Description
The hyperscale cloud sector continues to gain momentum as market conditions shift amid an improving macroeconomic environment, evolving enterprise buying behaviour and surging demand. The recent quarter picked up on trends that have been building over the latter half of the previous year moving into the current year. Top-line revenue growth rates have re-accelerated, demand is healthy and AI is positioning to take things to another level.
What is happening in the market has multi-faceted spin-off effects. Rising demand and a new breed of workloads is causing CapEx levels to spike and a good percentage of this translates into data centre colocation consumption. Absorption of existing built-out capacity is also moving faster and this too is speeding up the need for infrastructure. The spin-off effects naturally extend to the end user side. AI workloads are driving adoption of adjacent services, while AI-oriented tools and services are being attached to traditional cloud infrastructure workloads. Both dynamics are in play and enhancing the end user experience, while promoting stickiness and driving margin for cloud platforms. The spin-off effect of adjacent services also pushes into the service provider ecosystem as MSPs and managed public cloud providers help end users sort through the complexity to deploy and operate more efficiently.
The road ahead is not necessarily going to all be smooth sailing. There are pressing challenges that will impact the sector’s growth trajectory. Foremost among them is the extent to which inventory is going to be available. Hyperscalers are already having trouble building enough infrastructure to keep pace with adoption, while land and power constraints are quickly becoming real and limiting where and how fast data centres can be built.
This report provides comprehensive growth rate projections and total revenue estimates for the world’s seven hyperscale cloud platforms on a five-year basis. Included are geographic splits and a total market summation. This latest version also features a refresh of our hyperscale cloud region and interconnection node tracking.Hyperscale cloud is projected to reach $705.7b in value in 2029, with a five-year CAGR of 25.6%. The five-year CAGR has fallen in this range over the near-term, but is set to start climbing as market conditions change
