HPC and hyperscale analyst firm Intersect360 Research has released a new report guiding its clients that the market for High Performance Computing (HPC) products and services will fall significantly short of its previous 2020 forecast, due to the global COVID-19 pandemic. The newly-revised forecast predicts the overall worldwide HPC market will be flat to down 12% in 2020.
The report, Worldwide High Performance Computing Market Forecast: Pre-Announce Guidance Related to the Effects of COVID-19, states that Intersect360 Research now expects worldwide HPC market performance to fall short of previously forecast expectations for the current calendar year by 11% to 12%. The report gives a range of guidance based on uncertain factors; the expected decline is the midpoint of a spread from 6% to 17% below prior market expectations.
Intersect360 Research had previously forecast the HPC market would grow 7.0% in 2020, year-over-year from 2019. This projected shortfall essentially wipes out that growth and projects the market will be flat to down 12% instead, with a midpoint expectation of a 6% loss. This would end a streak of ten straight growth years for the HPC market.
We are still early in the process of learning about the COVID-19 pandemic and what it will truly mean for the world,” said Addison Snell, CEO of Intersect360 Research. “That said, we cannot think everything will stay the same. Our data and experience show there will be an adjustment in the HPC market as a direct result of the spread of the novel coronavirus.”
The report from Intersect360 Research gives a segment-by-segment analysis of the HPC market, broken out by vertical markets, regions, and products and services. According to the report: “This shortfall will not be evenly spread across market segments. There will be certain segments that may perform at or even above our previous forecast. Conversely, some segments will be significantly below the average decline.”
Some segments of HPC, such as public sector research and pharmaceuticals, are directly engaged in the worldwide fight against COVID-19, and important, incremental investments are buoying these segments,” said Snell. “Other HPC vertical markets, like automotive and aerospace engineering, oil exploration, and entertainment, are already in significant decline.”
Similarly, the report foresees significant differences between product and services categories, as well as minor differences between regions. The three segmentations correspond to a consistent market decline.
According to the report: “As HPC budgets tighten, most organizations prioritize staffing and other existing operational expenditures over new acquisitions and upgrades. In many cases, even when budgets are not cut, the uncertainty causes delays in procurement, which can push spending from one year into the next. At the other extreme, we expect spending on cloud computing for HPC to significantly increase above and beyond the already-high growth rate we had projected.”
The newly-released report draws on end-user data gathered in February and March 2020 as part of an annual HPC budget survey, including specific queries on budget changes related to COVID-19. As part of this report, Intersect360 Research affirms it expects 2019 market performance to remain consistent with its previous forecast.
Intersect360 Research states it plans to release final 2019 HPC market numbers to clients, along with a revised five-year forecast, shortly. “There are times it can be difficult to focus on one’s own small role in a crisis,” said Snell. “In this case, our job is to continue to monitor the health of the HPC industry, while our emotions are focused on the health of our colleagues who comprise it.”
Worldwide High Performance Computing Market Forecast: Pre-Announce Guidance Related to the Effects of COVID-19, as well as the full calendar of Intersect360 Research reports, is available for purchase and download at www.intersect360.com.
