What is the latest update in the data center market?

We define the data center market as the market for delivering and operating physical data center capacity (space, power, and cooling) used to host computing equipment.

We include colocation providers and hyperscale facilities (owned or leased) and the facility infrastructure required to power and cool IT loads.

We exclude the IT equipment and software inside the facility (servers/GPUs, storage, networking, and cloud services revenue).

And if you want to better understand this new industry, you can download our pitch covering the data center market.

Summary table of the most important updates in the data center market

We define the data center market as the market for delivering and operating physical data center capacity (space, power, and cooling) used to host computing equipment.

We include colocation providers and hyperscale facilities (owned or leased) and the facility infrastructure required to power and cool IT loads.

We exclude the IT equipment and software inside the facility (servers/GPUs, storage, networking, and cloud services revenue).

You can also get all the latest market news for the month here.

Piece of News	Category	Date	Source
SoftBank strikes a $4 billion deal to buy DigitalBridge, betting big on AI data centers	M&A	Dec 29, 2025	SoftBank
US power regulator forces PJM to write new data centers at power plants rules	Regulations & Policies	Dec 18, 2025	FERC
DayOne pulls off a monster $2 billion round to speed up hyperscale buildouts	Fundraisings	Jan 5, 2026	Telecom Ramblings
Apollo takes control of Stream Data Centers, fueling a multi-gigawatt pipeline	M&A	Nov 3, 2025	Apollo
Digital Realty buys its way into Malaysia with a Cyberjaya data center deal	M&A	Jan 19, 2026	Digital Realty
Digital Realty posts Q4 results as demand for AI-ready capacity stays hot	Financial results	Feb 5, 2026	Digital Realty
NTT lands 130MW of hyperscale deals across four US campuses	Customer wins	Dec 4, 2025	NTT Data
New York drops a shock bill: a 3-year pause on new data center permits	Regulations & Policies	Feb 6, 2026	NY Senate
DigitalBridge closes $11.7 billion of commitments for its latest digital infrastructure fund	Strategic Investments	Nov 18, 2025	DigitalBridge
$300 million comes into Vantage APAC via a big Aussie pension's strategic stake	Strategic Investments	Jan 20, 2026	Aware Super
DigitalBridge teams up with Korea's KT to chase AI factory data centers	Partnerships	Nov 26, 2025	DigitalBridge
Daikin snaps up Chilldyne, pushing deeper into liquid cooling for AI facilities	M&A	Nov 4, 2025	Daikin

How is the data center market doing now?

How do we define the data center market?

We define the data center market as the market for delivering and operating physical data center capacity (space, power, and cooling) used to host computing equipment.

We include colocation providers and hyperscale facilities (owned or leased) and the facility infrastructure required to power and cool IT loads.

We exclude the IT equipment and software inside the facility (servers/GPUs, storage, networking, and cloud services revenue).

This is also the definition we use in our report covering the data center market.

How big is the data center market in 2026?

The data center market is worth approximately $150 billion in 2026, with a range between $120 billion and $180 billion depending on how you count hyperscale facility spending.

This is not a random guess, if you want to know how we have come up with this estimate, you can read our data center market size analysis here.

This puts the data center market at roughly the same scale as the global pharmaceutical contract manufacturing market at $140 billion or the semiconductor equipment market at $130 billion.

The data center market scores 65 out of 100 for maturity, 85 out of 100 for competitive intensity, and 70 out of 100 for fragmentation, reflecting an established but rapidly evolving industry with fierce competition for power and sites.

How fast will the data center market grow in the future?

The data center market will grow at approximately 12% per year over the next decade, driven by AI workload expansion and persistent power constraints that support pricing power.

This growth rate means the data center market should reach roughly $236 billion by 2030 and climb to approximately $466 billion by 2036.

This makes the data center market one of the faster-growing infrastructure sectors, outpacing traditional real estate but growing slower than pure software markets.

What does current funding activity look like in the data center market?

Our team, who continually updates our data center market pitch deck, is keeping a close eye on the market and tracking key signals.

One of those signals is fundraising activity across startups. Each month, we refresh this page with a list of startups of the data center market that have raised funding, and we also publish a quarterly analysis here.

Is funding momentum accelerating or cooling in the data center market these days?

Data center dealmaking hit approximately $61 billion through November 2025, showing massive acceleration compared to previous quarters as institutional investors poured capital into capacity expansion.

Compared to Q4 2024, funding activity in the data center market jumped significantly in Q4 2025, driven by several mega-deals like SoftBank's $4 billion DigitalBridge acquisition and DayOne's $2 billion Series C.

Average deal sizes in the data center market climbed substantially in Q4 2025 versus both the previous quarter and the prior year, with billion-dollar transactions becoming more common as investors chase scalable platforms rather than single-site developers.

Which categories and business models are attracting capital in the data center market?

These categories and business models of the data center market are receiving important fundraising currently:

• Hyperscale campus developers like DayOne raised over $2 billion to build multi-gigawatt facilities because investors see speed-to-power as the critical competitive advantage.
• Digital infrastructure platforms like DigitalBridge closed $11.7 billion in commitments because large fund managers want exposure across multiple data center assets rather than betting on single operators.
• Asia-Pacific expansion vehicles like Vantage APAC secured $300 million from Aware Super as institutional capital follows digital demand growth in emerging markets.

