In Q3 2024, global enterprise spending on cloud infrastructure services was $84 billion, up 23% from the same period in 2023, with generative AI driving the market acceleration.

A study by Synergy Research Group shows that Q3 corporate spending on cloud infrastructure services reached $84 billion worldwide, up $15.7 billion from the third quarter last year.

This marks the fourth consecutive quarter of accelerating growth, largely driven by increased demand for generative AI. Cloud infrastructure service revenues, primarily from public IaaS and PaaS, also rose 24%, climbing to $83.8 billion in Q3 and $313 billion in trailing twelve-month revenues.

The surge in enterprise cloud spending is observed worldwide. However, there are notable increases in India, Japan, Brazil, and Italy. The U.S. remains the largest cloud market, outpacing the entire APAC region in scale, with a 23% growth rate in Q3. In Europe, the UK and Germany lead, while markets with the fastest growth rates include Ireland, Italy, and Spain.

Amazon leads the market with a 31% share, followed by Microsoft (20%) and Google (13%). All top three providers have seen their growth rates increase from a year ago, with the most robust improvements witnessed at Amazon and Google. In public cloud services, the three leaders account for 68% of the market.

As for the smaller market players, those with the highest year-on-year growth rates include Oracle, Huawei, Snowflake and Cloudflare.

AI-focused services are expected to further fuel the increased expenditure trend in the coming months. “New AI-oriented services and technology are helping the major cloud providers to ride a wave – new capabilities lead to increased demand, which leads to increased revenues, which then enables more investment in underlying technologies,” explains John Dinsdale, a Chief Analyst at Synergy Research Group.

Back in Q3 2023, we reported that, with the development of generative artificial intelligence systems, total capital expenditures by major companies like Google, Amazon, and Microsoft reached $42 billion, marking a 10% increase over Q2 2023.

Per Bank of America projections, in 2024, Amazon, Alphabet, and Microsoft will raise their combined capital expenditures in computing technologies to $116 billion. This would represent an increase from the $84 billion they collectively invested in 2022.