Global Data Center Market Size & Share, Growth Insights – Area to Reach 109.61 Million Sq. Ft. and Power Capacity to Exceed 28,307 MW Globally by 2031

Global Data Center Market Landscape 2026-2031

DATA CENTER MARKET SIZE & SHARE

The global data center market size was valued at USD 514.26 billion in 2025 and is expected to reach USD 959.19 billion by 2031, growing at a CAGR of 10.95% during the forecast period.

The data center market experienced investments of over $514.26 billion in 2025, which grew by around 35.22% in comparison to 2024. This is primarily driven by an increase in deployment of AI workloads across data centers worldwide, triggered by billions of dollars in yearly investments from hyperscale operators such as Amazon Web Services (AWS), Apple, Google, Meta (Facebook), and Microsoft.

Large-scale AI infrastructure initiatives are increasingly driving global data center expansion. Large-scale AI infrastructure initiatives are increasingly driving global data center expansion. A notable example is the Stargate Project, unveiled in January 2025 at the White House by OpenAI, SoftBank Group, Oracle, and MGX. The initiative aims to develop next-generation AI-ready data center infrastructure across the US, with plans to invest up to $500 billion over four years. An initial $100 billion has been committed for immediate deployment toward data centers and supporting infrastructure.

The data center market in Latin America is projected to attract a cumulative investment of $31.00 billion, excluding IT infrastructure, between 2026 and 2031. This growth is primarily driven by Brazil, Chile, Mexico, and other countries emerging as promising investment destinations.

Geopolitical conflicts and regional instability may lead to delays in data center construction due to supply chain disruptions, material shortages, and labor constraints. At the same time, the need for resilient and localized digital infrastructure is expected to drive higher investments in data centers across relatively stable markets in the region.

The UK and Germany are among the biggest data center markets in Europe, accounting for around 19.59% and 13.74% of the European data center market’s investments, respectively, in 2025; these countries continue to witness data center investments from local as well as global data center operators. By 2031, the UK and Germany are expected to contribute around 21.59% and 14.72% of the European data center market's investment share.

In 2025, the APAC data center market by investments increased by around 31.99%, compared to 2024. The rapid adoption of AI in China is becoming one of the key factors driving data center investments, as AI applications require massive, advanced data center facilities to process and store AI workloads. As of June 2025, approximately 515 million Chinese individuals have adopted AI for their daily operations; this count is expected to further increase in the upcoming years. China aims to increase the share of AI adoption to approximately 70% of the Chinese population by 2027, and to over 90% by 2030.

DATA CENTER MARKET SIZE BY AREA

1. The global data center market by area is expected to reach 109.61 million sq ft by 2031, due to the increasing demand for larger and more specialized facilities. Hyperscale cloud providers and colocation operators are expanding their campuses to meet the rising need for computing power, storage capacity, and artificial intelligence (AI) workloads.
2. Modern hyperscale data centers typically range from 200,000 to 1,000,000 square feet (18,500 to 93,000 square meters) per facility, while multi-building campuses can cover several million square feet. The rapid deployment of AI and high-performance computing infrastructure necessitates additional white space, power rooms, cooling systems, and equipment yards, which further increases the overall built-up area for each project.
3. The growing demand for edge data centers is also contributing to construction activity, as smaller facilities are being developed closer to end users to reduce latency. Additionally, increasing rack densities, stricter redundancy requirements, and the need for dedicated renewable energy and cooling infrastructure are expanding the footprint of new developments. As cloud adoption, digital services, and global data generation continue to rise, developers are acquiring larger land parcels and constructing larger data center campuses. This trend is leading to substantial growth in the total construction area of data centers worldwide.
4. In November 2025, two major land acquisitions in Northern Virginia highlighted strong demand for data center development. Amazon purchased a site in Prince William County’s Bristow area for $700 million, while an affiliate of SDC Capital Partners acquired land in Leesburg, Loudoun County, for $615 million, underscoring continued large-scale investment in future data center campuses.

