EXECUTIVE SUMMARY
This Intersect360 Research report presents the 2020 total market model and five-year forecast for the overall High Performance Computing (HPC) market, segmented into vertical markets across industry, government, and academia. The forecast horizon is from 2021 through 2025, with compound annual growth rates (CAGRs) using 2020 as a base. Because 2020 was anomalous in many ways due to the COVID-19 pandemic; we also show CAGRs using 2019 as the base year.
Intersect360 Research defines HPC as the use of servers, clusters, and supercomputers—plus associated software, tools, components, storage, and services—for scientific, engineering, or analytical tasks that are particularly intensive in computation, memory usage, or data management. Intersect360 Research reports available in this series include the following segmentations:
- Products and Services: servers, storage, networks, software, service, cloud, other
- Vertical markets: academia, national security, national research labs, national agencies, state or local governments, bio sciences, chemical engineering, consumer product manufacturing, electronics, energy, financial services, large product manufacturing, media and entertainment, retail, transportation, other
- Regions: North America, EMEA, Asia-Pacific, Latin America
- Server class (HPC server revenue): entry-level, midrange, high-end, supercomputer
- Cloud categories (HPC cloud revenue): raw cycles, cloud storage, application hosting (SaaS), infrastructure hosting (IaaS, PaaS), other
- Software categories (HPC software revenue): operating environments, developer tools, middleware, storage software, transfer costs, application software, other
- Services categories (HPC services revenue): maintenance and repair, system engineering, system integration, training, programming services, other
- HPC server market shares (current year only, not forecast)
- HPC storage market shares (current year only, not forecast)
Total HPC market revenue fell to $38.9 billion in 2020, down 0.2% from 2019, the first year-over-year market decline since 2009, attributable directly to the economic effects of the global COVID-19 pandemic. The essentially flat market outperformed the 3.7% decline Intersect360 Research had forecast for the year.
More than any other segmentation, our look at vertical markets highlights the very different effects of the pandemic on different types of HPC users. The entire government sector showed growth that exceeded previous steady-state rates, as governments launched effort to combat the pandemic with HPC. This was seen most dramatically in national research labs, which had the highest growth of any tracked vertical market segment. The government sector was joined notably by one single commercial segment, bio-sciences, again in direct response to COVID-19. Other commercial segments underperformed previous growth rates, and in many cases declined year-over-year, often significantly.
Coming off the anomalous 2020, there will be a rebound in HPC spending in 2021, as deferred projects begin to get fulfilled, leading to a short-term 16.4% HPC market gain. In the long run the HPC market will return to steady growth and will exceed $60 billion in 2025, corresponding to a 9.1% CAGR using the down-year 2020 as a base, or a 7.5% CAGR from 2019. Independent of the pandemic effects, national research labs have the highest underlying growth rate, due to the emergence of Exascale computing. The near-term effects of COVID-19 vary significantly by year and by segment; the methodology is fully described in this report.
EXECUTIVE SUMMARY 2
TABLE OF CONTENTS 4
INTRODUCTION 6
What Is HPC? 9
HPC 2020 MARKET PERFORMANCE: VERTICAL MARKETS 10
New Segments 11
Market Performance 12
Table 1: Total HPC Market Revenue ($000), 2020 vs. 2019, by Vertical Market 12
ECONOMIC DYNAMICS OF THE COVID-19 PANDEMIC 13
Figure 1: The Shape of an HPC Recession 15
Figure 2: HPC Revenue ($000) as a Result of 2009 Recession, 2008 – 2013 15
Base Years for Compound Annual Growth Rates: 2019 vs. 2020 16
Table 2: Comparison of Base Years for CAGR Calculations 16
2021–2025 HPC MARKET FORECAST: VERTICAL MARKETS 17
Table 3: Total HPC Market Revenue ($000), 2019-20 Actuals, 2021 to 2025 Forecast, by Vertical Market 18
Table 4: HPC Market Revenue Share, 2019-20 Actuals, 2021 to 2025 Forecast, by Vertical Market 18
Table 5: Year-over-Year Revenue Change, 2020 Actual, 2021 to 2025 Forecast, by Vertical Market 19
Figure 3: Total HPC Market Revenue ($000), 2019-20 Actuals, 2021 to 2025 Forecast, by Vertical Market 20
CONCLUSIONS 21
APPENDIX A: METHODOLOGY 23
COVID-19 24
APPENDIX B: HPC MARKET DYNAMICS MODEL AND FUNDAMENTAL FORECAST ASSUMPTIONS 25
Market Maturity 25
Fundamental Market Dynamics Model 26
Figure A1: Traditional HPC Market Dynamics 27
Fundamental Market Assumptions 28
Fundamental Drivers 28
Fundamental Market Dampeners 29
Model-Based Assumptions 30
Basic Market Drivers 30
Basic Market Dampeners 31