Asia Pacific AI Server Market Size, Share & Industry Analysis Report By Processor Type (GPU-based Servers, FPGA-based Servers, and ASIC-based Servers), By Cooling Technology (Air Cooling, Liquid Cooling, and Hybrid Cooling), By Form Factor (Rack-mounted Servers, Blade Servers, and Tower Servers), By End Use, By Country and Growth Forecast, 2025 - 2032

Analysis of Market Size & Trends

The Asia Pacific AI Server Market would witness market growth of 38.1% CAGR during the forecast period (2025-2032).

The China market dominated the Asia Pacific AI Server Market by Country in 2024, and would continue to be a dominant market till 2032; thereby, achieving a market value of $201,011.2 million by 2032. The Japan market is registering a CAGR of 37.1% during (2025 - 2032). Additionally, The India market would showcase a CAGR of 39.4% during (2025 - 2032).

The Asia Pacific (APAC) region has witnessed a remarkable transformation in its AI server market, driven by rapid digitalization, government initiatives, and the proliferation of AI applications across various industries. Countries like China, Japan, South Korea, and India have been at the forefront, investing heavily in AI infrastructure to support their burgeoning tech ecosystems. For instance, Lenovo announced plans to manufacture AI servers in India and opened an AI-centric R&D lab in Bengaluru, aiming to produce 50,000 AI rack servers and 2,400 GPU servers annually to cater to both domestic and international markets.

The evolution of the AI server market in APAC is also marked by significant investments from major players like Foxconn, which forecasts its AI server revenue to exceed NT$1 trillion by 2025, accounting for 50% of its total server revenue and over 40% market share. Such developments underscore the region's commitment to becoming a global leader in AI technology, with a focus on enhancing computational capabilities and fostering innovation. One prominent trend in the APAC AI server market is the emphasis on digital sovereignty and infrastructure development. Governments across the region are investing in AI infrastructure to ensure data security and reduce dependency on foreign technologies.

Asia Pacific AI Server Market Trends

Asia Pacific has emerged as the fastest-growing region in the global AI server market, driven by robust economic digitalization, tech-centric policy frameworks, AI-powered industrial automation, and increasing investments from global cloud service providers. Countries like China, Japan, India, South Korea, Singapore, and Australia are at the forefront of AI infrastructure development, creating a diverse and expansive market landscape for AI servers.

1. China’s National Drive for AI Infrastructure Expansion

China leads AI server deployment in APAC through massive government-backed initiatives and industrial-scale adoption:

• Under the "AI Plus" initiative outlined in its 14th Five-Year Plan, China is integrating AI across sectors like manufacturing, defense, and public services. This push includes widespread deployment of AI server farms for training domestic large language models and automating critical systems.
• Tech giants such as Baidu, Alibaba, Tencent, and Huawei are investing heavily in GPU-rich AI clusters, with Huawei also manufacturing its Ascend AI processors and deploying them in its own server lines.
• In April 2024, Baidu launched its Ernie 4.0 model, supported by high-performance computing centers that operate over 10,000 AI servers across major cities like Beijing and Shenzhen.
• Local governments in provinces such as Sichuan and Zhejiang have incentivized the development of regional AI compute hubs, including the installation of low-energy cooling systems and integration with 5G/6G edge networks.

China’s emphasis on sovereign AI compute aligns with its broader digital sovereignty goals and is significantly accelerating server demand.

2. India’s Public Sector AI and Digital Mission Momentum

India is actively developing its AI server ecosystem through national initiatives focused on public welfare, digital services, and industrial automation:

• The National Programme on AI, coordinated by NITI Aayog and MeitY (Ministry of Electronics and IT), supports the creation of AI compute clusters for public use cases like healthcare diagnostics, agricultural yield prediction, and e-governance.
• India has launched its AI Supercomputer Mission, under which state-owned C-DAC is deploying indigenous AI servers to support research institutions.
• In 2025, the Indian government announced the construction of three national AI cloud data centers, each equipped with over 500 PFLOPS of compute capacity, in Pune, Bengaluru, and Hyderabad.
• Indian IT service providers (Infosys, TCS, Wipro) and startups (Haptik, Arya.ai) are leveraging these AI server capabilities to develop AI-as-a-Service platforms and proprietary generative AI tools.

