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TrendForce reveals that although the overall environment this year has been impacted by AI budget constraints—leading to slower-than-expected growth for general—recent procurement strength for related components such as BMCs and new CPUs indicates an improving trend for new server platforms among OEMs and CSPs. Additionally, surveys of ODM supply chains reveal that server shipments, after a seasonal dip in the first quarter, are expected to show sequential growth in the second and third quarters.
OEMs and CSPs are more aggressively preparing CPUs compared to previous periods. Both Intel's Sapphire Rapids and Emerald Rapids, as well as AMD's Bergamo and Genoa, are showing significant growth thanks to increased cloud-related demand. In the BMC sector, strong procurement momentum, particularly for the GB200, and stockpiling by Chinese companies are leading to larger orders at the end of Q2 and into Q3. TrendForce expects bit shipments to exceed initial forecasts, with DDR5's share rising to the 60% mark in Q3.
TrendForce has observed that server demand will increase from Q2 to Q3, with enterprise OEMs—such as Dell, HPE, and Lenovo—showing the most significant shipment growth. This growth is driven not only by strong demand for AI servers but also by tenders postponed due to the pandemic and the rising need for AI-driven storage servers. As a result, Q2 shipment performance has been strong and is expected to continue into Q3, with an estimated quarterly growth of 4-5%.
For Chinese companies, although regional economic conditions have not fully recovered, government-led telecom tenders in China are set to begin this month, boosting demand for orders for companies such as IEIT and xFusion. In the CSP sector, ByteDance is increasing its server procurement for new business needs, while Alibaba and Tencent are raising their server orders due to upgrade cycles.
TrendForce believes it is essential to monitor whether current demand can sustain server growth, but recent component procurement momentum indicates that the previous displacement effect of general servers by AI servers is gradually diminishing.
