A new report from Dell’Oro Group, a source for telco and data centre industries, forecasts a 17% growth in hyperscale cloud capital expenditures (capex) for 2024, driven by accelerated computing and AI infrastructure investments. The enterprise sector is also experiencing a surge in AI infrastructure momentum.

“After a modest 4% growth in 2023, we’re projecting a significant rebound in worldwide data centre capex this year,” said Baron Fung, Sr. Research Director at Dell’Oro Group. “Accelerated computing for generative AI applications is expected to lead data centre investments, with a modest recovery in general-purpose servers and storage demand following a steep correction.”

The report also predicts an 18% growth in server and storage systems revenue in 2024, with a shift in product mix towards AI-optimized servers and server platforms featuring the latest CPUs from Intel, AMD, and ARM.

Additionally, the report forecasts an 8% growth in worldwide server unit shipments by 2028, with over twenty percent of global server deployments expected to be accelerated. Notably, by 2028, the top 4 US-based Cloud Service Providers—Amazon, Google, Meta, and Microsoft—are anticipated to account for half of the global data centre capex, underscoring the significant role of major tech companies in driving data centre investment trends.

These insights underscore the growing importance of AI workloads in shaping the future of data centre infrastructure and the tech industry at large.