Servers running x86 processors from AMD and Intel used to rule the market, both in units and revenue, less than a decade ago. Today, Arm-based machines command well over 45% of server market revenue, according to data released by IDC. While x86 machines still control 52% of the market in terms of revenue, the real winner is a different category altogether: GPU- and ASIC/FPGA-accelerated systems, which generated over 70% of global server revenue in the first quarter of 2026.

IDC estimates that the global server market generated a record $122.6 billion in revenue in Q1 2026, up 30.4% year-over-year, as spending on AI infrastructure remained particularly strong. Sales of ODM Direct servers—custom machines ordered by hyperscalers running merchant or custom silicon—accounted for 50.2% of revenue (down from 64.1% in Q1 2025) and reached $61.53 billion, up a modest 2.1% year-over-year. By contrast, sales of standard servers from well-known brands grew at a much higher pace, suggesting that branded vendors such as Dell, HPE, and Supermicro won a larger portion of AI infrastructure deployments than they did a year earlier. This shift was probably enabled by accelerating enterprise AI deployment and sovereign AI projects, which tend to buy machines from branded vendors, as well as hyperscalers increasingly turning to well-known suppliers for AI hardware.

Dell remained the largest server supplier by revenue with a 16.5% market share, after its revenue surged 244.1% year-over-year to $20.3 billion, driven by exceptionally strong AI server demand. Supermicro remained in second place with $9.3 billion in revenue and 128.9% growth. Lenovo ranked third with $5.6 billion and 36.5% growth, while IEIT Systems—part of the sanctioned Inspur Group—dropped to fourth after revenue declined 7.0% to $4.0 billion. HPE was fifth with $3.7 billion in revenue, up 17.2%. Other vendors, from Asus to Atos and from ASRock Rack to Gigabyte, commanded 14.8% of the market with $18.11 billion in revenue, up from 13% and $12.21 billion in the same quarter a year ago.

The most striking development is the rise of Arm-powered machines, representing a tectonic shift in the market both to the Arm instruction set architecture in general and to custom-built Arm CPUs designed by hyperscalers. Non-x86 platforms generated $58.7 billion in revenue, a 107.6% increase year-over-year, lifting their share to 47.9%. Most non-x86 systems are Arm-based AI machines—such as Nvidia's NVL72—as well as systems running custom CPUs from AWS, Google, and Microsoft. IBM Z mainframes and IBM Power Systems, which use proprietary non-x86 and non-Arm ISAs, still generate $1 billion or more in revenue. IDC claims that Arm-based machines accounted for more than 95% of non-x86 revenue, meaning Arm-based machines commanded over 45% of server revenues in Q1 2026.

One reason Arm-based machines now command a huge chunk of the server market is their use in systems such as Nvidia's NVL72 Blackwell, which sells for up to $6.5 million per unit. Each NVL72 rack-scale solution carries 36 compute trays with two Blackwell GPUs and one Grace CPU per unit. While unit-wise this represents only 36 processors, in dollar terms a single NVL72 machine costs as much as 928 entry-level single-processor servers priced at $7,000 each, or 433 higher-end dual-processor servers priced at $15,000 each. Given that Nvidia will continue bundling Arm-based Vera CPUs with NVL72 Vera Rubin machines that will be more expensive than their Blackwell predecessors, Arm-based machines will likely account for well over 50% of server market revenue in the second half of this year or in 2027. Nvidia also plans to sell server racks featuring only Vera CPUs for agentic AI applications, which will further drive Arm-based machine sales.

Systems equipped with GPUs produced $68.9 billion in revenue during the quarter, up 24.8% compared to the same period a year earlier, accounting for 56.2% of all server sales. Servers based on other accelerator types, including custom ASICs and FPGAs, expanded to $17.7 billion, up 122.1% year-over-year. Accelerated servers in total earned $86.6 billion in Q1 2026, approximately 70.6% of all server revenue.

By contrast, x86 server revenue declined 2.9% to $63.9 billion, though IDC attributes this weakness to supply limitations rather than deteriorating demand. The market research firm claims that the industry's primary constraint is no longer customer appetite for general-purpose servers, but rather the availability of key components, including CPUs, DRAM, NAND memory, and hard drives. X86 servers remain the industry's working horses, with many using accelerators including ASICs, FPGAs, and GPUs for a wide range of workloads including AI, supercomputing, simulations, encryption, and video transcoding.

AMD and Intel shipped nearly 20 million EPYC and Xeon SP processors for data center systems in 2025, according to Dean McCarron, head and principal analyst at Mercury Research. He believes Nvidia is on track to ship four million Grace and Vera CPUs this year, considerably lower than AMD and Intel's shipments. It is difficult to estimate how many custom Arm-based CPUs are deployed by AWS, Alibaba, Google, and Microsoft, but the scale is certainly in the millions—otherwise these companies could not justify custom silicon development and production.

From a volume perspective, x86 servers remain the most popular machines, and it will likely take time before Arm can challenge x86 in mainstream general-purpose servers. Nonetheless, Arm-based data center CPUs are catching up with x86 in terms of volumes. While Nvidia is on track to ship 4 million CPUs in 2026 and other developers of custom Arm-based CPUs are not standing still, x86's 20 million data center processors annually remain untouchable for Arm today—though this may change in coming years.

IDC classifies revenue according to which company invoices the customer, not necessarily who manufactures the hardware. While many AI servers are built by ODMs like Compal, Foxconn, or Quanta, they are sold under brands like Dell or HPE. This classification means that while branded vendors receive credit for enterprise and sovereign AI deployments, major ODMs are not losing business—they are actually gaining it as the appetites of hyperscalers grow.