United States Data Center Server Market Size and Share
United States Data Center Server Market Analysis by Mordor Intelligence
The United States data center server market is valued at USD 31.29 billion in 2025 and is on course to reach USD 51.05 billion by 2030, reflecting an 8.5% CAGR. Server demand is benefiting from a synchronized hyperscaler capital-expenditure cycle, the rapid spread of enterprise AI workloads, and new federal incentives for on-shore semiconductor manufacturing. Hyperscalers alone disclosed USD 676 billion of fresh data-center investment intentions in January 2025, with AWS and Microsoft earmarking USD 100 billion and USD 80 billion, respectively, for United States build-outs. AI workload growth is redefining server refresh rates, cutting lifecycles from six to five years as firms pursue higher density and liquid-cool-ready racks. Conversely, cybersecurity breaches averaging USD 5.56 million per incident and have twelve-month lead times for high-bandwidth memory, temper near-term deployment schedules.
Key Report Takeaways
- By tier, Tier 3 facilities led with 66.34% of the United States data center server market share in 2024, while Tier 4 is forecast to grow at 13.2% CAGR to 2030.
- By form factor, half-height blades held 49.2% share of the United States data center server market size in 2024; quarter-height micro-blades are advancing at 14.3% CAGR.
- By application, virtualization and private cloud retained 38.5% share of the United States data center server market, and AI/ML workloads are expanding at 16.3% CAGR.
- By data-center type, colocation captured 65% of the United States data center server market share in 2024, while hyperscaler deployments show the fastest 15.2% CAGR.
- By end-use industry, IT & telecom represented 26.24% of revenue in 2024, as government and defense workloads accelerate at 13.2% CAGR.
- Dell Technologies, HPE, AMD, Intel, and NVIDIA together command an estimated majority of server revenue, with Dell reporting record USD 6.3 billion in Q1 FY26 sales.
United States Data Center Server Market Trends and Insights
Drivers Impact Analysis
Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
---|---|---|---|
Rapid hyperscaler CAPEX cycle renewal | 2.3% | Global, concentrated in Virginia, Oregon, Texas | Medium term (2-4 years) |
Enterprise AI/ML workload proliferation | 2.8% | National, with early gains in California, New York, Washington | Short term (≤ 2 years) |
Edge-cloud convergence boosting micro-server demand | 1.4% | APAC core, spill-over to tier-2 US cities | Medium term (2-4 years) |
Government incentives for domestic semiconductor/Server manufacturing | 1.2% | National, focused on Arizona, Ohio, Texas | Long term (≥ 4 years) |
U.S. power-availability contracts favor liquid-cool-ready racks | 0.7% | Regional, concentrated in Pacific Northwest, Texas | Medium term (2-4 years) |
Tier-2 city tax abatements attracting second-wave data-center builds | 0.6% | National, with early gains in Phoenix, Columbus, Austin | Medium term (2-4 years) |
Source: Mordor Intelligence
Rapid hyperscaler CAPEX cycle renewal
Amazon, Microsoft, Google, and Meta together plan more than USD 320 billion in 2025 data-center outlays, lifting server replacement cycles to five years as firms chase AI compute density. Amazon’s USD 100 billion allocation alone adds an estimated USD 700 million operating-income drag because of accelerated depreciation, yet shortens payback periods for advanced liquid-cooled racks. Federal agencies are mirroring the trend; sixteen Department of Energy sites have been fast-tracked for server-dense builds expected online by 2027, reinforcing demand peaks in Virginia and Oregon.[1]U.S. Department of Energy, “DOE Identifies 16 Sites for AI Data Centers,” Energy.gov, energy.gov
Enterprise AI/ML workload proliferation
Financial institutions cite 84% executive concern over catastrophic data loss if AI infrastructure falls short. Accuracy levels of only 21% in banking models spur investment in servers optimized for vector processing and larger memory footprints. Healthcare systems leverage AI for diagnostics and documentation, driving rack densities up to 50 kW. Manufacturing groups adopt Industry 4.0 applications on edge nodes, combining 5G and micro-data-center form factors. Lenovo’s ThinkSystem V4 platform demonstrates 2.5× rack density and 2.4× performance-per-watt gains, underlining efficiency goals.
