The revenue share numbers for data center processors paint a clear picture. NVIDIA has maintained strong growth over the years and is currently leading the market. The overarching question now is: what will be the new normal for data center market share in the future?A week ago, we saw a graph of HPC Guru on Twitter, and it was very compelling.
The chart below shows the market share of data center processor revenue by quarter since Q2 '19. It shows the collapse of Intel and the incredible rise of NVIDIA. Of course, the most striking thing is the size of NVIDIA's surge. In the most recent quarter, they held 73% of the market share. We know they're doing a great job, but as the saying goes, a picture is worth a thousand words, $14 billion in a quarter.
Data Center Revenue Share - AMD, Intel, and NVIDIA
In his reply to this thread, Ian Cutress asks a reasonable question: How much has the overall data center market grown during this time?The answer is that during this period, the market grew at a CAGR (compound annual growth rate) of 30% – Intel shrank at a rate of 6%, AMD grew by 27%, and NVIDIA grew at a rate of 103% per year.
It's also clear from this data that NVIDIA's truly phenomenal growth came in the last year after ChatGPT amazed the world. However, if we exclude the last 12 months, they have grown at a compound annual growth rate of 67%.
We tried to plot it as a generic scale chart and set 2q19 to 100, which is a convenient way to compare growth rates.
A common scale for data center revenue growth.
But NVIDIA's growth is so strong that it drowns out the signals of all the other companies. So we've got another graph without nvidia. This time, we are adding TSMC to the mix as another representative of market growth.
Excluding NVIDIA, the scale of the combined growth of data center revenue.
For those interested in remastering their own charts, this is raw data. Our data** is company presentations, quarterly reports, and U.S.** Exchange Commission documents. The focus is on the data center segment's revenue, but during this period, both Intel and AMD have reclassified the data segment, so the data for the early quarters is slightly different from the data for the more recent quarters.
As for TSMC, we used"hpc"Divisional reporting, they only started breaking down the data in Q2'19, which is the starting point for our series of reports. Finally, it's worth noting that all of these segments don't just include CPUs and GPUs, as each company defines a segment a little differently. This could mean that Intel's early revenue was inflated because it included networking, memory, and a few other products. As a result, their decline is not as large as it seems. Still, the overall trend is very clear.
We can draw two important conclusions from this. First of all, after years of hard work and a significant increase in share, AMD is still in a tepid third place in this market with a share of less than 10%. It's no surprise that they're still half the size of Intel, but they've stood out in the rise of NVIDIA.
The second, more important conclusion is that this market has now changed permanently. Again, this is something that everyone knows, but not everyone is aware of. NVIDIA can't maintain a 70 percent market share forever, but by the same token, Intel has had a 90 percent market share for more than a decade. Although we've been talking about the rise of heterogeneous computing, now we're entering an era where NVIDIA is a general-purpose factor in the data center.
Just as the tech world is excited about the bold future of AI, another way to understand the rise of large language models (LLMs) and AI is that the market is going through a cyclical shift. Just as the rise of Linux and Intel in the data center in the '90s heralded a market shift toward a new computing paradigm (what we call cloud computing today), the rise of LLMs seems to signal the rise of a new computing paradigm based on NVIDIA silicon.
In the foreseeable future, the problem is not"Can Intel reclaim the throne of the data center?(No), but how dominant will NVIDIA be?Will they be able to maintain a 70% share?(Probably not), or 50% is the long-term status quo?(Quite possibly).