HBM Market 'Booming' Due to Rising AI Server Demand... Up to 45% Annual Growth

AI Server Demand Expected to Grow at an Annual Rate of 10.8%
HBM Market to Expand by 40-45% by 2025

With the ChatGPT effect driving increased demand for artificial intelligence (AI) servers, the high-bandwidth memory (HBM) market, which is installed in these servers, is also poised for significant expansion. It is forecasted that the HBM market could achieve an average annual growth rate of up to 45% by 2025.

On the 8th, market research firm TrendForce stated, "Global cloud companies will continue to invest more in AI servers for several years." HBM is a high-performance memory product that increases bandwidth to accelerate data transfer speeds. To smoothly support AI services on servers, the installation of HBM alongside graphics processing units (GPUs) is essential.

Annual AI Server Shipment Volume and Compound Annual Growth Rate (CAGR) Forecast Graph /
[Image provided by TrendForce]

TrendForce noted that "HBM currently accounts for 1.5% of the total DRAM market." They also predicted that "the HBM solution market will exhibit a compound annual growth rate (CAGR) of over 40-45% from 2023 to 2025."

As the HBM market grows, the suppliers expected to benefit include ▲Samsung Electronics ▲SK Hynix ▲and the US-based Micron. TrendForce highlighted, "SK Hynix is the only company capable of mass-producing HBM3 (the latest 4th generation HBM) adopted by Nvidia (GPU supplier)," adding that "it is expected to become the dominant HBM3 supplier."

TrendForce projected an 8% growth rate in AI server shipments this year. The increase in AI services, including chatbots, is driving higher demand for related servers. From 2022 to 2026, AI server shipments are expected to grow at an average annual rate of 10.8%. Last year, 66.2% of AI server shipments were accounted for by Google, Amazon Web Services (AWS), Meta, and Microsoft (MS).

In the server GPU market, the mainstream products include Nvidia's H100, A100, A800, and AMD's MI250 and MI250X series. In this market, Nvidia holds about 80% market share, while AMD holds about 20%.