According to the International Data Corporation (IDC) Worldwide Quarterly Enterprise Infrastructure Tracker: Buyer and Cloud Deployment, spending on compute and storage infrastructure products for cloud deployments, including dedicated and shared IT environments, increased 2.9% year over year in the third quarter of 2023 (3Q23) to $25.4 billion. Spending on cloud infrastructure continues to outgrow the non-cloud segment with the latter declining 8.2% in 3Q23 to $14.9 billion. The cloud infrastructure segment experienced a decline in unit demand of 23.9% with an increase in average selling prices (ASPs) mostly related to higher than usual GPU server shipments to hyperscalers.
"Cloud infrastructure spending continues shifting towards robust configurations aiming to address more complex workloads and supporting new AI initiatives," said Juan Pablo Seminara, research director, Worldwide Enterprise Infrastructure Trackers. "While some caution remains in face of the economic and socio-political challenges ahead, the spending outlook for 2024 is very positive with growth centered on the expectation that cloud-based spending will rebound at a double-digit pace throughout the year."
Spending on shared (public) cloud infrastructure reached $18.5 billion in the quarter, increasing 7.2% compared to a year ago. The shared cloud infrastructure category continues capturing the largest share of spending compared to dedicated deployments and non-cloud spending, accounting for 45.9% of total infrastructure spending in 3Q23. The dedicated (private) cloud infrastructure segment declined 7.2% year over year in 3Q23 to $6.9 billion.
For 2023, IDC is forecasting cloud infrastructure spending to grow 9.7% compared to 2022 and totaling $100.6 billion for the year. Non-cloud infrastructure is expected to decline 7.7% to $58.7 billion. Shared cloud infrastructure is expected to grow 13.9% year over year to $72.2 billion for the full year, while spending on dedicated cloud infrastructure is expected to remain flat (0.3% growth) in 2023 and reaching $28.3 billion for the full year. The subdued growth forecast for non-cloud infrastructure reflects the headwinds the market is facing while cloud spending remains strong due to new and existing mission-critical workloads, which often require higher-end, performance-oriented systems.