Data Center Market Size to Reach $430.18 Bn in 2026 | Projected $1.1 Tn by 2035 Trends and Regional Analysis

According to Precedence Research, the global data center market size is expected to reach nearly USD 1,103.70 billion by 2035, increasing from USD 430.18 billion in 2026, growing at a strong CAGR of 11.06% from 2026 to 2035. The increasing use of wireless technology and growing digitalization across industries drive the market growth.

Ottawa, Jan. 29, 2026 (GLOBE NEWSWIRE) -- The data center market growth is primarily driven by the rising adoption of cloud computing and AI workloads, which demand advanced, high-performance computing and large-scale data storage solutions. Additionally, increasing digitalization across industries, the growth of connected devices, and the expansion of 5G networks are accelerating the need for more data center infrastructure globally.

What is the Data Center Market Size in 2026?

The global data center market size is valued at USD 430.18 billion in 2026 and is expected to be worth USD 1.1 trillion by 2035, with a robust CAGR of 11.06% from 2026 to 2035.

Data Center Market Key Highlights:

North America dominated the global market in 2025, accounting for the largest share of 41%.
Asia Pacific is projected to expand at the fastest CAGR between 2026 and 2035.
By component, the solutions segment held the largest market share of 65.76% in 2025.
By component, the services segment is expected to grow at a remarkable CAGR during the forecast period.
By type, the hyperscale segment is anticipated to register the fastest growth over the projected period.
By enterprise size, the small & medium enterprises (SMEs) segment is expected to expand at the fastest CAGR.
By end-user, the BFSI segment accounted for the largest market share in 2025.
By end-user, the IT & telecom segment is projected to grow at the fastest CAGR over the forecast period.

The Complete Study is Now Available for Immediate Access | Download the Sample Pages of this Report@ https://www.precedenceresearch.com/sample/3531

What is Going on in the Global Data Center Industry?

The data center market growth is driven by the surging use of artificial intelligence, increasing adoption of cloud computing, growth in digital transformation, rise of 5G networks, increasing use of connected devices, growth in internet penetration, and the growing content streaming activities.

A data center is a centralized facility that processes, distributes, collects, and stores data. The key components of data centers are power systems, connectivity, DCIM software, IT equipment, cooling infrastructure, and physical security. The various types of data centers are colocation, enterprise, and cloud data centers. Data center offers benefits like disaster recovery plans, improved performance, centralized data management, high availability, and enhanced security.

Major Government Initiatives for the Data Center Industry:

Draft National Data Centre Policy (India): This 2025–2026 framework proposes a 20-year tax holiday and GST input tax credits on capital assets for developers who meet specific capacity, energy efficiency, and job creation milestones.
CHIPS and Science Act (United States): This policy provides billions in subsidies and a 25% investment tax credit (active through 2026) to re-shore advanced semiconductor manufacturing, which directly fuels the specialized hardware needed for AI-ready data centers.
IndiaAI Mission: This initiative supports the growth of high-performance computing by providing subsidized access to 10,000+ GPUs and fostering a sovereign AI ecosystem through public-private partnerships.
Data Sovereignty and Localization Mandates: Regulations in major economies like India (DPDP Act 2023) and the EU require sensitive personal and financial data to be stored locally, forcing global tech giants to build massive domestic data center footprints.
State-Level Infrastructure Status (India): By granting data centers "infrastructure status" on par with roads and power, regional governments have enabled easier access to low-cost capital, single-window clearances, and subsidized land and power rates.

➡️ Become a valued research partner with us ☎ https://www.precedenceresearch.com/schedule-meeting

Key Trends of the Data Center Market

Dominance of AI-Native Infrastructure and Liquid Cooling: The massive power and heat generated by AI workloads have made advanced liquid cooling (such as direct-to-chip and immersion) an industry standard, replacing traditional air cooling in high-density facilities. This shift allows for significantly higher rack densities and improved energy efficiency, with some liquid-cooled centers reaching Power Usage Effectiveness (PUE) scores below 1.1.
Decentralization Through Edge Computing: To support real-time applications like autonomous vehicles, remote surgery, and smart city services, processing is shifting from centralized hubs to localized edge data centers. These smaller facilities reduce latency by handling data closer to its source and are projected to grow into a global market worth over $300 billion by late 2026.