DATA CENTER MARKET BY POWER CAPACITY

1. The global data center market by power capacity is expected to reach 28,307 MW by 2031, owing to the increasing electricity demands of cloud computing, artificial intelligence (AI), machine learning, and high-performance computing applications. Traditionally, enterprise data centers operate at capacities between 1 and 10 megawatts (MW). In contrast, modern hyperscale facilities typically range from 20 to 100 MW. However, the rapid expansion of AI workloads has led to the development of next-generation data center campuses that require between 100 and 500 MW or more. Some planned hyperscale and AI-focused campuses are even targeting power capacities of up to 1 gigawatt (GW).
2. The higher rack densities, often exceeding 30 to 100 kilowatts (kW) per rack for AI applications, significantly increase the power and cooling requirements compared to traditional data center deployments. As a result, data center operators are heavily investing in substations, transmission infrastructure, backup power systems, and renewable energy integration. The availability of reliable and scalable power has become one of the most critical criteria for site selection for new data center projects.
3. Major players, such as Amazon, Google, Meta, and Microsoft, are at the forefront of this initiative, securing contracts for a substantial total of 40 gigawatts (GW) of wind and solar power in the US through Power Purchase Agreements (PPAs).

RECENT DEVELOPMENT & NEWS IN THE GLOBAL DATA CENTER MARKET

1. In July 2026, Google announced plans to expand its under-construction data center campus in LaGrange, Georgia. The company plans to add a second building with an investment of around $1 billion, with construction likely to continue until 2029.
2. In July 2026, Equinix announced topping out of the third phase of its MU4 data center facility in Munich, Germany. Mercury Engineering completed the construction.
3. In November 2025, Teraco (Digital Realty) completed the expansion of its CT2 data center facility in Cape Town, South Africa. The facility now offers 50 MW IT power.
4. In May 2026, NEXTDC announced the operation of its KL1 data center facility in Kuala Lumpur, Malaysia. The data center will be built across five phases, with the first phase offering 15 MW power capacity.
5. In April 2026, Pure Data Centres announced its plan to expand the Abu Dhabi data center campus by adding 7 MW power capacity. The AUH01 data center campus will offer 48 MW on completion.

DATA CENTER MARKET TRENDS

AI, Sustainability, and Advanced Cooling Reshape Data Center Development

1. AI adoption is accelerating data center demand, driving rapid expansion of hyperscale, cloud, and AI-ready facilities across major markets. Growing deployment of GPU-intensive workloads is pushing operators toward higher rack densities, AI-optimized designs, and greater power capacity. Large-scale initiatives across the U.S., Europe, Latin America, APAC, and Africa are further strengthening demand for AI infrastructure.
2. Sustainability is becoming a core requirement for data center development as operators respond to rising energy consumption, climate targets, and ESG requirements. Renewable PPAs, low-carbon power, heat recovery, district heating, carbon removal, and energy-efficient infrastructure are increasingly being integrated into data center operations, particularly across Europe, the Nordics, North America, and emerging markets.
3. Liquid cooling is gaining momentum as AI and HPC workloads increase rack power densities. Direct-to-chip and immersion cooling are being adopted to manage higher thermal loads while improving energy efficiency and scalability. AI-ready facilities increasingly combine advanced liquid cooling with high-density power infrastructure and renewable energy to support next-generation workloads.
4. Governments and enterprises are simultaneously expanding digitalization, cloud, AI, and renewable energy infrastructure, creating a broader shift toward data centers that are more powerful, energy-efficient, and environmentally sustainable.

