Cloud Expansion to Lift Data Center Capex Double-Digits in 2022, According to Dell'Oro Group

Amazon, Google, Meta, and Microsoft--projected to increase 28 percent in 2022

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Mar 09, 2022, 08:00 ET

REDWOOD CITY, Calif., March 9, 2022 /PRNewswire/ -- 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, most of the major cloud service providers will undergo an expansion cycle this year, which would lift worldwide data center capex by double-digits in 2022. However, we believe persistent supply chain constraints could limit growth.

"In 2021, worldwide data center capex grew nine percent and surpassed $200 billion for the first time," said Baron Fung, Research Director at Dell'Oro Group. "However, growth mainly came from higher server average selling prices as vendors pass on higher commodity and supply chain costs to end-users, while units grew low single-digits due to supply constraints. New server platforms, equipped with next-generation processors and AI-accelerators also contributed to higher revenue growth. The market is primed for further acceleration this year as vendors navigate through the ongoing sourcing challenges. New data center footprint, network upgrade cycle, and the continued adoption of accelerated computing are expected to drive higher spending among the major cloud service providers and enterprise customers," explained Fung.

Additional highlights from the 4Q 2021 Data Center IT Capex Quarterly Report:

Worldwide data center capex forecast to exceed $240 billion in 2022.
Server unit shipments are forecast to return to double-digit growth this year, as supply constraints ease.
Hyperscale cloud service providers scheduled to launch services in more than 40 new regions in 2022.

About the Report
Dell'Oro Group's Data Center IT 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. 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, enterprise networks infrastructure, network security, 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