India’s low power costs and skilled engineering workforce further enhance its appeal for AI server investments.

State of Competition in the Asia Pacific AI Server Market

The Asia Pacific (APAC) region is rapidly evolving into one of the most competitive AI server markets globally. Fueled by government-backed infrastructure rollouts, hyperscaler expansions, and indigenous hardware innovation, APAC’s competitive landscape is shaped by both domestic technology champions and global entrants adapting to regional demands. The diversity across economies—from highly industrialized nations like Japan and South Korea to fast-emerging digital economies in Southeast Asia—makes the competition multi-faceted and dynamic.

1. China’s Homegrown Server and AI Chip Ecosystem

China is aggressively advancing self-reliance in AI server infrastructure through both state policy and corporate execution:

• Huawei, via its Ascend series (e.g., Ascend 910), is developing end-to-end AI server systems and deploying them in government labs, military AI projects, and public clouds.
• Alibaba Cloud, Baidu, and Tencent Cloud are expanding AI server clusters optimized for training large-scale Chinese language models. Baidu’s Ernie 4.0 model runs on proprietary compute architecture across thousands of AI servers.
• The “AI Plus” initiative under China’s national five-year plan mandates deeper AI integration into manufacturing, health, and transport sectors—driving demand for domestic server capacity.
• U.S. export controls on advanced GPUs have pushed Chinese companies to accelerate R&D in domestic AI chips (e.g., Cambricon, Biren Technology), directly intensifying internal competition.

China’s AI server market is increasingly sovereign, competitive, and strategically shielded from external vendors.

2. Japan and South Korea’s High-Performance AI Ecosystems

Japan and South Korea are investing heavily in AI server systems to support automation, smart cities, and advanced robotics:

• Fujitsu and NEC in Japan are competing with both domestic and international firms by offering AI-optimized supercomputers and scalable server racks for enterprises and research.
• Japan’s Society 5.0 vision places strong emphasis on data infrastructure. AI server deployments are part of public initiatives in healthcare, eldercare, and disaster resilience.
• Samsung Electronics and LG CNS in South Korea are leading AI server innovation in memory performance (e.g., HBM3) and edge computing applications.
• Government-funded clusters in Daejeon and Pangyo Techno Valley offer subsidized GPU server access to AI startups and universities.

In both countries, AI servers are increasingly designed for specific use cases—medical imaging, traffic management, or factory automation—enhancing product-level competition.

Processor Type Outlook

Based on the Processor Type, the AI server market is segmented into GPU-based, FPGA-based, and ASIC-based servers. The GPU-Based Servers held the major market share among all the processor types in 2024 followed by FPGA-based Servers.

1. GPU-Based Servers

Trend: The Asia-Pacific region is experiencing significant growth in the adoption of GPU-based servers, driven by the increasing demand for AI applications and the need for high-performance computing.

To illustrate:

• Singtel, a leading telecommunications company in Singapore, announced plans to launch its GPU-as-a-Service (GPUaaS) in Southeast Asia. This service will provide enterprises with access to NVIDIA's AI computing power, facilitating accelerated growth and innovation. The initiative underscores the region's commitment to enhancing AI capabilities through advanced GPU infrastructure.

2. FPGA-Based Servers

Trend: FPGA-based servers are gaining traction in the Asia-Pacific region, particularly in telecommunications and automotive sectors, due to their flexibility and efficiency in handling specific AI workloads.

To illustrate:

• Vodafone and AMD's 5G Infrastructure Development: Vodafone is collaborating with AMD to develop next-generation mobile base stations using AMD's Zynq UltraScale+ RFSoC devices, aiming to enhance 5G infrastructure efficiency.

Cooling Type Outlook

Based on Cooling Technology, the market is segmented into Air Cooling, Liquid Cooling, and Hybrid Cooling.

Air Cooling

Trend: Continued dominance of air-based cooling, evolving through free and economized cooling methods in high-density installations.

To illustrate:

• Free-air/economized cooling in China and Japan: Data centers are increasingly leveraging outside air for cooling, reducing dependency on mechanical chillers. Facilities in China and Japan are noted for this rising implementation of “free cooling” to optimize energy usage.