GLOBAL DATA CENTER MARKET OPPORTUNITIES

1. The rapid expansion of AI creates significant opportunities for hyperscale and colocation operators, GPU/cloud providers, power suppliers, and data center developers to build high-density, AI-ready capacity. Large-scale investments such as the U.S. Stargate initiative, Alibaba’s planned AI infrastructure investment in China, and YTL–NVIDIA’s AI infrastructure investment in Malaysia highlight the scale of the opportunity.
2. Emerging markets across Latin America, Africa, APAC, and the Middle East offer strong growth potential as governments accelerate AI, cloud, connectivity, and renewable energy programs. Countries such as Brazil, Mexico, Argentina, South Africa, Malaysia, Australia, and the UAE are increasingly positioning themselves for AI and hyperscale infrastructure investment.
3. The transition toward liquid cooling, advanced power systems, and AI-optimized data centers creates opportunities across the data center technology ecosystem. Direct-to-chip and immersion cooling can support racks exceeding 50 kW and are increasingly relevant for GPU- and HPC-intensive deployments.
4. Renewable energy and sustainable infrastructure represent another major opportunity, particularly through PPAs, dedicated renewable projects, waste-heat recovery, low-carbon backup power, and 24/7 clean-energy solutions. The convergence of AI growth and sustainability is expected to accelerate investment in data centers that can deliver high computing capacity while managing power, cooling, water, and carbon requirements efficiently.

DATA CENTER MARKET DRIVERS

Enhanced Connectivity Through Submarine Cables

1. Submarine cables are vital as they enable high-speed, low-latency international connectivity, supporting the growing digital economy of the region. They are essential for cloud services, data centers, and cross-border internet traffic.
2. South America-1 (SAm-1) is the longest subsea cable system serving Latin America, providing high-capacity fiber connectivity that links the country to the US, Puerto Rico, Brazil, Chile, Peru, Guatemala, Argentina, and Ecuador. The system offers ring-based route redundancy and multiple landing points across South America, ensuring resilient international traffic flow and enhanced network reliability.
3. Several upcoming submarine cable projects, including Norte Conectado (Infovia 02), Norte Conectado (Infovia 04), and Firminia, are expected to significantly improve connectivity in areas that have traditionally lacked robust digital infrastructure. These initiatives are particularly important for extending high-speed connectivity beyond the major metropolitan regions in Brazil.
4. Europe has been increasing its digital infrastructure by expanding submarine cable connectivity, which plays a pivotal role in driving the region’s cross-border connectivity and data transmission speeds to support the rising demands for cloud computing services, digitalization, and AI.

Heightened Demand for Cloud Services

1. The adoption of cloud computing services and applications continues to rise rapidly, leading to the establishment of vast hyperscale cloud-based data centers. Cloud computing changes the dynamics of data center facilities, leading to several innovations and the inculcation of modern infrastructure.
2. Colocation service providers are also witnessing high demand for cloud connectivity solutions. Moreover, cloud connectivity solutions are expected to grow in countries that are likely to be aided by the growth in internet backbone and colocation facilities during the forecast period.
3. Microsoft, Google, Oracle, and AWS are among the top cloud providers in the market. Other companies, such as Alibaba Cloud, Tencent Cloud, OVHcloud, and IBM Cloud, also operate in the market and have significant market share.
4. Google has announced a $40 billion investment in Texas through 2027 to expand its cloud and AI infrastructure footprint. The initiative includes the development of new data center campuses in Armstrong and Haskell counties, with one Haskell County facility being co-located with a solar and battery energy storage project, reinforcing a focus on sustainable operations.

