Hewlett-Packard Enterprise held its first-ever Artificial Intelligence Day in Wisconsin to showcase its plans for AI data centers.
This event game gives a sneak peek at how the company intends to dominate the fastest growing business segments in the data centre supply chain.
By 2027, the Total Addressable Market for Data Centers is expected to be $171 billion. HPE is interested in a growth rate of 25% per year.
To achieve its goal, the company will focus on Direct Liquid Cooling solutions and networking products.
These two segments will likely see a huge growth, largely due to demand driven by AI service providers.
HPE launches new products
HPE has a large presence in the AI Data Centers market. It showcased its products at an artificial intelligence conference, which it thinks will allow it to dominate the market.
The highlight of this event was HPE ProLiant Compute XD685.
This server is powered by AMD’s EPYC processors.
This system is intended to be integrated into AI clusters for complex tasks and large-scale language models training.
The company promotes the product, which is a high performance and energy efficient solution.
Cray EX, a fanless liquid-cooled system.
The HPE cashing on networking and DLC Demand
HPE purchased Juniper Networks earlier this year for $14 billion. By 2027, the networking market is predicted to reach $135 billion.
HPE is well positioned to offer solutions for the increasing complexity of network systems.
Management believes that networking will be one of the largest revenue-generating areas after the AI Server market.
Data center services can only be limited, whereas networking services can scale to all parts of the world.
This limitation doesn’t stop the company becoming a leading player in cooling server technologies.
In the next three years, hyperscalers will grow 30% faster than AI services providers.
The demand for liquid-cooling solutions will be a major factor in this growth.
HPE direct liquid cooling systems will lead the growth in the coming years.
The AI event may prove that the company has the capability to offer the best possible solutions to their customers but it will not fix the issue of the shrinking profit margins.
The management is expecting a revenue increase of 1-3% this year.
The company’s multipliers would continue to be depressed and offer a great opportunity for a buy.
As soon as the AI-induced acceleration kicks in and the company grows at the pace of its peers while the margins increase, it is likely that a rating re-rating would be forthcoming.
The management has set a goal to accomplish all of these goals by the fiscal year 2025.
The COINPAPER published a post entitled Here’s How HPE Plans to Dominate the AI Server Market.