Hyperscale Blackwell and Custom Accelerator Rollouts Drive 53 Percent Data Center Capex Growth in 1Q 2025, According to Dell'Oro Group

Sixth Straight Quarter of Double-Digit Growth Despite Tariff Uncertainties

REDWOOD CITY, Calif., June 17, 2025 /PRNewswire/ -- According to a recently published report by Dell'Oro Group, the trusted source for market information about the telecommunications, security, networks, and data center industries, worldwide data center capex surged 53 percent year-over-year in 1Q 2025, marking the sixth consecutive quarter of double-digit annual growth. This growth streak continues to be propelled by hyperscale cloud service providers ramping investments in AI infrastructure, particularly from deployments of servers powered by NVIDIA's Blackwell GPU and custom accelerators.

"AI infrastructure continues to drive hyperscale capex, with strong demand for NVIDIA Blackwell-based servers and custom accelerators," said Baron Fung, Sr. Research Director at Dell'Oro Group. "The Top 4 US cloud service providers continue to raise capex levels as part of a multi-year investment cycle. Tariff-related uncertainties are not expected to materially alter hyperscaler spending plans given their diversified global supply chains. Despite some project cancellations by US cloud providers, overall capex remains on track, with hyperscalers adjusting capacity rather than cutting investments. Enterprises, facing tighter budgets and tariff-related risks, are more cautious, prompting slight downward revisions to their capex forecasts. Meanwhile, the Tier 2 cloud segment—led by emerging GPUaaS providers—is expected to see the fastest growth in 2025 and beyond," explained Fung.

Additional highlights from the 1Q 2025 Data Center IT Capex Quarterly Report:

• Global data center is projected to rise by 30 percent in 2025, with sustained demand on AI infrastructure and a broader recovery in general-purpose infrastructure for servers and networking.
• High-end accelerated servers projected to account for over one-third of the total data center capex in 2025.
• Dell led OEM server revenue share in 1Q 2025, followed by HPE, and IEIT Systems. Most of the OEMs benefited from strong demand in AI servers, although shipments of the NVIDIA NVL72 platform remain limited outside of the hyperscale market. White-box vendors accounted for more than 60 percent of the server market on the strength of hyperscale AI server deployments, particularly on the NVL72 platform.

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 general-purpose and accelerated 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 dgsales@delloro.com.

About Dell'Oro Group
Dell'Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, security, enterprise networks infrastructure, and data center 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.

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SOURCE Dell'Oro Group