DATA CENTER MARKET SEGMENTATION INSIGHTS

By Data Center Electrical Infrastructure

1. The electrical infrastructure market is one of the largest components of data center capital expenditure (CapEx), typically accounting for 35-50% of total facility investment. As AI, cloud computing, hyperscale facilities, and edge deployments expand globally, demand for electrical equipment is growing faster than overall data center construction.
2. Additionally, several innovative UPS batteries such as Nickel-Zinc (NiZn) and Sodium-Ion batteries are gaining traction in the market due to their high-power density, safety, sustainability, and other factors. VRLA remains the largest installed battery base in enterprise and colocation data centers due to decades of deployment and lower capital costs. Many hyperscale operators now prefer lithium-ion batteries for new facilities because they reduce space requirements and replacement costs.
3. The uninterruptible power supply (UPS) market is transitioning from a basic backup power model to a sophisticated smart energy infrastructure. Key trends driving this shift include the adoption of lithium-ion batteries, modular designs, AI-driven monitoring, ultra-high-efficiency systems, and integration with energy storage solutions. As AI technologies and hyperscale data centers expand from tens to hundreds of megawatts, UPS suppliers that can provide high-density, scalable, and intelligent power systems will be best positioned for future growth.
4. The need for generators in data centers is still high, despite generators being the major contributors to carbon emissions. Africa Data Centres’ Lagos facility maintains 48 hours of diesel backup at full load, supported through agreements with trusted fuel vendors to ensure uninterrupted availability.
5. Hydrotreated Vegetable Oil (HVO) is projected to become the preferred low-carbon backup fuel in the next decade; however, it will primarily serve as a backup power solution rather than a primary power source. Companies like Vantage Data Centers, Compass Data Centers, and Digital Realty, along with other colocation providers, are working on developing larger supply chains for HVO.

By Data Center Mechanical Infrastructure:

1. Mechanical infrastructure represents the second-largest capital expenditure (CapEx) category for data centers, following electrical infrastructure. It typically accounts for 25-40% of the total facility investment. The primary function of mechanical infrastructure is to dissipate the heat generated by IT equipment while ensuring optimal operating conditions, reliability, and energy efficiency. As artificial intelligence and high-density computing workloads continue to grow, the mechanical infrastructure market is undergoing a significant transformation. This shift is driven by the adoption of liquid cooling solutions, sustainability requirements, and increasing rack power densities.
2. Cooling has become one of the most critical areas of innovation in the data center industry. Historically, cooling accounted for 30-40% of a data center's total energy consumption. However, the rise of AI workloads, GPU clusters, and high-performance computing (HPC) has fundamentally changed cooling requirements. Rack densities that once averaged 5-10 kW are increasingly reaching 30-100 kW+, with some AI deployments exceeding 150 kW per rack.
3. Liquid cooling is no longer an experimental technology. It is becoming the standard thermal-management solution for AI and HPC workloads. Direct-to-chip cooling is currently the dominant adoption path because it balances performance, scalability, and compatibility with existing data center designs. Over the next five years, most new hyperscale and AI facilities are expected to incorporate liquid-cooling infrastructure, while immersion cooling is likely to gain share in the highest-density deployments.
4. The data center rack is transitioning from a simple metal enclosure to an advanced infrastructure platform that is intelligent, high-density, and capable of liquid cooling. While traditional enterprise environments typically utilize air-cooled racks that handle 5-10 kW, AI facilities are increasingly adopting liquid-cooled racks that can manage between 50 and 150+ kW. This shift is driving innovation in areas such as power delivery, thermal management, monitoring, and rack-scale computing. Over the next five years, the most significant growth areas will be AI-ready racks, integrated liquid-cooling cabinets, smart power distribution units (PDUs), Open Compute Project (OCP) architectures, and autonomous rack management systems.

Other Segment Insights:

1. In Europe, Sweden led the data center market in terms of hyperscale data center investments, accounting for around 38.38% of the market’s hyperscale data center investments, followed by the UK, Spain, the Netherlands, and others. In addition, the UK is expected to lead the European data center market in 2031, in terms of hyperscale data center investments, contributing to generating around 21.31% of the market's hyperscale data center investments during the same period, followed by Germany, Norway, France, and others.
2. Additionally, several innovative UPS batteries, such as Nickel-Zinc (NiZn) and Sodium-Ion batteries, are gaining traction in the market due to their high-power density, safety, sustainability, and other factors. VRLA remains the largest installed battery base in enterprise and colocation data centers due to decades of deployment and lower capital costs. Many hyperscale operators now prefer lithium-ion batteries for new facilities because they reduce space requirements and replacement costs.
3. The data center liquid cooling market primarily features two methods, which include Direct-to-Chip (DTC) cooling and Liquid Immersion Cooling. As per the early trends and data, DTC is the larger and more widely adopted method at present. In contrast, immersion cooling is experiencing rapid growth, albeit from a smaller starting point, primarily due to the demands of AI and high-performance computing (HPC) workloads.
4. The 42U rack unit is the most used in data centers. Rack units of 45U, 47U, and 48U are mainly installed in large data center environments. A single data center can comprise racks of different sizes. The Riyadh data center facility in Saudi Arabia, operated by NourNet, has been installed with approximately 450 rack cabinets.

