Data Center Equipment Market Forecast, Top Players, and Growth 2031

The data center equipment market size was valued at US$ 242.74 billion in 2024 and is expected to reach US$ 669.29 billion by 2031; it is estimated to register a CAGR of 15.7% during 2025–2031. The growing interest in Advanced RISC Machine (ARM) servers in data centers is likely to bring new market trends.

Data Center Equipment Market Analysis

The data center equipment market has witnessed significant growth in recent years, driven by the increasing demand for digital services, cloud computing, and data storage solutions. As businesses and consumers rely more on digital platforms for daily activities, the need for robust, secure, and scalable data infrastructure has escalated. Data centers, which are facilities used to house critical IT systems and components such as servers, storage systems, networking equipment, and cooling systems, have become pivotal in supporting the growing volume of data. The market for data center equipment is primarily fueled by the rising investments in new data centers and a growing reliance on compute-intensive workloads. The proliferation of IoT devices and the growing focus on sustainability and energy-efficient equipment are expected to provide lucrative opportunities for the data center equipment market growth. The increasing interest in Advanced RISC Machine (ARM) servers in data centers is likely to be a key trend in the data center equipment market.

Data Center Equipment Market Overview

Data center equipment refers to the physical infrastructure and hardware necessary for storing, processing, and managing data. This equipment works together to ensure that a data center can store, process, manage, and secure large volumes of data and provide reliable network services. Data center equipment is designed for high durability and reliability, typically incorporating redundancy and failover mechanisms to ensure consistent availability. The components of data centers allow for the efficient processing, storage, and distribution of large amounts of data. Data center equipment includes servers, storage devices, cooling equipment, power distribution units (PDUs), racks, and enclosures. This equipment is crucial for ensuring that data centers function efficiently, securely, and with high availability.

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Data Center Equipment Market: Strategic Insights

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Data Center Equipment Market Drivers and Opportunities

Rising Investments in Data Centers

The world's data generation and consumption are increasing exponentially, driven by big data analytics, artificial intelligence, cloud computing, and the Internet of Things (IoT). This necessitates more data centers to store, process, and distribute this data, leading to a rising investment in data centers. Businesses are increasingly investing in building and expanding their data center infrastructure to meet the growing demands for data storage, processing, and management. A few instances are given below.

• In January 2025, a joint venture among OpenAI, Softbank, and Oracle planned to invest US$ 100 billion in artificial intelligence infrastructure, with the potential to scale up to US$ 500 billion. This investment includes the construction of 10 data centers, including one already under construction in Abilene, Texas. Each facility will span about 500,000 square feet.
• In February 2025, Blackstone Group and its development partner Panchshil Realty planned to develop India's single largest hyperscale data center with 500 MW capacity in Navi Mumbai with an investment of over US$ 2.3 billion (~₹ 20,000 crore). The 500 MW facility will cover 3 million sq ft across 14 buildings and operate on up to 65% renewable energy.

Due to the significant increase in investments in building new data centers, these facilities will need advanced equipment such as servers, storage devices, cooling systems, and power distribution units (PDUs). These components are essential for effectively storing, processing, and distributing large volumes of data, driving growth in the data center equipment market.

Increasing Adoption of IoT Devices

The Internet of Things (IoT) describes an extensively broad network of interconnected devices along with technologies that enable communications between these devices and the cloud. Recently, there has been a massive surge in the adoption of IoT technologies due to advancements in mobile and wireless connectivity technologies. Several industries are using IoT to improve efficiency and reduce the costs of their operations. According to IoT Analytics' State of IoT Summer 2024 report, there were 16.6 billion connected IoT devices by the end of 2023, and this figure is expected to rise to ~25.44 billion by 2030. As per a forecast by IoT Analytics, 75% of the total devices in use would be IoT by 2030.

As IoT devices continue to proliferate across industries, from smart homes and healthcare to manufacturing and transportation, the demand for data processing, storage, and management is skyrocketing. This surge in connected devices directly impacts the data center equipment industry, as these devices generate vast amounts of data that need to be stored, processed, and analyzed in real time, creating demands for powerful servers, storage solutions, and networking equipment capable of efficiently processing and managing this vast amount of data. Thus, increasing adoption of IoT devices is anticipated to provide lucrative opportunities for the data center equipment market growth.

