Spending for the Hyperscale Cloud Service Providers to Surge 30 Percent in 2022, According to Dell’Oro Group

According to a recently published report from Dell’Oro Group, the trusted source for market information about the telecommunications, networks, and data center IT industries, data center spending for the hyperscale cloud service providers is forecast to surge by 30 percent in 2022. We also anticipate the supply chain constraints to start easing next year, resulting in tailwind growth for both the Cloud and the Enterprise markets.

“We predict the major Cloud service providers to enter an expansion cycle in 2022,” said Baron Fung, Research Director at Dell’Oro Group. “The Top 10 Cloud service providers are planning to launch new data centers in more than 30 regions next year and will increase their investments on new server architectures and network upgrades. The Cloud service providers will also increase spending on AI infrastructure, enabling enterprises to deploy applications with enhanced intelligence and automation, and lay the foundation for the metaverse,” explained Fung.

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Additional highlights from the 3Q 2021 Data Center Capex Quarterly Report:

• Worldwide data center capex forecast to grow 17 percent in 2022.
• Server unit shipments are forecast to return to double-digit growth next year, as supply constraints ease.
• Data center capex for each of the Top 4 Cloud service providers—Amazon, Google, Meta, and Microsoft—projected to surpass $20 billion in 2022.

Dell’Oro Group’s Data Center Capex Quarterly Report details the data center infrastructure capital expenditures of each of the ten largest Cloud service providers, as well as the Rest-of-Cloud, Telco, and Enterprise customer segments. Allocation of the data center infrastructure capex for servers, storage systems, and other auxiliary data center equipment is provided. The report also discusses market trends, drivers of the leading Cloud service providers’ capex growth during the quarter, and the outlook for the next year.

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