Data Centers Drive IT Market Surge: Revenue to Jump by 15% and hit $367 Billion in 2025

November 24, 9:44 am

The surging demand for cloud computing, increased data volumes, and the widespread use of AI technologies have helped the data centers 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.

15% Surge Makes 2025 One of the Top 5 Years for Data Centers in a Decade

The data center market has seen explosive growth in the past ten 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 (NVDA), a global supplier of parts for modern cloud storage and processing data centers, is the world`s largest tech company, outpacing even the tech giants Apple (AAPL) and Microsoft (MSFT). At the same time, Amazon Web Services generate roughly 20% of the ecommerce giant`s revenue, showcasing the huge role data centers have 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 centers 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 centers jumping by another 15% and reaching over $367 billion. Moreover, this places 2025 among the top five years for data centers 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 center 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.

Data Centers Spending More than Doubled in a Decade

Although it has become quite common for companies to spend hundreds of billions of dollars on data centers each year and to regularly increase their budgets for services in this segment of the IT industry, the ten-year difference in total spending is still shocking. 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 United States and China, the world`s largest data center spenders. According to 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% and reaching a $93 billion value by 2028. Other top markets, Japan, Germany, and the United Kingdom, will see similar growth rates, with their revenues growing by 32%, 27%, and 31%, respectively.

Get More Insights

Sign up and get access to a personalized dashboard, deeper insights, AI stock picks, stock alerts, weekly newsletter and much more.