Edge-cloud convergence boosting micro-server demand
Latency-sensitive services—from interactive gaming to smart-factory analytics—are relocating compute near end users through transportable 20-foot micro facilities. Early rollouts in Austin, Tampa, and Raleigh show hyperscalers leasing edge racks to improve content delivery. Dallas has become a Local Zone hub as Verizon deploys 5G Edge on AWS Wavelength. Compact quarter-height blades, liquid cooling, and modular enclosures together define preferred architectures for these distributed sites.
Government incentives for domestic semiconductor manufacturing
CHIPS-Act grants of USD 6.6 billion to TSMC plus associated state-level tax credits underpin USD 65 billion of foundry builds in Phoenix. Target output includes advanced AI accelerator dies and server CPUs. Intel collaborates with AWS on custom silicon while Micron lines up HBM production aligned to domestic fabs. Policymakers want 20% of leading-edge nodes on-shore by 2030, cutting reliance on Asian supply chains and stabilizing server bill-of-material costs.
Restraints Impact Analysis
Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
---|---|---|---|
Rising frequency and cost of cyber-intrusions | -1.8% | Global | Short term (≤ 2 years) |
Supply-chain volatility for key silicon (HBM, GPUs) | -2.1% | Global, with acute impact on US hyperscalers | Short term (≤ 2 years) |
Grid-interconnection delays exceeding 24-months in PJM & MISO | -1.3% | PJM & MISO regions (Mid-Atlantic, Midwest) | Medium term (2-4 years) |
New EPA ENERGY STAR v4 idle-power caps constraining legacy refresh | -0.4% | National | Long term (≥ 4 years) |
Source: Mordor Intelligence
Rising frequency & cost of cyber-intrusions
Average breach costs of USD 5.56 million in 2024 combined with downtime expenses exceeding USD 100,000 per event elevate total cost of ownership. Forty-two percent of banks have migrated AI workloads away from public clouds amid security fears, prompting on-premises build-outs that elongate procurement cycles and increase CapEx. Ransomware events, such as CloudNordic’s total customer data loss, illustrate worst-case scenarios compelling wider adoption of zero-trust architectures and biometric access controls.
Supply-chain volatility for key silicon (HBM, GPUs)
Extended twelve-month lead times for HBM stacks and a TSMC CoWoS packaging bottleneck hinder AI server shipments. SK Hynix export volumes fell 30% sequentially in January 2025, and proposed tariffs threaten to lift component costs by up to 30%. NVIDIA still holds 98% of data-center GPU shipments, making the ecosystem highly sensitive to its production cadence.
Segment Analysis
By Data-Center Tier: Fault-tolerant builds accelerate Tier 4 adoption
Tier 3 installations delivered 66.34% of revenue in 2024, anchoring the United States data center server market. Tier 4, though smaller, is projected to rise at 13.2% CAGR as hyperscalers assign AI training clusters to fully fault-tolerant halls where a single outage can cost over USD 100,000. The United States data center server market size contribution from Tier 4 is projected to grow steeply between 2025 and 2030. Federal programs that earmark sixteen sites for AI-ready builds favor Tier 4 specifications, given 50 kW-per-rack power densities anticipated by 2027.
Tier 1 and Tier 2 designs remain relevant for distributed edge nodes prioritizing cost efficiency over maximum redundancy. Financial-services migration toward Tier 4 also stems from stricter compliance and rising breach penalties. Altogether, the resilience imperative cements Tier 4 as the fastest-moving slice, reshaping colocation upgrade roadmaps and guiding liquid-cooling retrofits.
Note: Segment shares of all individual segments available upon report purchase
By Form Factor: Micro-blade innovation squeezes half-height share
Half-height blades retained 49.2% market share in 2024 on the strength of virtualization workloads. Yet quarter-height micro-blades are climbing at 14.3% CAGR as operators compress racks into 20-foot edge modules. The United States data center server market size for micro-blade deployments is thus on an upward trajectory through 2030. EdgeMicro’s city-center installs and manufacturing-sector Industry 4.0 pilots highlight the swing toward compact, energy-efficient hardware.
Full-height blades continue serving HPC clusters, but power-per-rack limits increasingly favor micro-blades paired with direct-to-chip liquid cooling. Hyperscalers are selectively adopting micro-blade platforms for AI inference nodes, balancing density against memory bandwidth needs.
