Unlike digital processors such as GPUs that perform computing tasks, analog and power semiconductors manage how electricity flows through data center systems.
These components are essential at multiple stages of the power chain, including converting grid electricity into usable power for servers and stabilizing voltage for GPUs and other computing hardware.
The importance of these chips is rising as AI workloads dramatically increase electricity consumption inside data centers. New AI server racks require far more power than traditional computing infrastructure, pushing operators to adopt more advanced power management architectures.
The bank said power semiconductors, which convert and control electricity across servers and infrastructure, are becoming increasingly important as AI data centers consume significantly more power than traditional facilities.
UBS expects the market for AI data center power semiconductors to expand sharply over the next few years, estimating total addressable market growth from about $1.5 billion in 2025 to roughly $2.5 billion in 2026. The market could reach around $3.8 billion by 2028 as AI infrastructure continues to scale.
A key driver of this growth is the rising power density of AI server racks. As more GPUs are packed into data center systems, the electricity required per rack is expected to surge from roughly 40 kilowatts in 2023 to as much as 1 megawatt by 2028, significantly increasing the amount of power management hardware required.
source https://www.investing.com/news/economy-news/ubs-sees-rising-opportunity-for-analog-semis-in-ai-data-center-power-4548598