The shift toward billion-dollar platform deals in the data center market shows investors now prefer buying scale and execution capability over developing new capacity from scratch.

Who's writing the most checks in the data center market?

These investors are being very active when it comes to fundraising in the data center market:

• SoftBank is a Japanese conglomerate that backed DigitalBridge with a $4 billion acquisition because it sees AI infrastructure as a strategic bottleneck worth controlling.
• Apollo is a private equity giant that completed the Stream Data Centers acquisition to build a multi-gigawatt US development platform targeting hyperscale customers.
• Aware Super is an Australian pension fund that invested $300 million in Vantage APAC because long-term institutional investors want exposure to Asia-Pacific data center growth.

The data center market is now attracting the largest institutional investors in the world, not just traditional infrastructure funds or venture capital firms.

Any big acquisitions or IPOs in the last three months in the data center market?

These are the big acquisitions and IPOs that happened recently in the data center market:

• SoftBank signed a definitive agreement to acquire DigitalBridge for $4 billion in the largest data center platform deal of Q4 2025, positioning AI infrastructure as a critical investment thesis.
• Apollo completed its acquisition of Stream Data Centers to control a major hyperscale campus developer with multi-gigawatt US capacity pipelines.
• Digital Realty entered Malaysia through the TelcoHub 1 acquisition as global operators race to plant flags in high-growth Southeast Asian markets.
• Daikin acquired Chilldyne to add liquid cooling technology capabilities as AI density requirements push beyond traditional air cooling limits.
• Blockfusion signed a SPAC merger agreement to test whether public markets will fund new data center capacity platforms at scale.

The wave of acquisitions in the data center market shows consolidation is accelerating as well-capitalized buyers absorb platforms that can deliver power-ready capacity faster than building from scratch.

How are companies in the data center market performing overall?

We are watching this market everyday, because we need to constantly update our pitch deck. Here is a couple of things we have noticed.

Are there any standout success metrics or financial results in the data center market?

These are the standout financial results from Q4 2025 in the data center market:

• Digital Realty reported fourth quarter 2025 results showing continued strong demand for AI-ready capacity across its global platform.
• NTT secured agreements totaling over 130 megawatts across four US campuses in Chicago, Dallas, Phoenix, and Virginia, demonstrating hyperscalers are still aggressively locking in capacity.
• Equinix announced Merck launched a liquid-cooled HPC system inside an Equinix AI-ready facility in Germany, proving colocation can handle high-density AI workloads.

Strong leasing activity and customer wins in the data center market confirm that demand is not slowing down despite record capacity additions across major markets.

Have there been any major partnerships in the data center market?

These are the major partnerships that happened recently in the data center market:

• DigitalBridge signed a strategic MOU with KT Corporation to develop next-generation AI data centers in Korea, unlocking access to land, power, and local demand.

Strategic partnerships in the data center market increasingly focus on unlocking regulatory approvals and grid access rather than just sharing technology or customers.

Have there been any notable technology or infrastructure breakthroughs in the data center market?

These are the notable technology breakthroughs from Q4 2025 in the data center market:

• Daikin acquired Chilldyne's negative-pressure liquid cooling technology to help data centers handle AI workloads that generate far more heat per rack than traditional compute.
• Merck deployed a liquid-cooled Lenovo HPC system inside Equinix, demonstrating that advanced cooling is moving from hyperscale-only to enterprise colocation environments.

Liquid cooling breakthroughs in the data center market are becoming essential infrastructure rather than experimental technology as AI density requirements keep climbing.

Have any companies restructured or shifted pricing or business model in the data center market?

No, there hasn't been any major restructuring or business model shifts during Q4 2025 in the data center market worth highlighting here.

Are there any other notable wins or successes in the data center market?

These are other notable wins from Q4 2025 in the data center market:

• Equinix was named a Leader in the IDC MarketScape for data center services sustainability, showing that environmental credentials are becoming a competitive advantage in enterprise sales.

Sustainability recognition in the data center market matters more now as large enterprises make renewable energy and emissions reporting mandatory procurement requirements.

What is the overall sentiment in the data center market right now?

Are there any notable recent opinion pieces, thought leadership about the data center market?

No, we don't think there has been any notable opinion pieces worth mentioning here during Q4 2025 in the data center market based on our available data.

Are there any interesting and recent market research reports about the data center market?

These are the interesting market research developments from Q4 2025 in the data center market:

• IDC published its MarketScape assessment for data center services sustainability, highlighting which operators are leading on environmental performance as enterprises demand proof of renewable energy commitments.

Research focusing on sustainability in the data center market reflects growing pressure from customers and regulators to reduce carbon footprints and water consumption.

Have there been any regulatory changes, policy updates, or new compliance requirements in the data center market?

These are the major regulatory developments from Q4 2025 in the data center market:

• FERC directed PJM to create new rules for data center co-location at power plants, forcing the nation's largest grid operator to standardize how large-load facilities connect directly to generation.
• New York proposed bill S9144 for a three-year moratorium on new data center permits, signaling state-level backlash against grid impacts and electricity rate concerns.

Regulatory developments in the data center market are pulling in opposite directions, with federal agencies trying to enable faster deployment while some states attempt to slow or pause new construction entirely.

Who is the author of this content?

NEW MARKET PITCH TEAM

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