The server market takes a hit from ongoing CPU and memory shortages.
Data centers face a double pressure on the hardware supply chain this year, as CPU shortages combine with an already serious memory shortage.
Memory remains biggest concern
According to a new Cloud and Datacenter Market Snapshot from analyst firm Omdia, server CPUs are struggling with increasing supply problems. These are partly the result of more complex production: chip manufacturers build the same processors on multiple nodes simultaneously, such as 3 nm and 5 nm. Shifting volumes between those nodes is time-consuming and difficult, while lower yields add further pressure. Omdia therefore expects price increases of 11 to 15 percent for server CPUs, although hyperscalers remain partly protected through long-term contracts.
The CPU problems come on top of a serious memory shortage. DRAM prices threaten to nearly double this quarter, while NAND flash is also becoming significantly more expensive. Manufacturers have shifted capacity to more profitable products like HBM memory for AI accelerators. Omdia warns that limited memory availability could slow server production and thus delay data center projects.
Growth despite everything
Yet demand remains high. Omdia still expects 12 percent growth in server deliveries this year, driven by a replacement wave of general servers. In the AI segment, the firm expects at least 71,000 racks with more than 100 kW load to be shipped this year, mainly through integrated GPU systems. Next year, that number would rise by more than half, with even racks above 200 kW.