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“The hyperscale cloud service providers have undergone a robust expansion cycle for three straight years while navigating through a supply constraint environment,” said Baron Fung, Senior Research Director at Dell’Oro Group. “Enterprises also increased their IT spending from digital transformation initiatives. However, the market is due for a pullback as the hyperscalers are at the end of their expansion cycle and seek to improve efficiencies, and the enterprises will scrutinize expenditures more carefully in an uncertain economic environment. Thus, shifting from a supply-constrained environment to one that is oversupplied as demand softens in certain sectors,” explained Fung.
Additional highlights from the 4Q 2022 Data Center IT Capex Quarterly Report:
•The Top 10 Cloud SPs comprised 48 percent of global data center capex in 2022.
•The leading server vendors by revenue in 2022 were Dell, followed by HPE and Inspur.
•Upcoming server architectural changes and accelerated computing will contribute to long-term data center investments.