Cloud computing and artificial intelligence are driving an unprecedented surge in hyperscaler investment and reshaping the geography of global digital infrastructure
Executive Summary
- Record Expansion: U.S. and European data center absorption continues at record levels, over 10.2 GW in 2024 alone, with capital expenditures from the four largest hyperscalers projected to exceed $400 billion globally in 2025.
- The Power Bottleneck: Transmission congestion, permitting delays, and energy scarcity are restricting supply pipelines, especially in primary hubs like Northern Virginia, Frankfurt, and Dublin.
- Market Shift: These power constraints are redirecting development toward emerging data center markets with available capacity, favorable regulation, and lower costs.
- Investor Implication: The persistent supply-demand imbalance in data center power and capacity is creating outsized opportunities for investors, developers, and operators that are able to deliver scalable, power-secure solutions.
The Hyperscaler Arms Race The past decade transformed cloud computing into a foundational component of the global economy. Amazon Web Services, Microsoft Azure, Oracle, and Google Cloud have turned digital infrastructure into a core utility, with combined cloud revenue run rates at $440 billion annually, and growing at a compounded 22% rate since 2016.
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Supporting documents
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