systems and Super Micro grew their server revenue more than 100% in 2024. Dell won big strategic clients like CoreWeave and xAI. It also developed a portfolio of professional services and reference designs, including AI consulting services. “Despite ranking shifts, all server vendors will see 2024 as a major success due to significant market growth,” said Manoj Sukumaran, Senior Principal Analyst at Omdia."
Omdia says that 2024 was a one-of-a-kind year in the server market due to the consolidation of investment. The analyst and consultancy firm forecasts that ten companies will make up nearly 60% of the global server investment; and ten companies will fulfil over 70% of market demand.
Omdia accounts only for direct-to-user sales by ODMs like Foxconn, Pegatron and Flex. Revenue from manufacturing servers for OEMs like Dell, HPE and Cisco is excluded to prevent double counting. ODMs are not credited for sales realised by OEMs.
“Foxconn has more growth ahead, having secured a close partnership with Nvidia to manufacture Blackwell GPU reference designs. They will become the largest supplier of NVL36 and NVL72 racks to cloud service providers,” adds Sukumaran.
2025 is expected to be another robust year for the data centre industry, particularly the server market, owing to the next phase of AI infrastructure deployment at both cloud service providers and enterprises. Omdia forecasts server capital expenditures to increase by 22% next year, topping USD 280 billion. This strong growth is predicted to continue throughout the decade, with the server market projected to reach USD 380 billion by 2028 and approaching half a trillion dollars by 2030.
