GPU as a Service Market Size, Share & COVID-19 Impact Analysis, By Deployment Model (Private GPU Cloud, Public GPU Cloud, and Hybrid GPU Cloud), By Enterprise Type (Small & Medium-sized Enterprises and Large Enterprises), By Application (Healthcare, BFSI, Manufacturing, IT & Telecommunication, Automotive, and Others), and Regional Forecasts, 2023-2030

The GPU as a Service market size was valued at USD 2.39 billion in 2022 and is projected to grow from USD 3.16 billion in 2023 to USD 25.53 billion by 2030, exhibiting a CAGR of 34.8% during the forecast period. North America dominated the global market with a share of 39.75% in 2022.

GPU as a Service (GPUaaS) is the use of GPUs from a cloud environment when there is a need to process large amounts of data for scientific simulations, deep learning, video rendering, financial risk analysis, and other tasks. A GPU as a Service provider completely manages the GPUs and offers users to rent computing power through a subscription-based model or by the hour. A server with a single GPU can outweigh the performance of dozens of CPU-based servers. This increases the speed of training the machines and deep learning models that drive Artificial Intelligence (AI) applications.

The significant growth of the GPU as a Service industry is majorly attributed to the increased adoption of machine learning and AI-based applications across various industries such as finance, healthcare, and automotive. According to the IBM Global AI Adoption Index 2022, the global AI adoption rate rose to 35%, a four-point increase from 2021. This factor is propelling the demand for cost-effective and scalable computing resources, which, in turn, has given rise to GPU as a Service, which offers on-demand access to GPUs for parallel computing.

To meet the rising demand for robust computing resources, such as GPUs, many cloud companies in the market are offering GPU as a Service solutions to individuals and businesses. For instance,

• In April 2023, Catalyst Cloud, a New Zealand-based cloud infrastructure and platform services company, released NVIDIA’s GPUaaS solution. The company will offer NVIDIA A100 GPU cards to the New Zealand marketplace at a competitive price.

COVID-19 IMPACT

Increased Cloud-based Services Adoption During COVID-19 Pandemic Augmented Market Growth

The COVID-19 pandemic offered ample growth opportunities for the market on account of the surge in adoption of cloud services across the world and in various industries. According to "The Flexera 2020 State of the Cloud Report", 27% of leaders noted a substantial increase in cloud spending owing to the pandemic. Due to the uncertainty posed by the pandemic, many small, medium, and large organizations shifted their operations to cloud and adopted online productivity and collaboration services. Cloud migration allowed businesses to assign more funds for Research and Development (R&D) in the areas of Machine Learning (ML) and Artificial Intelligence (AI).

During the pandemic, many organizations increased their investment in IoT and the pace of their IoT projects. This, in turn, augmented the demand for cloud-based GPUs for scaling and accelerating the process. Moreover, leading Graphics Processing Unit (GPU) providers launched products to explore possible cures and vaccines for the novel coronavirus.

• For instance, in May 2020, NVIDIA Corporation launched the A100 graphics processor to perform data-intensive tasks related to genomics, scientific simulation, and AI training.  

LATEST TRENDS

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Surge in Deep Learning, High-Performance Computing (HPC), and Machine Learning (ML) Workloads to Aid Market Growth

The rapid evolution of ML and deep learning has augmented the use of HPC technology by data scientists, engineers, and researchers to process large volumes of data, run analytics, and other applications in lesser time and at a lesser cost than traditional computing. Enterprises in nearly every industry have begun employing GPU-assisted HPC setups for data-intensive computing.

Several leading players in the market are launching GPU as a Service solutions to increase the speed and performance of HPC. For instance,

• In May 2022, atNorth, an HPC and AI solutions provider, launched a GPUaaS solution to accelerate deep learning, HPC, and, ML workloads. atNorth offers massive scale and total sustainable capacity equivalent to 125,000 A100 GPUs, with plans to double this capacity in the upcoming years.

DRIVING FACTORS

Rising Demand for GPU-Intensive Applications Coupled with Technological Advancements to Fuel Market Growth

The rise of GPU-intensive applications, such as scientific computing, 3D graphics rendering, machine learning, blockchain, cryptocurrency mining, and video editing, is expected to propel the GPU as a Service market growth during the forecast period. GPUaaS solutions help individuals and businesses speed up their computing jobs. The growing requirement for more powerful computing is driving the research and development for more powerful and efficient GPUs. Moreover, the increasing trend of remote work and virtualization is anticipated to further supplement the market growth. By employing cloud-based GPU resources, organizations can enable employees to access GPU-intensive applications and perform demanding tasks remotely.

