Driven by higher spending on new data centers, cloud data center capex bounced back to double-digit growth in the third quarter, according to a report by Dell'Oro Group.
Among the top 10 cloud providers, Amazon and IBM were the only two that grew their server capex to expand their server capacity. The top 10 cloud service providers, which include Amazon Web Services, Microsoft Azure, Google Cloud and IBM, spent $18 billion on data centers in the third quarter, which was a 14% year-over-year increase, according to Dell'Oro Group's 3Q 2018 cloud data center capex quarterly report.
"Cloud data center capex for the top-10 cloud service providers returned to growth after two straight quarters of year-over-year declines," said Baron Fung, director at Dell'Oro Group, in a statement. "We project that spending on servers will increase in 2020, as the major Cloud service providers revert to server capacity expansion and fill new data centers scheduled to launch next year."
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Dell'Oro Group expects the top 10 cloud providers to launch data centers in nearly 40 new regions next year.