Enterprise Server Market

Enterprise Server Market Overview:

The global enterprise server market size reached US$ 119.3 Billion in 2023. Looking forward, IMARC Group expects the market to reach US$ 299.6 Billion by 2032, exhibiting a growth rate (CAGR) of 10.4% during 2024-2032. The market is driven by the growing reliance on cloud solutions that enable businesses to scale resources up and down based on the demand, increasing adoption of servers with built-in security features including intrusion detection systems, encryption, and secure boot options, and rising utilization of edge computing.

Enterprise Server Market Analysis:

• Major Market Drivers: The escalating demand for cloud-based solutions is positively influencing the market.
• Key Market Trends: The rising number of sophisticated cyberattacks, such as ransomware, phishing, and data breaches, is supporting the growth of the market.
• Geographical Trends: North America enjoys the leading position in the market as it is a home to some of the world’s largest technology companies and data center operators.
• Competitive Landscape: Some of the major market players in the enterprise server industry include Cisco Systems Inc., Dell Technologies Inc., Fujitsu Limited, Hewlett Packard Enterprise Company, Hitachi Ltd., Huawei Technologies Co. Ltd., Inspur Group, International Business Machines Corporation, Lenovo Group Limited, NEC Corporation, Oracle Corporation, Toshiba Corporation, and Unisys Corporation, among many others.
• Challenges and Opportunities: The market faces challenges, such as increasing competition, high energy consumption, and the need for constant innovation, while opportunities lie in the growing demand for cloud computing, edge computing, AI applications, and the expansion of data centers worldwide.
   

Enterprise Server Market Trends:

Shift towards cloud-based solutions

According to the IMARC Group’s report, the global cloud managed services market reached US$ 53.2 Billion in 2023. As businesses are adopting cloud services, many create hybrid cloud setups that blend on-premises servers with cloud resources. This development is catalyzing the demand for enterprise servers that can integrate smoothly with cloud infrastructures. Cloud solutions enable businesses to scale resources up and down based on the demand. This flexibility is driving the demand for enterprise servers that can handle dynamic workloads and interface with cloud services to improve resource management. Transitioning to cloud-based solutions frequently eliminates the need for large on-premises infrastructure, forcing firms to invest in enterprise servers to supplement their cloud strategy. Organizations need low-cost server solutions that improve their cloud capabilities while avoiding excessive costs. The transition to the cloud demands reliable data management and storage solutions. They are crucial for managing data flows between on-premises systems and the cloud, assuring data integrity and accessibility. With the development of remote work, cloud-based apps now enable employees to access data and applications from anywhere. This development increases the demand for these servers that can provide secure remote access and maintain dependable connectivity to cloud services. 

Cybersecurity needs

The rising number of sophisticated cyberattacks, such as ransomware, phishing, and data breaches, is increasing corporations' attention to cybersecurity. As a result, corporations are investing in enterprise servers equipped with strong security capabilities to safeguard sensitive data. These servers that fulfill these regulatory standards are in great demand, resulting in investments in secure server solutions. Organizations are searching for servers with built-in security features including intrusion detection systems, encryption, and secure boot options. The demand for security-enhanced hardware is driving the development and acceptance of these servers that include strong cybersecurity features. Many firms are looking for enterprise servers that can work smoothly with a variety of cybersecurity tools and platforms, including firewalls, antivirus software, and security information and event management (SIEM) systems. This integration is contributing to the creation of a comprehensive security posture, hence increasing the server demand. The IMARC Group’s report shows that the global cybersecurity market is expected to reach US$ 622.6 Billion by 2032.

Increasing demand for edge computing

Edge computing brings data processing closer to its source, lowering latency and improving reaction times. As enterprises need servers that deploy at the edge, they need to perform localized processing and analytics near the data's origin. With more IoT devices entering sectors like healthcare and automation, requiring real-time data analysis, the need for enterprise servers capable of high-speed edge data processing is growing. This trend is driving interest in servers that can handle high I/O operations. Processing data at the edge reduces the transfer to centralized data centers, cutting bandwidth costs and congestion while driving the server demand. Businesses need scalable solutions to handle increased workloads and deploy servers rapidly at distributed edge sites. Additionally, processing sensitive data locally with edge computing reduces security risks. As enterprises are prioritizing data security, there is an increase in the demand for enterprise servers with strong security features for edge deployments. As per the IMARC Group’s report, the global edge computing market is expected to reach US$ 90.3 Billion by 2032.

Enterprise Server Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the global, regional, and country levels for 2024-2032. Our report has categorized the market based on server type, server class, operating system, and end use industry.

Breakup by Server Type:

• Blade
• Multi-Node
• Tower
• Rack Optimized
   

Blade accounts for the majority of the market share

The report has provided a detailed breakup and analysis of the market based on the server type. This includes blade, multi-node, tower, and rack optimized. According to the report, blade represents the largest segment.

Blade servers are intended to reduce space needs in data centers. Unlike standard rack servers, blade servers are small and may hold numerous server components in a single chassis. This enables firms to maximize computing capacity while maintaining a smaller footprint, making blade servers excellent for businesses with limited space. Blade servers offer a highly scalable architecture. Organizations can add and remove server blades from the chassis as needed, allowing them to scale up or down in response to current workload demands. Blades spend less energy since they share components, such as power supplies, cooling systems, and network switches.

Breakup by Server Class:

• High-End Server
• Mid-Range Server
• Volume Server
   

High-end server holds the largest share of the industry

A detailed breakup and analysis of the market based on the server class have also been provided in the report. This includes high-end server, mid-range server, and volume server. According to the report, high-end server accounts for the largest market share.