By Application/Workload: AI/ML surges beyond legacy virtualization
Virtualization and private cloud maintained 38.5% share in 2024, anchoring the United States data center server market. AI/ML workloads, however, are forecast to expand 16.3% CAGR, pulling compute toward GPU-heavy nodes and high-bandwidth memory stacks. This shift underpins Dell’s USD 12.1 billion AI server backlog and amplifies demand for rack-scale liquid cooling.
High-performance computing persists for scientific projects, whereas storage-centric topologies absorb the data deluge from AI training. Healthcare’s adoption of inference engines for imaging and patient engagement drives specialized server procurement, and manufacturing brings low-latency edge AI to plant floors.
By Data-Center Type: Hyperscaler build-outs challenge colocation primacy
Colocation providers commanded 65% revenue in 2024, yet hyperscaler self-builds are running at 15.2% CAGR as integrated power, network, and cooling designs promise lower unit costs for AI. The United States data center server market share advantage enjoyed by colocation players is therefore narrowing over the forecast horizon. Meta, Google, and Amazon together target more than USD 240 billion in near-term investment, embedding liquid-cooled racks and direct-chip cold plates.
Colocation firms respond with AI-ready pods and renewable-energy PPAs. Flexential reports that 51% of enterprises still place edge workloads in colocation sites, signaling continued relevance for hybrid deployments even as hyperscalers stretch campus footprints.

Note: Segment shares of all individual segments available upon report purchase
By End-Use Industry: Government emergence narrows IT/telecom lead
IT and telecom sectors remained the largest buyer group at 26.24% in 2024, but government and defense workloads are growing 13.2% CAGR as federal AI initiatives roll out. The United States data center server industry is therefore seeing procurement diversification that balances commercial and public-sector demand. Department-of-Energy construction plans and AI export-control frameworks guide secure, high-density server specifications.
Financial-services firms report heightened risk concerns, pushing some AI compute onto private racks with enhanced encryption. Healthcare and manufacturing extend edge-server adoption for compliance and predictive-maintenance gains, respectively, broadening the customer mix.
Geography Analysis
Virginia, Oregon, and Texas together form the primary geographic core of the United States data center server market, thanks to competitive power prices, established fiber routes, and hyperscaler zoning incentives. Virginia’s proximity to federal agencies feeds low-latency workloads, whereas Oregon leverages hydroelectric resources and cool ambient temperatures to cut PUE scores. Texas draws development through deregulated energy markets and abundant land, anchoring mega-campus projects from AWS and Microsoft.
Secondary hubs are scaling quickly. Phoenix offers a dry climate and favorable property-tax abatements, while Columbus benefits from centrality to national backbones. Austin marries an expanding tech workforce with airport proximity for supply-chain efficiency. EdgeMicro’s Austin, Tampa, and Raleigh deployments confirm rising investment in tier-2 metros.
Interconnection delays in PJM and MISO pose regional headwinds, with queue times topping 24 months and capacity-auction costs hitting USD 14.7 billion.[2]Advanced Energy United, “Capacity Auction Costs Surge to USD 14.7 Billion,” Advancedenergyunited, advancedenergyunited.org The NERC 2024 assessment projects 15% summer and 18% winter peak-load increases over the decade, underscoring grid modernization needs. California’s server energy-efficiency mandates add compliance layers but also steer buyers toward lower-idle-power nodes, aiding national sustainability targets.
Competitive Landscape
Competition in the United States data center server market is intensifying amid AI-driven demand spikes. Dell Technologies leads shipment revenue, posting USD 6.3 billion in Q1 FY26, and a record USD 12.1 billion AI backlog. Hewlett Packard Enterprise follows with 12.8% server-segment growth in 2024, leveraging its GreenLake platform for hybrid cloud uptake. AMD’s USD 3.9 billion Q4 2024 data-center revenue moved its CPU share past Intel to 27.2% in early 2025, signaling a reshuffled x86 hierarchy.[3]Tom’s Hardware staff, “AMD Overtakes Intel in Data-Center CPU Revenue,” Tomshardware, tomshardware.com
Partnerships are redrawing the field. AMD and Intel formed an advisory consortium to optimize x86 platform compatibility, while Qualcomm re-entered the server CPU arena via a tie-up with NVIDIA. NVIDIA’s Blackwell ecosystem aligns with ASRock Rack and GIGABYTE to seed AI-factory-grade systems. Super Micro Computer advances rack-scale liquid-cooled offerings, and Chemours partners with DataVolt on fluorinated dielectric fluids to manage 50 kW-per-rack heat loads.