MARKET RESTRAINTS

Carbon Emissions and Sustainability Pressures: Data centers are highly energy-intensive and contribute significantly to global electricity consumption and greenhouse gas emissions. Growing scrutiny over carbon emissions, water consumption, and environmental impact is increasing pressure on operators to adopt renewable energy, energy-efficient cooling, carbon reduction measures, and transparent sustainability reporting. Meeting increasingly stringent ESG and climate requirements can also raise development and operating costs.

Site Selection and Infrastructure Constraints: The availability of suitable land, reliable water resources, power infrastructure, network connectivity, and supportive local regulations remains a major challenge for data center development. Land scarcity and rising property costs in established markets, water stress in regions such as the Middle East and Africa, environmental and permitting requirements, and community opposition can delay projects, increase CAPEX, and restrict expansion.

Security and Operational Risks: Rising cyberattacks, ransomware, physical security threats, and increasingly stringent data protection regulations are increasing the complexity and cost of operating critical digital infrastructure. Data center operators must continuously invest in cybersecurity, physical protection, monitoring, compliance, and business continuity measures to safeguard increasingly valuable AI, cloud, and enterprise workloads.

Power Availability and Grid Reliability: Limited grid capacity, aging electricity infrastructure, connection delays, and power outages are emerging as critical constraints on data center expansion, particularly as AI workloads significantly increase power requirements. In several markets, grid limitations have delayed or restricted new projects, while operators are increasingly turning to PPAs, on-site generation, energy storage, and backup power systems to secure reliable capacity.

GLOBAL DATA CENTER MARKET GEOGRAPHICAL ANALYSIS

Americas Data Center Market:

1. The data center market in the Americas accounted for more than 61% of the total global data center investment in 2025, solidifying its dominance in the worldwide market. In North America, the US and Canada are the leading destinations for data centers, while Brazil and Mexico are prominent in the Latin American market. Additionally, countries like Chile, Colombia, and Argentina are emerging as significant players in this sector.
2. The Canadian government supports AI technology; in January 2025, the Canadian government announced a $52 million fund for quantum technology projects, which is estimated to support around 107 projects across the country.
3. In August 2025, Colombia launched its own data center association – the Colombian Association of Data Centers and Data Technology (ACOLDC). This non-profit organization aims to strengthen the digital infrastructure of the country by promoting the development of data centers as strategic pillars of the digital economy. The ACOLDC connects leading data centers in the Colombian market with high-quality providers to position the country as a technological hub in the region and to enhance the economic growth of the sector.

Europe Data Center Market:

1. The FLAP-D markets (Frankfurt, London, Amsterdam, Paris and Dublin) are among the top and established data center markets in the Europe region. Markets such as Spain, Italy, Portugal, Belgium, Finland, Poland, and Norway are among the emerging data center markets in the region.
2. The Nordics (Sweden, Norway, Finland, Denmark, and increasingly Iceland) are often called the "land of hyperscalers" because they offer a unique combination of power, climate, connectivity, sustainability, and political stability that is difficult to replicate elsewhere. Hyperscalers such as Microsoft, Google, Meta, and AWS prioritize regions where they can secure long-term renewable power purchase agreements (PPAs) and meet carbon reduction targets.

Middle East & Africa Data Center Market:

1. The UAE continues to rank among the most advanced data center markets in the Middle East, supported by accelerating digitalization, proactive government initiatives, high internet and social media penetration, extensive inland and submarine connectivity, as well as a well-defined regulatory framework.
2. As of November 2025, South Africa hosts around 11 operational submarine cables. In July 2025, NVIDIA announced the signing of a partnership deal with Cassava Technologies to build AI-ready data centers across African countries such as Egypt, Nigeria, Kenya, and Morocco, for a total investment of around $700 million.
3. Egypt is expected to witness the entry of foreign data center companies as the demand for data center services is increasing gradually in the country. The foreign data center companies are collaborating with the local Egyptian companies to develop data centers in the country.

