Hyperscale operator capex topped $37 billion in Q3, which easily set a new quarterly record for spending, according to Synergy Research Group (SRG). Total spending for the first three quarters of this year reached $99 billion, which marked a 16% increase over the same period last year.
Synergy Research Group's latest data found that cloud service provider capex that was targeted at data centers in the first three quarters increased by 18% compared to 2019.
The top-four hyperscale spenders in the first three quarters of this year were Amazon, Google, Microsoft and Facebook. Those four easily exceeded the spending by the rest of the hyperscale operators.
Following the top-four, the next biggest spenders were Apple, Alibaba and Tencent. SRG's data found that capex growth was particularly strong across Amazon, Microsoft, Tencent and Alibaba while Apple's spend dropped off sharply and Google's also declined.
Falling in line after the top-seven spenders were IBM, JD.com, Baidu, Oracle, and NTT.
“As expected the hyperscale operators are having little difficulty weathering the pandemic storm. Their revenues and capex have both grown by strong double-digit amounts this year and this has flowed down to strong growth in spending on data centers,” said John Dinsdale, a chief analyst at SRG, in a statement. “They generate well over 80% of their revenues from cloud, digital services and online activities, all of which have seen Covid-19 related boosts. As these companies go from strength to strength they need an ever-larger footprint of data centers to support their rapidly expanding digital activities. This is good news for companies in the data center ecosystem who can ride along in the slipstream of the hyperscale operators."
A large chunk of hyperscale capex went toward building, expanding and equipping large data centers, which grew in number to 573 at the end of Q3. SRG's hyperscale data was based on analysis of the capex and data center footprint of 20 of the world’s major cloud and internet service firms, including the largest operators in IaaS, PaaS, SaaS, search, social networking and e-commerce.
In aggregate those 20 companies generated revenues of over $1.1 trillion in the first three quarters of the year, up 15% from 2019.