Built for leaders who move markets. Access live, actionable intelligence with Precedence Q. https://www.precedenceresearch.com/precedenceq/

Market Opportunity

Growing OTT Platforms Create Higher Demand for Data Centers

The growing expansion of streaming services and the increased popularity of content creation increase demand for data centers. The presence of analytics, video files, and user profiles on over the top (OTT) platforms requires data centers. The increased streaming of live events and the development of high-quality video are increasing the adoption of data centers.

The increased viewership of OTT platforms and the focus on creating a seamless viewing experience increase demand for data centers to store data. The increasing need for understanding viewer behavior and the focus on content management require data centers. The growing OTT platforms create an opportunity for the growth of the data center industry.

Get informed with deep-dive intelligence on AI’s market impact https://www.precedenceresearch.com/ai-precedence

Data Center Market Report Coverage

Report Highlights	Details
Market Size in 2025	USD 386.71 Billion
Market Size in 2026	USD 430.18 Billion
Market Size by 2035	USD 1,103.70 Billion
Growth Rate (2026 – 2035)	11.06% CAGR
Largest Market	North America
Base Year	2025
Forecast Period	2026 to 2035
Segments Covered	Component, Type, Enterprise Size, End User, and Region
Regions Covered	North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa

➤ Access the Full Data Center Market Study @ https://www.precedenceresearch.com/data-center-market

Data Center Market Regional Insights

Why North America Dominates the Data Center Market?

North America dominated the market in 2025 with a 41% share. The higher adoption rate of technologies and the strong presence of digital infrastructure increase demand for data centers. The increasing investment in technological infrastructure and the integration of IT in diverse industries increases demand for data centers. The strong presence of Google Cloud, AWS, and Microsoft Azure drives the overall market growth.

What is the U.S. Data Center Market Size in 2026?

The U.S. data center market size is exhibited at USD 149.92 billion in 2026 and is projected to be worth around USD 393.14 billion by 2035, poised to grow at a CAGR of 11.30% from 2026 to 2035.

Try Before You Buy – Get the Sample Report@ https://www.precedenceresearch.com/sample/3531

U.S. Data Center Market Trends

The U.S. market is experiencing rapid growth, driven primarily by hyperscale cloud expansion, artificial intelligence workloads, and rising demand for colocation services. Power availability has become the most critical constraint, pushing operators towards secondary markets, on-site generation, and closer coordination with utilities. AI workloads are increasing rack densities, accelerating adoption of liquid cooling and more energy-efficient designs.

Which Region is Experiencing the Fastest Growth in the Data Center Market?

Asia Pacific is experiencing the fastest growth in the market during the forecast period. The ongoing digital transformation across industries and strong government support for digital infrastructure increase the demand for data centers. The expanding e-commerce sector and the focus on data security increase demand for data centers. The increasing use of Internet of Things (IoT) devices and the expansion of 5G networks require data centers, supporting the overall market growth.

India Data Center Market Trends

India's market is expanding rapidly, driven by strong demand from cloud computing, AI adoption, 5G rollout, and the growth of digital services. Government policies such as data localization requirements and rising digital consumption are encouraging increased domestic data storage and processing. Major hubs including Mumbai, Chennai, Hyderabad, and Delhi-NCR continue to attract hyperscale investments, while Tier-2 cities are emerging as new growth centers.

How Big is the Japan Data Center Market and What’s Driving Its Growth?

The Japan data center market size is projected to grow from USD 11.96 billion in 2026 to USD 24.64 billion by 2035 at a CAGR of 8.36%, fueled by cloud adoption, AI workloads, 5G rollout, IoT expansion, and sustainability initiatives.

Key Highlights:

Leading segments: Large data centers and colocation facilities dominate; IT & ITES and BFSI are major end users.
Fastest-growing areas: Medium-sized data centers and BFSI segment.
Trends: AI-enabled operations, green and energy-efficient infrastructure, and colocation adoption.
Regulatory factors: Data residency and privacy laws (APPI) drive local data center expansion, supported by cybersecurity guidelines.

Japan continues to see rapid investment in scalable, sustainable, and AI-optimized data centers to meet growing enterprise and digital infrastructure demands.