High-end servers are built to perform exceptionally well, making them excellent for running resource-intensive applications like huge databases, enterprise resource planning (ERP) systems, scientific computing, artificial intelligence (AI), and real-time data analytics. These servers are used by organizations that demand a high level of computational power, speed, and dependability for mission important applications. Their strong architecture enables enterprises to combine workloads and run multiple apps concurrently without sacrificing performance. This capacity to enable large-scale virtualization is driving the demand in data centers and companies as they shift to hybrid or multi-cloud environments.

Breakup by Operating System:

• Linux
• Windows
• UNIX
• Others
   

Linux represents the leading market segment 

The report has provided a detailed breakup and analysis of the market based on the operating system. This includes Linux, windows, UNIX, and others. According to the report, Linux represents the largest segment.

Linux is open source, which means that it is free to use, change, and distribute. This makes it particularly appealing to businesses and organizations wishing to cut license costs associated with proprietary operating systems. The ability to modify the operating system to specific requirements is a significant advantage, allowing enterprises to tailor their server settings without incurring hefty license fees. One of the most major benefits of Linux is its cost-effectiveness. Linux is open source, which eliminates the need for expensive licenses and continuing software payments. This has made it the favored option for businesses wishing to increase their IT infrastructure without incurring major fees. Additionally, the availability of community assistance and free updates lowers running costs.

Breakup by End Use Industry:

• IT and Telecommunication
• BFSI
• Manufacturing
• Retail
• Healthcare
• Media and Entertainment
• Others
   

IT and telecommunication exhibits a clear dominance in the market 

A detailed breakup and analysis of the market based on the end use industry have also been provided in the report. This includes IT and telecommunication, BFSI, manufacturing, retail, healthcare, media and entertainment, and others. According to the report, IT and telecommunication accounts for the largest market share.

The IT and telecommunication industries generate and process vast volumes of data on a daily basis. Telecom corporations handle voice, data, and video traffic for billions of customers, whereas IT organizations handle cloud services, software applications, and numerous digital platforms. Enterprise servers are crucial for processing, storing, and analyzing this massive volume of data. The desire for servers capable of handling such large amounts of data is a major driver in the industry. Cloud computing is one of the fastest-growing industries of IT and telecommunications, and servers provide the foundation of cloud infrastructure. As more firms use cloud-based services, such as SaaS, PaaS, and IaaS, the demand for high-performance servers to support cloud architecture develops. Telecommunications firms, particularly those offering data hosting and cloud services, invest considerably.

Breakup by Region:

• North America
  • United States
  • Canada
• Asia-Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

North America leads the market, accounting for the largest enterprise server market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, North America represents the largest regional market for enterprise server.

North America, particularly the United States, is home to some of the world’s largest technology companies and data center operators. These companies invest in cutting-edge technology and drive innovations in cloud computing, artificial intelligence (AI), and data analytics. As a result, there is a high demand for enterprise servers to support their operations, research, and product development. The rapid adoption and expansion of cloud computing in North America are significantly driving the demand for these servers. Leading cloud service dominate the cloud market, and they require extensive server infrastructure to host their services. The widespread shift to cloud-based applications and infrastructure-as-a-service (IaaS) solutions is creating the need for enterprise servers in data centers across the region. Moreover, key players in the market are introducing latest operating systems to meet the increasing customer demand. For instance, in 2024, Wind River® introduced eLxr Pro, its commercial enterprise Linux offering to address the unique needs of cloud-to-edge deployments. eLxr Pro delivers long-term commercial support and services to the recently launched open source eLxr project distribution.

Competitive Landscape:

• The market research report has also provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the major market players in the enterprise server industry include Cisco Systems Inc., Dell Technologies Inc., Fujitsu Limited, Hewlett Packard Enterprise Company, Hitachi Ltd., Huawei Technologies Co. Ltd., Inspur Group, International Business Machines Corporation, Lenovo Group Limited, NEC Corporation, Oracle Corporation, Toshiba Corporation, and Unisys Corporation.

  (Please note that this is only a partial list of the key players, and the complete list is provided in the report.)

• Key players in the market are actively investing in technological advancements and expanding their product portfolios to meet the growing demands for cloud computing, AI, and data-driven applications. Companies are focusing on innovations in server performance, scalability, and energy efficiency to cater to the needs of large-scale data centers and enterprises. These players are also enhancing their server offerings with integrated support for hybrid cloud environments, edge computing, and AI workloads. For instance, in 2023, KX, a global leader in vector and time-series data management, launched KDB.AI Server Edition, a highly-performant, scalable, vector database for time-orientated generative AI and contextual search. KDB.AI Server offers a smooth setup for various environments, including cloud, on-premises, and hybrid systems, allowing businesses to quickly adopt and use its AI capabilities without complex setup processes. Additionally, they are working on collaborations and partnerships to provide end-to-end solutions that include hardware, software, and services, ensuring that enterprises can optimize their IT infrastructure. Many are also addressing the increasing cybersecurity requirements by offering servers with built-in security features and data encryption.

Enterprise Server Market News:

• September 2024: Lenovo, a global technology leader, announced the establishment of high-performance AI server manufacturing in India and the inauguration of its state-of-the-art research and development (R&D) lab dedicated to advancing Lenovo’s Infrastructure Solutions.
• September 2024: Eurotech, a leader in Edge Artificial Intelligence of Things (AIoT), introduced its new line of generative AI servers that operate as comprehensive platforms, capable of supporting a variety of generative AI models, starting with large language models (LLMs).

Enterprise Server Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, enterprise server market forecasts, and dynamics of the market from 2018-2032.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the global enterprise server market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the enterprise server industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides insight into the current positions of key players in the market.