Data Center Accelerator Market Size, Share & Industry Analysis, By Accelerator Type (GPU, ASIC, FPGA, DPU/IPU/SmartNIC and Others), By Deployment (Cloud, On-premise and Hybrid), By End-user (Hyperscalers/CSPs and Colocation Providers and Enterprises) and Regional Forecast, 2025-2032

The global data center accelerator market size was valued at USD 22.78 billion in 2024. The market is projected to grow from USD 29.38 billion in 2025 to USD 178.43 billion by 2032, exhibiting a CAGR of 29.39% during the forecast period.

Data center accelerator refers to a specialized hardware including AI accelerators, GPUs, FPGAs and ASICs that are designed to augment the computing performance for tasks such as analytics, AI, and high performance workloads. The market is growing steadily driven by the increase in cloud services adoption, data traffic, demand for energy efficient and faster processing, as well as surging AI and machine learning workloads.

Different key players operating in the market include NVIDIA Corporation, Advanced Micro Devices, Inc., Intel Corporation, Google LLC, Amazon Web Services, Inc., Microsoft Corporation and others. These companies use strategies such as developing advanced AI-optimized chips, offering customized accelerator architectures, forming partnerships with different cloud providers and investing rapidly in research and development for higher throughput and lower power consumption.

MARKET DYNAMICS

Market Drivers

Growing Demand for Generative AI and HPC Applications Drives the Market Development

The rapidly growing demand for High Performance Computing (HPC) and AI applications is a prominent driver boosting the data center accelerator market growth. Various generative AI models including large language models, autonomous systems and image generators demand massive parallel processing as well as low-latency computation that is difficult to gain through conventional CPUs.

Similarly, HPC workloads across scientific simulations, research and advanced analytics are based on accelerators to monitor the complex calculations at a scale. With enterprises, research institutions, and cloud providers adopting such technologies, the demand for AI accelerators, GPUs and specialized hardware is expected to surge, thus boosting the market growth.

Market Restraints

High Cost and Power Consumption of Accelerators to Deters the Market Growth

The higher power consumption and cost act as a major challenge for the market growth. Advanced FPGAs, GPUs, and AI chips demand a significant capital investment, thus making its adoption challenging for smaller and cost-sensitive data centers. Their growing operational cost especially cooling requirement and electricity usage also increases the total cost. With accelerators becoming more powerful, the demand for energy is rising, thus creating an efficiency challenge and limiting the deployment across regionals with sustainability regulations and higher energy prices.

Market Opportunities

Rising Adoption of Edge and Cloud AI Infrastructure Offers Lucrative Growth Opportunities

The growing adoption of cloud AI infrastructure and edge Ai provides a lucrative opportunity for the market. With companies shifting the AI processing to cloud based solutions and deploying edge devices to gain real time data, the demand for high performance and lower latency accelerators in growing.

Additionally, cloud providers are demanding scalable FPGA, GPU and ASIC solutions that aids in handling complex AI workloads, whereas, edge environment demands an energy efficient and compact accelerator. This expansion enables vendors to provider a specialized and diverse hardware across both the ecosystems.

DATA CENTER ACCELERATOR MARKET TRENDS

Shift Toward AI-Optimized Data Centers Has Emerged as a Prominent Market Trend

A major trend reshaping the market is growing shift toward AI-optimized data centers driven by the expansion of machine learning, AI and generative AI workloads. Traditional data center architectures are inefficient to meeting the massive memory and computational needs of AI models. This enables operators to adopt GPUs, custom AI accelerators and TPUs.

Such AI centric designs tend to improve the throughput, enhance energy efficiency and reduce the latency. Cloud providers and enterprises also restructure the infrastructure to support the large scale training and inference, thus integrating the specialized hardware, networking solutions and software stacks.

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SEGMENTATION ANALYSIS

By Accelerator Type

Exceptional Versatility of GPU in Parallel Processing Boosts the Segment Growth

Based on accelerator type, the market is segmented into GPU, ASIC, FPGA, DPU/IPU/SmartNIC and Others.  

In 2024, GPU segment held the largest data center accelerator market share and with a revenue of USD 6.52 billion. This is due to its exceptional versatility in parallel processing, making it ideal for machine learning, AI and HPC. Additionally, its flexibility, efficiency in handling complex workloads, and stronger software ecosystem also strengthens the segment growth.

The ASIC segment held highest CAGR of 33.45% in 2024. This growth is attributed to its exceptional efficiency, speed, and optimization capability for specific tasks including AI inference and encryption. Its customized architecture tends to reduce the power use and boosts the performance, making it highly ideal for large-scale data center workloads.

By Deployment

Flexibility, Scalability and Ability of Cloud Solutions Drives Segment Growth

The market is divided into cloud, on-premise, and hybrid, based on deployment.

Among these, cloud segment dominated the market with a revenue share of USD 6.92 Billion in 2024. This segment also held highest CAGR of 31.20% in 2024. The segment’s dominance is attributed to the cloud’s flexibility, scalability and ability to support the resource intensive analytics and AI workloads, thus driving the rapid adoption of high-performance accelerators.

On the other hand, the on premise deployment holds the second-largest market share due to different organizations prioritizing maximum security, performance and control for sensitive data and critical workloads. Additionally, industries including healthcare, finance, and government prefer on-site infrastructure to ensure minimize data exposure, compliance and achieve consistent high speed processing without reliance on external cloud environments.

