The surging demand for cloud computing, increased data volumes, and the widespread use of AI technologies have helped the data centre market not only to recover from the 2023 slowdown but to hit record highs.
According to data presented by AltIndex.com, global spending on data centers is forecasted to grow by 15% and hit $367-billion in 2025, the biggest increase among all IT industry segments.
The data centre market has seen explosive growth in the past 10 years. From a once-niche piece of IT infrastructure, it has evolved into a massive revenue driver for tech giants and the talk of the investment world.
Today, Nvidia is the world`s largest tech company. At the same time, Amazon Web Services generates roughly 20% of the ecommerce giant`s revenue, showcasing the huge role data centres play in its business. The surging use of AI technologies has only fueled the market growth, helping it to hit record highs.
According to Gartner, global spending on data centres has skyrocketed by 34% and hit over $318-billion this year. This shows a strong recovery after the 2023 slowdown, which saw 3% year-over-year growth and $236-billion in total spending.
Gartner expects the double-digit growth to continue in 2025, with global spending on data centres jumping by another 15% and reaching over $367-billion. This will place 2025 among the top five years for data centres in a decade. Besides a 34% surge in 2024, the market saw just as impressive growth of 20% and 16% in 2022 and 2018, respectively.
The data centre boom is even more impressive compared to other IT industry segments, most of which will grow much slower. For instance, global spending on software will increase by 14% and hit over $1,2-trillion next year. The IT services segment is forecasted to see 9% growth and $1,7-trillion in revenue, while IT devices and communication services follow with a 9,5% and 4% annual increase, respectively.
The Gartner data shows global spending on data centers has more than doubled since 2015, when it amounted to roughly $171-billion. Most of that growth came from only two markets, the US and China, the world`s largest data centre spenders.
According to the Statista Market Insights survey, the US market generated around $100-billion, or roughly 30% of total market revenue in 2024. This figure is expected to grow by 25% and hit $125-billion by 2028.
The Chinese market will see even bigger growth, surging by 33% to reach $93-billion value by 2028. Other top markets, Japan, Germany, and the UK, will see similar growth rates, with their revenues growing by 32%, 27%, and 31%, respectively.