San Francisco – October 31, 2026 -- Merchant-built server-class Ethernet NIC revenue rose 40% year-over-year in calendar Q2 2024, reaching an annualized run-rate close to $5 billion, according to Crehan Research. The figures cover adapters, controllers and LOMs.
SmartNICs grow over 50% while mainstream NICs gain over 30%
Foundational/Performance Ethernet NIC revenue increased more than 30% year-over-year. DPU/IPU Ethernet SmartNIC revenue grew more than 50%. Crehan attributes the growth largely to numerous concurrent Ethernet speed and technology upgrades.
Crehan Research President Seamus Crehan said the market now supports almost three times as many Ethernet speeds as a decade ago, when there were three.
Intel holds top SmartNIC share as its IPU revenue climbs 50% sequentially
Intel increased its majority shipment share in the Foundational/Performance segment. Its IPU business grew roughly 50% sequentially, and the company kept the top shipment and revenue share in the merchant-built DPU/IPU/SmartNIC category.
Broadcom and Nvidia ride AI-driven demand
Broadcom posted a strong increase in Foundational/Performance NICs. Crehan expects its Thor 2 AI-optimized NICs to drive strong growth starting in the second half of 2024. Nvidia recorded very robust DPU/IPU/SmartNIC growth, supported by BlueField AI deployments.
AI networking could redraw vendor share
Crehan said AI server networking could drive "significant Ethernet NIC market share shifts" as upgrade cycles speed up, technology shifts arrive suddenly and new customers emerge.