APAC Data Center Market:

1. In 2025, the APAC data center market in terms of investment was valued at $34.65 billion and is expected to reach $83.88 billion by 2031, growing at a CAGR of 15.87%. Singapore is one of the most expensive markets in the world for developing data center facilities. In addition, land availability for data center development is very limited. Operators continue to purchase industrial plots to convert into data centers; however, such activities remain relatively low in the market.
2. Malaysia and Thailand are among the fastest-growing data center markets in the APAC region. In 2025, Malaysia contributed to over 13% of the overall investments in the APAC region and over 3% to the overall data center market globally.

Regional Analysis:

1. In August 2025, Colombia launched its own data center association – the Colombian Association of Data Centers and Data Technology (ACOLDC). This non-profit organization aims to strengthen the digital infrastructure of the country by promoting the development of data centers as strategic pillars of the digital economy. The ACOLDC connects leading data centers in the Colombian market with high-quality providers to position the country as a technological hub in the region and to enhance the economic growth of the sector.
2. In 2025, the APAC data center colocation market by area was valued at 17.36 million sq ft and is expected to reach 23.80 million sq ft by 2031, growing at a CAGR of 5.39%. Singapore is one of the most expensive markets in the world for developing data center facilities. In addition, land availability for data center development is very limited. Operators continue to purchase industrial plots to convert into data centers; however, such activities remain relatively low in the market.

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GLOBAL DATA CENTER MARKET VENDORS - LANDSCAPE

1. The global data center market has the presence of key investors such as AirTrunk, Aligned Data Centers, Amazon Web Services (AWS), Apple, CDC Data Centres, CloudHQ, Compass Datacenters, CyrusOne, DataBank, Digital Realty, EdgeConneX, Equinix, Global Switch, Google, Iron Mountain, Meta, Microsoft, NTT DATA, QTS Realty Trust, STACK Infrastructure, ST Telemedia Global Data Centres (STT GDC), Switch, Vantage Data Centers and others.
2. In February 2026, Google announced a $500 million investment to develop a new international digital exchange hub (“Digital Port”) in the Dominican Republic, marking its first such facility in Latin America outside the US. The project also includes new submarine cable connections to the US, significantly enhancing regional connectivity and positioning the country as a strategic digital gateway across the Americas.
3. In November 2025, Microsoft partnered with Powertrust to support the deployment of 270MW of solar power across Brazil and Mexico, receiving Renewable Energy Certificates from the projects. The initiative aligns with the broader investment of Microsoft in Brazil’s cloud and AI infrastructure and its long-term clean energy procurement strategy.
4. New entrants in the MEA region include Agility Logistics Parks, Anan, Cloudoon, DataVolt, Desert Dragon Data Centers, Ezditek, Humain, Kasi Cloud, Mega DC, MultiDC, NED, NEOIX, Pure Data Centres, Qareeb Data Centres, Techtonic, Volt and others.
5. In February 2025, DataVolt announced its plans for the development of a new AI-ready data center facility in Riyadh, Saudi Arabia; the company has planned to develop a Neom data center, with an IT power capacity of around 1.5 GW, in Neom, Saudi Arabia.
6. In March 2025, Open Access Data Centres announced its plan to invest around $240 million for the development of a new data center facility in Lagos. The data center will support 24 MW on completion and will be built in two stages. The first phase, with 12 MW, is likely to become operational by 2026.

Top 5 Data Center Industry Leaders (Based on Core & Shell IT Power Capacity)

1. Digital Realty
2. Equinix
3. QTS Realty Trust
4. NTT DATA
5. CyrusOne

Top Global Data Center Hyperscale Leaders

1. Meta
2. Amazon Web Services
3. Google
4. Microsoft
5. Apple