By End User

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Massive Infrastructure Investments Drive Hyperscalers/CSPs Segment Growth

The market is divided Hyperscalers/CSPs, colocation providers, and enterprises based on end user.

Among these, the Hyperscalers/CSPs segment dominated the market with a revenue share of USD 6.49 billion in 2024. The segment also held highest CAGR of 31.38% in 2024. This growth stems from the massive infrastructure investments, ongoing deployment of advanced accelerators to boost performance, rapid expansion of AI workloads, higher scalability and efficiency across the global cloud platforms.

Enterprises holds the second-largest share in the market due to its increasing reliance on accelerators to augment the performance for internal workloads including data analytics, AI, automation and real time decisions.

DATA CENTER ACCELERATOR MARKET REGIONAL OUTLOOK

Geographically the market is segmented into North America, Europe, Asia Pacific, South America and Middle East & Africa.

North America

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The North America regional market is growing significantly and is expected to hold a share of USD 8.77 billion in 2025. The region holds second largest share backed by the advancements in digital infrastructure, widespread adoption of AI and stronger cloud usage. Additionally, presence of major tech companies and hyperscale data centers across the U.S., further drives the demand for high-performance accelerator technologies across the region. The U.S. leads the regional market with an expected revenue share of USD 5.21 billion in 2025.

Europe

The Europe region is growing with an expected share of USD 5.72 billion in 2025. This growth is driven by the presence of major cloud providers, growing adoption of AI and rapid deployment of digital technologies across the region. Additionally, stronger investments in advanced computing infrastructure and government based digital programs also reinforces the region’s position as a major market contributor. U.K., Germany, and France are some of the major contributors to the market growth with an expected revenue share of USD 1.41 billion, USD 1.21 billion and USD 1.09 billion respectively by 2025.

Asia Pacific

Asia Pacific region dominated the market with a share of USD 7.19 billion in 2023, USD 9.34 billion in 2024 and is expected to reach USD 12.16 billion in 2025. The region is also noticing fastest growth rate majorly due to rising cloud adoption. Additionally, the surge in digitalization and large-scale data center expansion across major economies boosts the overall regional market growth. India and China are the major contributors for the market growth with an expected revenue share of USD 2.24 billion and USD 3.51 billion by 2025.

South America and Middle East & Africa

The markets in South America and Middle East & Africa are growing with an expected share of USD 1.62 billion and USD 1.10 billion respectively in 2025. This regional is growing slowly as compared to other regions due to limited technological investments, slower adoption of advanced data center infrastructure, AI driven workloads and lower cloud adoption. GCC countries are predicted to have a market share of USD 0.35 billion by 2025.

COMPETITIVE LANDSCAPE

Key Industry Players

Key Players Are Focusing on Investing Research and Development to Sustain their Market Positions

The data center accelerator industry is highly competitive with key players including NVIDIA Corporation, Advanced Micro Devices, Inc., Intel Corporation, Google LLC, Amazon Web Services, Inc., Microsoft Corporation and others operating in it. These companies are focusing on partnerships, vertical integration, and growing investments in research and development.

LIST OF KEY DATA CENTER ACCELERATOR COMPANIES PROFILED

• NVIDIA Corporation (U.S.)
• Advanced Micro Devices, Inc. (U.S.)
• Intel Corporation (U.S.)
• Google LLC (U.S.)
• Amazon Web Services, Inc. (U.S.)
• Microsoft Corporation (U.S.)
• Huawei Technologies Co., Ltd. (China)
• Cerebras Systems, Inc. (U.S.)
• SambaNova Systems, Inc. (U.S.)
• Graphcore Ltd. (U.K.)

KEY INDUSTRY DEVELOPMENTS

• In November 2025, Google announced its plan to launch TPU AI chips into space. The company will partner with Planet Labs on 'Project Suncatcher,' which will initially see two satellites launch by early 2027 to explore the potential of larger-scale space data center clusters.
• In October 2025, Qualcomm Technologies, Inc. announced the launch of its next-generation AI inference-optimized solutions for data centers. the Qualcomm AI200 and AI250 chip-based accelerator cards, and racks. Building off the Company’s NPU technology leadership, these solutions offer rack-scale performance and superior memory capacity for fast AI inference at high performance per dollar per watt—marking a major leap forward in enabling scalable, efficient, and flexible generative AI across industries.
• In June 2025, Amazon announced plans to invest a new total of USD 12.9 billion from 2025 to 2029 to expand, operate, and maintain its data center infrastructure in Australia. The country’s largest publicly-announced global technology investment will support the strong growth in customer demand for cloud computing and artificial intelligence (AI), accelerating AI adoption and capability, and the continued modernization of Australian organizations of all sizes.
• In February 2025, AMD announced the launch of Instinct MI325X accelerators with 256GB HBM3e memory and 6TB/s bandwidth, assuring 1.4x higher inference performance as compared to competitors and allowing businesses to attain better results with less GPUs.
• In January 2021, NVIDIA Corporation has expanded its vGPU software to help workstations and AI applications run faster. With the company's virtual GPU (vGPU) technology, Organizations can deliver greater scalability and performance to their employees by using GPU-accelerated virtual machines from the data center or cloud.  

REPORT COVERAGE

The global report provides a detailed analysis of the market and focuses on key aspects such as prominent companies, deployment modes, types, and end users of the product. Besides this, it offers insights into the data center accelerator market trends and highlights key industry developments and market share analysis for key companies. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.

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Report Scope & Segmentation