Japan Data Center Market Scope

Report Coverage	Details
Market Size in 2025	USD 11.04 Billion
Market Size in 2026	USD 11.96 Billion
Market Size by 2035	USD 24.64 Billion
Market Growth Rate from 2026 to 2035	CAGR of 8.36%
Base Year	2025
Forecast Period	2026 to 2035
Segments Covered	By Data Center Size, Data Center Type, End User

You can place an order or ask any questions, please feel free to contact at sales@precedenceresearch.com | +1 804 441 9344

Data Center Market Market Segmentation

Component Insights

Why Solution Segment Dominates the Data Center Market?

The solution segment dominated the market with a 65.76% share in 2025. The growing use of high-performance computing and the strong focus on data management increase demand for solutions. The increased real-time data processing and the increasing use of AI-powered monitoring require solutions. The strong focus on protecting sensitive data and growing cloud computing increases demand for solutions, driving the overall market growth.

Type Insights

How did the Colocation Segment hold the Largest Share in the Data Center Market?

The colocation segment held the largest revenue share of the market in 2025. The increasing need for advanced physical security and focus on lowering expenses increases the demand for colocation. The growing industries like telecom, content creation, and healthcare increase demand for colocation. The high scalability, enhanced security, cost-efficiency, and flexibility of colocation drive the overall market growth.

Enterprise Size Insights

Why the Large Enterprises Segment Dominates the Data Center Market?

The large enterprises segment dominated the market in 2025. The massive generation of data in large enterprises and the higher need for security increase the demand for data centers. The increasing use of social media and the increasing expansion of workloads in large enterprises require data centers. The strong presence of large companies like Google, Amazon, & others and the increasing need for high-density servers increases demand for data centers, driving the overall market growth.

End User Insights

Which End User held the Largest Share in the Data Center Market?

The BFSI segment held the largest revenue share of the market in 2025. The shift towards digital banking and the strong focus on enhancing customer interactions in BFSI increase demand for data centers. The increasing need for advanced security for sensitive financial data and the growing use of mobile payments require data centers. The growing tasks like account details, high-frequency trading, financial trends, and customer transactions increase demand for data centers, supporting the overall market growth.

✚ Related Topics You May Find Useful

➡️ AI Data Centers Market: Explore how artificial intelligence workloads are reshaping data center architecture, power density, and infrastructure investment

➡️ Data Center as a Service Market: Understand the shift toward on-demand, scalable data center models driven by cloud adoption and cost optimization

➡️ Data Center Monitoring Market: Discover how real-time analytics, automation, and predictive maintenance are improving uptime and operational efficiency

➡️ Data Center Outsourcing Market: Analyze enterprise strategies focused on reducing IT complexity through third-party data center management

➡️ Data Center CPU Market: Track processor innovation as hyperscale and enterprise data centers demand higher performance and energy efficiency

➡️ Data Center Liquid Cooling Market: See how advanced cooling technologies are addressing heat challenges from high-density computing environments

➡️ Micro Mobile Data Center Market: Gain insight into compact, deployable data centers supporting edge computing and remote operations

➡️ Edge Data Center Market: Examine the growth of decentralized data centers enabling low-latency applications and real-time data processing

➡️ Data Center Networking Market: Understand evolving network architectures designed to support cloud traffic, AI workloads, and high-speed connectivity

➡️ Data Center Monitoring Market: Review key market highlights and performance trends shaping next-generation data center visibility tools

➡️ Data Center Accelerator Market: Explore rising adoption of GPUs, TPUs, and specialized accelerators powering AI, machine learning, and high-performance computing

Top Companies in the Data Center Market & Their Offerings:

Equinix, Inc.: Global leader in carrier-neutral colocation and high-performance interconnection services through its IBX® centers.
Digital Realty Trust, Inc.: Provides a comprehensive global platform for colocation, interconnection, and cloud-scale data center solutions.
NTT Ltd.: Delivers extensive hyperscale and regional data center campuses with a strong focus on high-density cooling and global connectivity.
Global Switch Ltd.: Operates large-scale, high-power-density facilities in major Tier 1 European and Asia-Pacific hubs.
CyrusOne Inc.: Specializes in building and operating highly scalable, tailor-made data center solutions for hyperscale and large enterprise customers.
Interxion: A Digital Realty Company: Serves as the European core for Digital Realty, providing highly interconnected colocation within major European markets.
China Telecom Corporation Limited: Operates a massive network of data centers across China and Asia, offering broad enterprise-scale hosting and connectivity.
China Unicom (Hong Kong) Limited: Provides large-scale integrated cloud and data center services, focusing on digital infrastructure across the Asia-Pacific region.
AT&T Inc.: Offers enterprise-grade colocation and managed hosting services integrated with its global telecommunications network.
Amazon Web Services, Inc. (AWS): Provides globally distributed hyperscale cloud infrastructure through its vast network of data centers.
Microsoft Corporation: Operates the Azure global cloud platform, delivering massive-scale computing and storage through its worldwide data center footprint.
Google LLC: Maintains a high-efficiency global network of data centers to power its Google Cloud platform and AI/data services.
IBM Corporation: Focuses on enterprise hybrid cloud data center solutions, emphasizing security and specialized AI workloads.
Oracle Corporation: Delivers high-performance cloud infrastructure (OCI) through its distributed global data center regions for enterprise databases and apps.
Cisco Systems, Inc.: Provides the essential networking, server, and security hardware that forms the backbone of modern data center environments.

Recent Developments

In January 2026, Saudi Arabia launched a 480MW capacity Hexagon Data Center in Riyadh. The center consists of direct liquid cooling systems and is known as the largest green data center in the world. The center’s operational availability is 99.995% and focuses on enhancing digital services. (Source: https://gulfbusiness.com)
In December 2025, InfraRed launched Qu Data Centers in Canada. The data center facilities are present across Edmonton, Ottawa, Calgary, Toronto, and London. The total capacity of the center is 49MW and offers high-quality data services. (Source: https://www.datacenterdynamics.com)
In October 2025, Netmountains launched a new data center in Germany. The center consists of VEL2 & VEL1 units and offers colocation & cloud services. (Source: https://w.media)

Segments Covered in the Report

By Component

Solution
Services

By Type

Colocation
Hyperscale
Edge
Others

By Enterprise Size

Large Enterprises
Small & Medium Enterprises (SMEs)

By End User

BFSI
IT & Telecom
Government
Energy & Utilities
Others

By Region

North America
- U.S.
- Canada
- Mexico
- Rest of North America
South America
- Brazil
- Argentina
- Rest of South America
Europe
- Western Europe
  - Germany
  - Italy
  - France
  - Netherlands
  - Spain
  - Portugal
  - Belgium
  - Ireland
  - UK
  - Iceland
  - Switzerland
  - Poland
  - Rest of Western Europe
- Eastern Europe
  - Austria
  - Russia & Belarus
  - Türkiye
  - Albania
  - Rest of Eastern Europe
Asia Pacific
- China
- Taiwan
- India
- Japan
- Australia and New Zealand,
- ASEAN Countries (Singapore, Malaysia)
- South Korea
- Rest of APAC
MEA
- GCC Countries
  - Saudi Arabia
  - United Arab Emirates (UAE)
  - Qatar
  - Kuwait
  - Oman
  - Bahrain
- South Africa
- Egypt
- Rest of MEA

Thank you for reading. You can also get individual chapter-wise sections or region-wise report versions, such as North America, Europe, or Asia Pacific.

Immediate Delivery Available | Buy This Premium Research Report@ https://www.precedenceresearch.com/checkout/3531

You can place an order or ask any questions, please feel free to contact at sales@precedenceresearch.com | +1 804 441 9344

Stay Ahead with Precedence Research Subscriptions

Unlock exclusive access to powerful market intelligence, real-time data, and forward-looking insights, tailored to your business. From trend tracking to competitive analysis, our subscription plans keep you informed, agile, and ahead of the curve.

Browse Our Subscription Plans@ https://www.precedenceresearch.com/get-a-subscription

About Us

Precedence Research is a worldwide market research and consulting organization. We give an unmatched nature of offering to our customers present all around the globe across industry verticals. Precedence Research has expertise in giving deep-dive market insight along with market intelligence to our customers spread crosswise over various undertakings. We are obliged to serve our different client base present over the enterprises of medicinal services, healthcare, innovation, next-gen technologies, semi-conductors, chemicals, automotive, and aerospace & defense, among different ventures present globally.

Web: https://www.precedenceresearch.com

Our Trusted Data Partners:

Get Recent News:

https://www.precedenceresearch.com/news

For the Latest Update Follow Us:

LinkedIn | Medium | Facebook | Twitter

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.