Data Center Interconnect Semiconductor Market to Approach $25 Billion in 2027

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New 650 Group Research Finds that AI Servers, DPUs, CXL and Ethernet Semiconductors will Drive Significant Growth

INCLINE VILLAGE, Nevada, November 15, 2022 – According to a new report published by 650 Group, titled Interconnect Semiconductor Market 2022-2027, the worldwide market for the portion of semiconductors used for interconnect in data centers will approach $25 billion in revenue by 2027.

Interconnect functionality within data centers is the critical infrastructure that allows systems and semiconductors to talk to each other. For two decades, interconnect was taken for granted and included as a piece of every server, storage system, and networking device. However, the expanded use of artificial intelligence (AI), machine learning (ML), server acceleration and memory expansion  combined with the quest for efficiencies in hyperscale, edge, and private cloud infrastructure are causing disruption. These market factors are forcing the industry to reinvent and logically disaggregate the interconnect based on technologies such as Ethernet and Compute Express Link (CXL) to create better economies of scale and efficiencies.

“The interconnect technologies that currently sit in disparate systems and silicon will need to come together to address the scalability and sustainability of cloud and data center computing,” said Alan Weckel, Technology Analyst at 650 Group. “Similar to the offload that occurred in NICs and the scale of Ethernet in the cloud, which allowed those markets to double in size, we expect that the interconnect market will have a higher growth rate than the overall systems market and nearly double in size by 2027 as new products and solutions enter the market.”

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About 650 Group

650 Group is a leading market intelligence research firm for communications, data center, and cloud markets. Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies. 650 Group focuses on leading-edge market trends and research and prides itself on first-to-market research with numerous research programs focused on cloud and technology trends.