Bernstein lifts AI server forecast, sees $1T market by 2028

Bernstein has raised its forecast for global server and GPU AI server shipments, projecting compound annual growth rates of 15% and 22% respectively through 2028, as AI infrastructure spending enters what analysts describe as an unprecedented expansion phase.

Accelerating Shipments

In its second-quarter 2026 AI tracker released on Monday, the investment bank said it now expects 8-GPU equivalent server shipments to grow 48% this year, with total rack shipments reaching 61,000 units in 2026 and 88,000 units in 2027. Both Nvidia's ↗ 3.43% Rubin rack and AMD's Advanced Micro Devices, Inc. ↘ 7.04% Helios rack are scheduled to begin shipping in the fourth quarter of 2026. The firm projects the global server market will exceed $1 trillion by 2028.investing+1

The upgraded forecast comes as TrendForce separately revised its 2026 AI server shipment growth estimate upward from 28% to nearly 31% year-over-year, reflecting broad consensus that demand continues to outpace earlier projections.trendforce

A Trillion-Dollar Investment Wave

Total planned and in-construction data center investment now stands at approximately $1.2 trillion, according to Bernstein. Following second-quarter earnings, market estimates for major cloud providers' 2026 capital expenditure rose nearly 15% compared to March projections, with total capex expected to reach around $1.1 trillion by 2027.primexbt+1

Bank of America analyst Vivek Arya echoed the scale of spending, noting that 2026 hyperscaler capex now exceeds $860 billion, representing 80% year-over-year growth, with a path toward approximately $1.2 trillion by 2027. Across the top four cloud providers, cloud computing backlogs now exceed $2.3 trillion, up 16% from the first quarter.finance.yahoo

Meta ↗ 0.14% announced its $50 billion Hyperion project alongside a $14 billion venture with BlackRock ↗ 0.22% for an El Paso data center. SoftBank Group said it will launch neocloud services targeting 10 gigawatts of capacity by around 2030 and invest up to $85 billion in French data center capacity.investing

Custom Silicon Gains Ground

Bernstein projects application-specific integrated circuits will represent approximately 45% of total CoWoS-based AI chip shipments. Broadcom ↗ 0.03% secured a long-term agreement with Google Alphabet Inc. ↘ 4.05% to develop future generations of its Tensor Processing Unit, while Marvell ↘ 3.46% is ramping ASICs for all four major cloud providers. Google's TPU shipments alone are expected to grow roughly 90% year-over-year in 2026.primexbt+1