Buyers’ Expected Short-Term Spending Changes for HPC Servers, Public Clouds, and Desktops

HPC in the cloud has continued on a strong upward trajectory over the last few years, fueled by a concerted effort from CSPs to address the technical capabilities needed to better run HPC jobs in cloud environments. Many CSPs have bolstered their HPC strengths through hiring HPC experts to speak with HPC customers on application-specific issues, such as porting and running hard HPC jobs in the cloud. Further, CSPs are continuously increasing the platforms offered for HPC with the addition of offerings such as high performance processors, access to bare metal, a variety of accelerator options, high-performance interconnects, multiple storage offerings, as well as software packages valuable to HPC customers. These steps have resulted in dramatic advances in cloud adoption over the past two years, including a major growth year in 2019.

The HPC market is experiencing many challenges and opportunities from the covid-19 virus and its resulting economic impacts. In July 2020, the situation appeared bleak, with a potential for 2020 HPC server revenues being down by as much as 20% year on year. More recently, surveys show an improved outlook, although still with a market contraction of approximately 14% compared with 2019. The Workgroup segment is bearing the near-term brunt of the downside impact.

Covid-related HPC investment impacts are not equally distributed across the vertical markets; several segments are already experiencing increased HPC investments. These include bio/life sciences and government labs. At the same time other verticals are facing a greater negative impact, including oil & gas, manufacturing, and DCC/content distribution