RESTRAINING FACTORS

Data Security Concerns to Hamper Market Growth

Data security is one of the major concerns that is expected to hamper the market growth during the forecast period. Since data is stored and processed on cloud, there is a higher risk of unauthorized access, data loss, and cyberattacks. According to a recent survey report "The 2022 State of Cloud Security" by Snyk, around 80% of enterprises had encountered at least one cloud security incident in 2021, and 27% of companies had observed a public cloud security incident, a 10% rise from 2021. Hence, owing to these factors, GPU as a Service solution providers must assure that they have adequate security measures in place to protect users' data.

SEGMENTATION

By Deployment Model Analysis

Increasing Data Security Concerns to Fuel Private GPU Cloud Demand

Based on deployment model, the market is divided into private GPU cloud, public GPU cloud, and hybrid GPU cloud. The private GPU cloud segment is expected to hold the maximum market share on account of increasing security issues in cloud computing. According to the “State of Cloud Security 2022” report by Snyk Limited, 80% of organizations experienced serious cloud security incidents, such as data leaks and data breaches in 2021. Owing to this factor, organizations are increasingly opting for a private GPU cloud deployment model. The private cloud environment is completely dedicated to a single client. Hence, the infrastructure and systems can be configured to offer high levels of security.

In addition, the hybrid GPU cloud segment is expected to record the highest CAGR during the forecast period on account of various benefits offered by this model such as cost-effectiveness and scalability.

By Enterprise Type Analysis

Large Enterprises to Increase Use of GPU as a Service Solutions to Overcome Challenges Associated with Infra Maintenance

Based on enterprise type, the market is divided into small & medium-sized enterprises and large enterprises. The largest GPU as a Service market share is anticipated to be held by the large enterprises segment. Managing and maintaining a GPU infrastructure is a complex and resource-intensive task. GPUaaS solutions relieve organizations of the burden of hardware management, upgrades, and maintenance.

In addition, the Small & Medium-sized Enterprise (SME) segment is anticipated to register the highest CAGR during the forecast period. SMEs are increasingly adapting to the digital environment to cater to customer requirements globally and stay ahead of the competition in a highly competitive marketplace.

By Application Analysis

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Increasing Volumes of Data to Augment Product Use in IT & Telecommunication

Based on application, the market is segmented into healthcare, BFSI, manufacturing, IT & telecommunication, automotive, and others (aerospace & defense and agriculture).

The IT & telecommunication segment is anticipated to dominate the market during the forecast period. IT & telecommunication companies generate large volumes of data and utilize it to gain insights and improve their services. GPUaaS offers the computational power required for advanced data analytics and machine learning. In the telecommunications sector, GPUaaS can be used for network optimization tasks.

In addition, the manufacturing segment is expected to show the fastest CAGR during the forecast period owing to the rising adoption of High-Performance Computing (HPC) to manage large volumes of datasets for simulation and modeling jobs. GPUs are useful for parallel processing tasks, making them highly effective for running complex simulations and calculations required for product design, material analysis, and validation. GPUaaS solutions offer exceptional computational power required to perform complex simulations faster, helping manufacturers iterate and refine their designs at a rapid pace.

REGIONAL INSIGHTS

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Geographically, the market is studied across five major regions, including North America, South America, Europe, the Middle East & Africa, and Asia Pacific. They are further categorized into countries.

North America is expected to account for the largest market share during the forecast period owing to the presence of major players, increased adoption of AI & ML across numerous industries, including manufacturing, BFSI, healthcare, and aerospace & defense, advancements in computational power, and robust government funding & support for Research & Development (R&D) in AI. The U.S. has maintained its leadership in the North America market on account of continued investment in AI research. According to a report by Stanford University, the U.S. government’s spending on AI contracts reached USD 3.3 billion in the fiscal year 2022. In June 2023, the Government of Canada planned an investment of around USD 40 million to support various AI projects in manufacturing, retail, and aeronautics. These factors have significantly augmented the growth of the AI market which, in turn, has increased the demand for GPUaaS solutions in this region.

Furthermore, the Asia Pacific market is expected to show the highest growth rate during the forecast period. Governments in the region have displayed great interest in AI, with China, Australia, New Zealand, India, and Singapore declaring ambitious national strategies for the same. As per the report “State of Data Science and AI Skills in India: Data and the Art of Smart Intelligence” published by Nasscom, India has the 2nd largest AI/ML/big data analytics talent pool in the world and stands first in terms of AI skill penetration.

