AI Infrastructure Spending Sustains Strong Growth Momentum
REDWOOD CITY, Calif., Feb. 5, 2025 /PRNewswire/ — According to a recently published report from Dell’Oro Group, the trusted source for market information about the telecommunications, networks, and data center industries, worldwide data center capex is projected to surpass $1 trillion by 2029. AI infrastructure spending will maintain its strong growth momentum despite ongoing sustainability efforts.
“We project that data center infrastructure spending could surpass $1 trillion annually within five years. While AI spending has yet to meet desired returns and efficiency improvements, long-term growth remains assured, driven by hyperscalers’ multi-year capex cycles and government initiatives such as the $500 billion Stargate Project,” said Baron Fung, Senior Research Director at Dell’Oro Group. “Although recent advancements in AI model training efficiency from DeepSeek have been disruptive, innovations have been in progress for some time to drive greater efficiencies and lower the total cost of ownership in building and operating AI data centers. Key areas of focus include advancements in accelerated computing through GPUs and custom accelerators, LLM optimizations, and next-generation rack-scale and network infrastructure—all crucial to enabling sustainable growth from both a cost and power perspective,” Fung explained.
Additional highlights from the Data Center IT Capex 5-Year January 2025 Forecast Report:
- Worldwide data center capex is forecast for a CAGR of 21 percent by 2029.
- Accelerated servers for AI training and domain-specific workloads could represent nearly half of data center infrastructure spending by 2029.
- While the Top 4 US-based cloud service providers (SPs)—Amazon, Google, Meta, and Microsoft—will account for nearly half of global data center capex in 2025, select Tier 2 cloud SPs are poised to increase capex significantly over the next several years.
About the Report
The Dell’Oro Group’s Data Center IT Capex 5-Year Forecast Report offers a complete overview of the market with historical data from 2014 to the present. The forecasts provide a comprehensive overview of market and technology trends and include tables covering data center and server capex and server unit shipments forecasts for Top 4 US Cloud, Top 4 China Cloud, Top 3 Tier 2 Cloud, Rest-of-Cloud, Telco, and Enterprise customer segments. The report also breakout markets for data center infrastructure equipment, along with server, storage system, and other data center equipment revenues sub-segments. To purchase this report, please contact us at [email protected].
About Dell’Oro Group
Dell’Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, networks, and data center IT markets. Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions. For more information, contact Dell’Oro Group at +1.650.622.9400 or visit www.delloro.com.
SOURCE Dell’Oro Group
