Investing.com -- Barclays raised its AI server revenue estimates following discussions with industry players and an analysis of market trends.
The bank now expects AI server revenues to reach $214 billion in 2025 and $292 billion in 2026, marking significant growth from its previous projections of $204 billion and $254 billion, respectively.
“We increased our AI server revenue forecasts, given continued strength in hyperscaler capex and focus on technical infrastructure investments,” Barclays (LON:BARC) analysts wrote.
The firm now models AI server revenue growth of 51% in 2025 and 37% in 2026, up from prior estimates of 46% and 25%.
Traditional servers are also expected to recover gradually, particularly in 2026. Barclays forecasts mid-single-digit to high-single-digit revenue growth for Traditional servers in 2025-26, supported by easier comparisons from previous years and improving enterprise demand.
“We assume current macro uncertainty may push further enterprise recovery upside into CY26 more so than we had previously estimated,” the analysts noted.
Barclays also commented on key industry players. Dell’s AI server revenue fell short last quarter due to the Blackwell transition, though the company maintains a $9 billion AI server backlog.
They note that HPE posted $900 million in AI server revenues last quarter, slightly below Barclays’ $1 billion estimate, but its traditional server revenue grew 16% year-over-year, indicating early signs of enterprise recovery.
Meanwhile, Supermicro (SMCI) remains an early mover in AI servers, but Barclays maintains an Equal-Weight rating on the stock, citing weaker competitive positioning, high working capital requirements, and governance concerns.
“The server market has been a tale of two cities, with AI growth materially diverging from Traditional over the past few years. We expect growth from both AI and Traditional servers moving into CY25-26,” Barclays concluded.