New Omdia Forecast: AI Data Center Chip Market to Hit $286bn, Growth Likely Peaking as Custom ASICs Gain Ground
The boom in drove a substantial upward revision of the forecast:
鈥淭he key drivers of growth are the adoption of AI applications, the increasing democratization of AI fine-tuning, and the use of reasoning models, which generate large numbers of tokens that are not used in the final output,鈥� says . 鈥淥n the other hand, the shift towards smaller, specialized models is slowing demand for AI computing, as are generation-on-generation improvements in AI model efficiency. These improvements include better curation of training datasets, advances in fundamental model design, and operational optimizations in inference.鈥�
Although NVIDIA remains the dominant vendor, Omdia observes that alternatives to GPUs are gaining traction in 2025. These include both custom ASIC chips such as Google鈥檚 TPUs, and merchant ASSPs including Huawei鈥檚 Ascend series, Groq, or Cerebras. AMD has also made significant progress with its Instinct line of GPUs, boosted by major software investments in 2024.
The newly available Omdia forecast covers GPUs, AI ASICs and ASSPs, FPGAs for AI applications, and CPUs with integral AI acceleration hardware, and provides estimates by market segment, global region, vertical industries, applications, memory content, compute performance, and power consumption bands.
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, part of Informa TechTarget, Inc. (Nasdaq: TTGT), is a technology research and advisory group. Our deep knowledge of tech markets grounded in real conversations with industry leaders and hundreds of thousands of data points, make our market intelligence our clients鈥� strategic advantage. From R&D to ROI, we identify the greatest opportunities and move the industry forward.
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Fasiha Khan: [email protected]
Source: Omdia