The market in Europe is driven by advancements in AI and automation, availability of high-quality digital infrastructure, and strong regulatory frameworks. Among the main European economies in AI, Germany, France, and the U.K. are progressing at faster pace. Various governments in this region have announced funds to support various AI projects. For instance, in April 2023, Innovate the U.K. launched around USD 110 million (EUR 100 million) AI fund for U.K. businesses.

In South America, the emergence of the startup & innovation ecosystem and expansion of cloud computing solutions are expected to drive the regional market growth. Brazil is expected to maintain its leadership position in the region due to the existence of a solid structure to conduct the R&D of advanced technologies. The growth of AI in Brazil has taken place in areas, such as e-commerce, finance, and the public sectors.

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The Middle East & African countries are increasingly adopting digital technologies. The region’s businesses are among the early AI adopters and actively developing various industry-leading use cases. The Gulf Cooperation Council (GCC) countries are increasingly exploring AI as part of their broad economic transformation plans. These nations are employing generative AI technology to rebuild their education systems. Several GCC countries, including the UAE and Saudi Arabia have launched national strategies to equip their economies well enough to incorporate AI. Saudi Arabia’s Vision 2030 initiative is a part of the national AI development plan. These factors are expected to augment the market growth in this region.

KEY INDUSTRY PLAYERS

Key Players Focused on Strengthening their Market Position with Continuous Developments

The global market is consolidated by leading players such as Amazon Web Services, Inc., Google, Microsoft, Vultr, and IBM Corporation. These key players are expanding their operations by adopting strategies such as mergers, acquisitions, product launches, collaborations, and partnerships. For instance, in February 2023, Vultr, a cloud hosting company, announced a cloud GPU availability of the NVIDIA A16, an addition to the NVIDIA A100 Tensor Core GPU and NVIDIA A40 in the Vultr lineup.

List of Key Companies Profiled:

• Alibaba Cloud (China)


• Vultr (U.S.)


• Linode LLC. (U.S.)


• Amazon Web Services, Inc. (U.S.)


• Google (U.S.)


• IBM Corporation (U.S.)


• OVH SAS (Europe)


• Lambda Labs (U.S.)


• Hewlett Packard Enterprise Development LP (U.S.)


• CoreWeave (U.S.) 

KEY INDUSTRY DEVELOPMENTS:

• April 2023: Google, an American multinational technology company, announced A3 supercomputers with NVIDIA’s H100 GPUs. Google Cloud will offer a wide range of GPUs for training and inference of ML models to users. These supercomputers offer up to 26 exaFlops of AI performance, which claims to significantly reduce the costs and time required for training large ML models.


• April 2023: CoreWeave, an NYC-based startup, raised USD 221 million in Series B funding led by Magnetar Capital. CoreWeave offers various Nvidia GPUs in cloud for use cases, such as visual effects & rendering, AI & ML, batch processing, and pixel streaming.


• March 2023: Lambda Labs, a cloud company offering GPUs on-demand in a public cloud, raised USD 44 million in a Series B investment round. The company is planning to deploy thousands of Nvidia's latest H100 GPUs with high-speed network interconnects. Lambda Labs has data centers in San Francisco, Texas, California, and Allen.


• September 2022: Super Micro Computer, Inc., a storage, networking solutions, and computing company, added an 8U Universal GPU server to its GPU server lineup for large-scale AI training. The 8U server is designed for diverse and computationally-intensive workloads built for maximum performance in data centers.


• March 2022: Akamai Technologies, a cloud computing, security, and content delivery service company, completed the acquisition of Linode LLC., a company offering on-demand GPUs for parallel processing workloads. Akamai acquired all the outstanding equity of Linode LLC. for approximately USD 900 million.

REPORT COVERAGE

An Infographic Representation of GPU as a Service Market

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The report offers qualitative and quantitative insights into the market and a detailed analysis of the size & growth rate for all possible segments in the market. It also provides an elaborative analysis of market dynamics, emerging trends, and the competitive landscape. The report offers key insights, such as the implementation of automation in specific market segments, recent industry developments, such as partnerships, mergers, funding, acquisitions, consolidated SWOT analysis of key players, business strategies of leading market players, macro & micro economic indicators, and major industry trends. This detailed analysis provides a comprehensive view of the market and its potential for growth and development.

REPORT SCOPE & SEGMENTATION