Global Micro Server IC Market Grows at a Steady CAGR of 8.5%

Introduction

The global micro server IC market encompasses integrated circuits utilised in micro servers—compact, energy-saving servers optimised for low to moderate workloads such as web hosting, edge computing, and content delivery. These chips support high-density server setups with minimal power and efficient space usage, serving SMEs, data centres, and cloud providers.

The global micro server IC market is expanding due to increased internet activity, cloud service growth, and data centre development. Advanced IC technologies like ARM and x86 architectures are improving server efficiency, scalability, and energy performance, boosting market penetration. The rise in micro server-embedded IC usage—compact and power-efficient servers tailored for data centres, distributed cloud, and edge computing—is also a factor. As semiconductor advancements continue, microserver ICs will grow more efficient and capable, leading to greater innovation and broader use of microserver systems across industries.

Market Dynamics

Minimal power use and compact size of micro servers drive market growth

Micro servers deliver a valuable mix of low energy use, small physical size, and high efficiency, making them ideal for edge computing, data centres, and IoT setups. In contrast, traditional servers require more space and energy, driving up operational costs and infrastructure demands. Micro servers utilise tailored low-power chips and optimised parts, delivering computing capabilities with reduced energy usage.

• For example, in July 2024, Cambridge GaN Devices (CGD) introduced two packaging options for its ICeGaN power ICs, enhancing thermal efficiency and simplifying inspection. These updates support the creation of compact, energy-saving micro server solutions.

Such micro server options are perfect for high-density environments and help significantly reduce operational expenses for businesses relying on continuous data processing.

Growth in System-on-Chip (SoC) advancements creates tremendous opportunities

Progress in SoC technology plays a central role in the evolution of micro server ICs. SoCs combine elements like CPUs, memory, and network modules into one chip, improving efficiency and performance. This integration helps reduce server size and energy use while boosting data processing abilities.

• For instance, Intel unveiled its Xeon 6 processors in June 2024, claiming up to 2.6x better performance per watt over previous versions. These chips are optimised to work with Intel’s Gaudi AI accelerators and designed for intensive AI tasks like training and inference, improving data centre energy use.

SoCs are becoming essential to modern data centres and cloud systems, offering dense and affordable options to meet the growing demand for computing resources.

Regional Analysis

North America holds a commanding 42% share of the global micro server IC market in 2023, driven by the region’s robust technological ecosystem and sophisticated IT infrastructure. The presence of major technology companies, high demand for advanced computing solutions, and significant investments in cloud computing and edge technologies make North America the largest market for micro server ICs. The U.S., in particular, plays a crucial role due to its established network of data centres and its strong emphasis on innovation in the banking, telecommunications, and information technology sectors. The region's aggressive adoption of 5G technology, IoT solutions, and artificial intelligence further fuels the demand for micro server ICs.

Key Highlights

• The global micro server IC market was estimated at USD 2.39 billion in 2024 and is expected to grow to USD 2.59 billion in 2025 to reach USD 4.87 billion in 2033, exhibiting a CAGR of 8.5% during the forecast period (2025-2033).
• By Component, the market is bifurcated into Hardware and software. Hardware segment holds the largest market share.
• By Processor, the market is bifurcated into Intel, Arm. Intel holds the largest market share.
• By Application, the market is bifurcated into Web hosting and enterprises, Analytics and cloud computing, and Edge Computing. Web hosting and enterprise segments hold the largest market share.
• By End Use, the market is bifurcated into Enterprises, Small Scale Enterprises, Medium Scale Enterprises, Large Scale Enterprises, and Data Centers. Web hosting and enterprise segments hold the largest market share.
• Based on region, the global market is segmented into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. North America dominates the global market.

Competitive Players

1. Intel Corporation
2. Advanced Micro Devices, Inc. (AMD)
3. ARM Holdings (acquired by NVIDIA)
4. Applied Micro Circuits Corporation (AMCC)
5. Marvell Technology Group
6. Broadcom Inc.
7. Cavium (acquired by Marvell)
8. Hewlett Packard Enterprise (HPE)
9. Dell Technologies
10. Super Micro Computer, Inc
11. Quanta Computer Inc.
12. NVIDIA Corporation
13. Fujitsu Limited
14. Cisco Systems, Inc.
15. NEC Corporation
16. Samsung Electronics
17. MediaTek Inc.
18. Ampere Computing
19. NXP Semiconductors
20. Qualcomm Technologies, Inc

Recent Developments

• In April 2024, Supermicro, Inc., a prominent provider of IT solutions specialising in Cloud, AI/ML, Storage, and 5G/Edge technologies, introduced its latest X14 server lineup. These servers are specifically designed to accommodate the forthcoming Intel Xeon 6 processor.
• In March 2024, NVIDIA unveiled the NVIDIA Blackwell platform, enabling global organisations to create and implement real-time generative AI using trillion-parameter large language models with substantial cost reductions and energy consumption compared to earlier technologies.

Segmentation

1. By Component
   1. Hardware
   2. Software
2. By Processor
   1. Intel
   2. Arm
3. By Application
   1. Web hosting and enterprises
   2. Analytics and cloud computing
   3. Edge Computing
4. By End Use
   1. Enterprises
   2. Small Scale Enterprises
   3. Medium Scale Enterprises
   4. Large Scale Enterprises
   5. Data Centers
5. By Region
   1. North America
   2. Europe
   3. Asia-Pacific
   4. Latin America
   5. The Middle East and Africa