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Global data center market expected to remain tight through 2026 amid surging AI power demand
Saturday, February 28, 2026 at 08:47 AM
Goldman Sachs forecasts the global data center market will face structural supply constraints through 2026. Hyperscaler capital expenditure is projected to double by 2029 compared to 2025 levels. Global power demand for data centers is expected to increase from 74 GW in late 2025 to 110 GW by 2030, with AI workloads growing to occupy 40% of that capacity.
Context
The global data center market is entering a multi-year period of structural tightness, with peak occupancy expected to persist through 2026. This capacity crunch is fueled by an unprecedented doubling of hyperscaler capital expenditure, projected to reach record levels by 2029. Industry leaders like Nvidia are already seeing the direct impact of this surge, recently reporting record quarterly revenue of $68.1 billion driven by massive data center demand. Meanwhile, Google is aggressively scaling its infrastructure investments, with 2025 capital expenditure guidance exceeding $90 billion to secure the power and space necessary for next-generation AI.
Surging demand for AI workloads is radically reshaping global energy requirements, with total power needs reaching 74 GW by the end of 2025. This figure is forecast to grow 42% to 110 GW by 2030, at which point AI will represent nearly 40% of the entire market. For semiconductor giants like AMD and Nvidia, this transition from traditional cloud services to power-intensive AI inference signals a long-term structural shift in the supply chain. Market conditions are not expected to stabilize until 2028, when new supply finally brings occupancy rates back to approximately 90%.
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