Hyperscalers influence supplier roadmaps by locking multi-year deals for AI accelerator volumes, intensifying competition around delivery lead-times and energy-efficiency metrics. Component makers that secure domestic CHIPS-Act funding gain preferred-supplier status, while the broader vendor pool accelerates liquid-cool-ready designs to preserve relevance in high-density aisles.
United States Data Center Server Industry Leaders
-
Dell Technologies Inc.
-
Hewlett Packard Enterprise Company
-
Lenovo Group Limited
-
International Business Machines Corporation
-
Cisco Systems, Inc.
- *Disclaimer: Major Players sorted in no particular order

Recent Industry Developments
- January 2025: Amazon announced a USD 100 billion 2025 capital-expenditure plan for AWS builds, a 20% rise from 2024, and shortened server lifecycles to five years
- January 2025: Microsoft committed USD 80 billion to AI-oriented United States data-center projects, while Meta disclosed USD 65 billion spend intentions
- January 2025: AMD closed the USD 4.9 billion takeover of ZT Systems, cementing server AI capabilities and posting 69% year-over-year data-center revenue growth
- May 2025: Dell recorded USD 6.3 billion server revenue in Q1 FY26 and secured USD 12.1 billion in AI server orders
- April 2025: The U.S. Department of Energy named sixteen federal sites for AI-ready data centers, targeting a 2027 go-live
- May 2025: Qualcomm partnered with NVIDIA to co-design server CPUs, signalling its return to the market.
United States Data Center Server Market Report Scope
A data center server is basically a high-capacity computer without peripherals like monitors and keyboards. It is a hardware unit installed inside a rack, having a central processing unit (CPU), storage, and other electrical and networking equipment, making them powerful computers that deliver applications, services, and data to end-user devices.
The United States data center server market is segmented by form factor (blade server, rack server, and tower server) and by end-user (IT and telecommunication, BFSI, government, media and entertainment, and other end users). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
By Data-Center Tier | Tier 1 and 2 |
Tier 3 | |
Tier 4 | |
By Form Factor | Half-height Blades |
Full-height Blades | |
Quarter-height / Micro-blades | |
By Application / Workload | Virtualisation and Private Cloud |
High-Performance Computing (HPC) | |
Artificial Intelligence/Machine Learning and Data Analytics | |
Storage-centric | |
Edge / IoT Gateways | |
By Data Center Type | Hyperscalers/Cloud Service Provider |
Colocation Facilities | |
Enterprise and Edge | |
By End-use Industry | BFSI |
IT and Telecom | |
Healthcare and Life-Sciences | |
Manufacturing and Industry 4.0 | |
Energy and Utilities | |
Government and Defence |
Tier 1 and 2 |
Tier 3 |
Tier 4 |
Half-height Blades |
Full-height Blades |
Quarter-height / Micro-blades |
Virtualisation and Private Cloud |
High-Performance Computing (HPC) |
Artificial Intelligence/Machine Learning and Data Analytics |
Storage-centric |
Edge / IoT Gateways |
Hyperscalers/Cloud Service Provider |
Colocation Facilities |
Enterprise and Edge |
BFSI |
IT and Telecom |
Healthcare and Life-Sciences |
Manufacturing and Industry 4.0 |
Energy and Utilities |
Government and Defence |
Key Questions Answered in the Report
What is the current value of the United States data center server market?
The market stands at USD 31.29 billion in 2025 and is forecast to reach USD 51.05 billion by 2030.
Which server application is growing the fastest?
AI and machine-learning workloads show the highest growth at a 16.3% CAGR through 2030.
Why are Tier 4 data centers gaining popularity?
Hyperscalers require fault-tolerant environments for AI training clusters, pushing Tier 4 demand to a 13.2% CAGR.
How are supply-chain shortages affecting deployment timelines?
Lead times for high-bandwidth memory and GPUs now stretch to twelve months, delaying AI server installations.
Which regions are attracting new data-center investments beyond traditional hubs?
Phoenix, Columbus, and Austin are emerging as preferred tier-2 locations due to land availability, power pricing, and tax incentives.
Page last updated on: June 29, 2025