Data Center Equipment Market Report Segmentation Analysis

Key segments that contributed to the derivation of the data center equipment market analysis are equipment type and tier type.

• Based on equipment type, the market is segmented into server, storage devices, cooling equipment, power distribution units (PDUs), racks, enclosures, and others. The server segment is further categorized into rack server, blade server, and tower server. The cooling equipment segment is subsegmented into air conditioners, chillers, air handling units, heat exchangers, and others. The power distribution units (PDUs) segment is further divided into switched rack PDU, metered rack PDU, monitored rack PDU, and basic rack PDU. The racks segment is segmented into enclosed racks, open frame racks, wall mount racks, and others. The servers segment dominated the market in 2024.
• Based on tier type, the data center equipment market is segmented into tier 3, tier 4, tier 1, and tier 2. The tier 3 segment dominated the market in 2024.

Data Center Equipment Market Share Analysis by Geography

• The data center equipment market is segmented into five major regions: North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South & Central America. North America dominated the data center equipment market in 2024. Europe is the second-largest contributor to the global data center equipment market, followed by Asia Pacific.
• The data center equipment market in North America is segmented into the US, Canada, and Mexico. North America is one of the frontrunners in terms of technological innovations and adoption. The rise in investments in data centers fuels the demand for data center equipment as businesses expand their digital infrastructure. This growth drives the need for more powerful servers, cooling systems, and networking devices to handle increasing data traffic and storage requirements. Companies in the region are working to establish facilities for artificial intelligence and cloud hyperscale businesses. This effort drives the market by creating specialized data centers that fulfill the high demands of performance, scalability, and energy efficiency required by these technologies. The rise of artificial intelligence (AI) workloads is transforming the data center sector, creating an unprecedented need for power-intensive infrastructure. AI organizations are rapidly affecting site selection, design, and operational needs, focusing on markets that offer scalable power capacity and innovative connectivity solutions. For example, in March 2025, Related Companies, L.P, a US real estate company, launched a new data center development unit and plans to build out gigawatts of capacity across the US and Canada. Related claims a near-term US$ 45 billion development pipeline totaling 5GW across the US and Canada. As AI and cloud computing require vast amounts of computational power and storage, data centers must be equipped with cutting-edge infrastructure, such as high-density servers and advanced cooling systems. This specialized focus accelerates the demand for data center equipment, such as advanced servers, networking devices, and energy-efficient solutions, which, in turn, fuels the market's growth.

Data Center Equipment Market Regional Insights

The regional trends and factors influencing the Data Center Equipment Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Data Center Equipment Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.

Data Center Equipment Market Report Scope

Data Center Equipment Market Players Density: Understanding Its Impact on Business Dynamics

The Data Center Equipment Market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.

Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.

Major Companies operating in the Data Center Equipment Market are:

1. Amazon Web Services Inc
2. Hewlett Packard Enterprise Co
3. International Business Machines Corp
4. Oracle Corp
5. Kyndryl Holdings Inc
6. Broadcom Inc

Disclaimer: The companies listed above are not ranked in any particular order.

Data Center Equipment Market News and Recent Developments

The data center equipment market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. A few of the developments in the data center equipment market are listed below:

• ABB acquired a minority stake in North Carolina company DG Matrix to support the commercialization of solid-state power electronics for generative AI data centers and renewable microgrids. The company’s Power Router platform replaces conventional systems with an all-in-one solution that is up to five times smaller and has a best-in-class energy efficiency of 98 percent. Financial details of the investment were not disclosed.

(Source: ABB, Press Release, March 2025)

• Legrand announced the acquisition of Computer Room Solutions (CRS), a leader in Data Centre infrastructure. With close to 20 years in operation, CRS is a premier player in the design, development, and commissioning of data center infrastructure.

(Source: Legrand, Press Release, April 2025)

Data Center Equipment Market Report Coverage and Deliverables

The "Data Center Equipment Market Size and Forecast (2021–2031)" provides a detailed analysis of the market covering the areas mentioned below:

• Data center equipment market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
• Data center equipment market trends, as well as market dynamics such as drivers, restraints, and key opportunities
• Detailed PEST and SWOT analysis
• Data center equipment market analysis covering key market trends, global and regional framework, major players, regulations, and recent market developments
• Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments for the data center equipment market
• Detailed company profiles