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June 16, 2021 | ChannelPro

Worldwide Data Center Capex Growth Attained Highest Level in Four Quarters in 1Q21, According to Dell’Oro Group

Cloud Hyperscalers Easing Out of Digestion Cycle

According to a recently published report from Dell’Oro Group, the trusted source for market information about the telecommunications, networks, and data center IT industries, worldwide data center capex is starting to show signs of recovery with 7 percent growth in 1Q21, the highest level of growth since the start of the pandemic a year ago. However, the Cloud hyperscalers are still easing out of the current digestion cycle at a measured pace, and are not projected to surpass 20 percent growth until 2H 2021.

“Capex on data center construction and network infrastructure returned to double-digit growth in 1Q21,” said Baron Fung, Research Director at Dell’Oro Group.”However, spending on servers grew marginally, with higher server average selling prices offset by the decline in unit shipments. We anticipate the cost of servers to continue to climb throughout the year, due to rising commodity and supply chain costs, adoption of accelerated servers, and ramp of the new servers based on the Intel Ice Lake processors,” explained Fung.

Additional highlights from the 1Q21 Data Center Capex Quarterly Report:

  • Servers accounted for 39 percent of data center capex in 1Q21.
  • Top server vendors by revenue include Dell, HPE, and Inspur. White box server vendors lost share due to Cloud softness.
  • Top 10 Cloud service providers projected to increase data center capex by 18 percent in 2021.

About the Report
Dell’Oro Group’s Data Center Capex Quarterly Report details the data center infrastructure capital expenditures of each of the ten largest Cloud service providers, as well as the Rest-of-Cloud, Telco, and Enterprise customer segments. Allocation of the data center infrastructure capex for servers, storage systems, and other auxiliary data center equipment is provided. The report also discusses market trends, drivers of the leading Cloud service providers’ capex growth during the quarter, and the outlook for the next year. To purchase this report, please contact us at

About Dell’Oro Group
Dell’Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, networks, and data center IT markets. Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions. For more information, contact Dell’Oro Group at +1.650.622.9400 or visit

SOURCE Dell’Oro Group

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