Liquid Cooling

Trend: Rapid adoption of liquid cooling—especially immersion—driven by rising AI compute density and energy efficiency.

To illustrate:

• Surge in direct liquid and immersion cooling: In APAC, immersion techniques were already capturing a third of the cooling market and continue to grow substantially.

Form Factor Outlook

Based on Form Factor, the Asia Pacific AI Server Market is segmented into Rack-mounted servers, Blade Servers, and Tower servers segment. The Rack mounted server segment garnered the highest revenue share among others in 2024 in Asia Pacific AI Server Market.

Rack-Mounted Servers

Trend: Rack-mounted servers are widely adopted in the APAC region due to their scalability and efficient space utilization, making them ideal for data centers and enterprise environments.

To illustrate:

• Amazon's Investment in Taiwan: Amazon Web Services (AWS) announced plans to invest over $5 billion in the Asia Pacific (Taipei) Region, supporting the construction and operation of data centers in Taiwan. This significant investment underscores the growing demand for scalable rack-mounted server configurations to support regional cloud and AI services.

Blade Servers

Trend: Blade servers are gaining traction in the APAC region, particularly in environments requiring high-density computing and efficient resource utilization, such as virtualization and cloud computing.

To illustrate:

• AirTrunk's Expansion: AirTrunk, a leading data center operator, has expanded its presence across the APAC region, including Australia, Japan, Malaysia, Hong Kong, and Singapore. The company's growth reflects the increasing demand for high-density computing solutions like blade servers to support AI and cloud workloads.

End Use Outlook

Based on the End Use, the Asia Pacific AI Server Market is segmented into IT & Telecommunication, BFSI, Retail & E-commerce, Healthcare & Pharmaceutical, Automotive and Other End Use. The IT & Telecommunication segment garnered the largest revenue share in Asia Pacific market followed by BFSI and Retail & E-commerce among all other end use verticals.

IT & Telecommunication

Trend: The Asia-Pacific region is experiencing rapid growth in AI server adoption within the IT and telecommunication sector, driven by the expansion of 5G networks and the increasing demand for edge computing solutions. Telecom companies are leveraging AI to enhance network operations, customer service, and business intelligence.

To illustrate:

• Thailand's AIS has integrated AI across over half of its network sites, resulting in a 4.4% reduction in energy consumption and a 2% decrease in utility expenses. Their AI-powered customer service solutions handle over a quarter of all customer interactions, achieving a 94% customer satisfaction rate.

BFSI (Banking, Financial Services, and Insurance)

Trend:The BFSI sector in Asia-Pacific is increasingly adopting AI servers to enhance operational efficiency, customer experience, and risk management. Financial institutions are integrating AI to automate processes and provide personalized services.

To illustrate:

• India's BFSI sector is undergoing a transformative shift with the integration of Agentic AI, enabling systems to autonomously interpret scenarios, adapt to new data, and initiate real-time actions with minimal human involvement. This advanced AI is revolutionizing customer engagement, risk management, and operational efficiency within financial institutions.

Based on Processor Type, the market is segmented into GPU-based Servers, FPGA-based Servers, and ASIC-based Servers. Based on Cooling Technology, the market is segmented into Air Cooling, Liquid Cooling, and Hybrid Cooling. Based on Form Factor, the market is segmented into Rack-mounted Servers, Blade Servers, and Tower Servers. Based on End Use, the market is segmented into IT & Telecommunication, BFSI, Retail & E-commerce, Healthcare & Pharmaceutical, Automotive, and Other End Use. Based on countries, the market is segmented into China, Japan, India, South Korea, Singapore, Malaysia, and Rest of Asia Pacific.

Asia Pacific AI Server Market Report Segmentation

By Processor Type

• GPU-based Servers
• FPGA-based Servers
• ASIC-based Servers

By Cooling Technology

• Air Cooling
• Liquid Cooling
• Hybrid Cooling

By Form Factor

• Rack-mounted Servers
• Blade Servers
• Tower Servers

By End Use

• IT & Telecommunication
• BFSI
• Retail & E-commerce
• Healthcare & Pharmaceutical
• Automotive
• Other End Use

By Country

• China
• Japan
• India
• South Korea
• Singapore
• Malaysia
• Rest of Asia Pacific