Saudi Arabia Data Center Market: Hyperscale Expansion Amid Cloud Adoption & Vision 2030

According to IMARC Group's latest research publication, the Saudi Arabia data center market size reached USD 2.1 Billion in 2024. The market is expected to reach USD 7.7 Billion by 2033, exhibiting a growth rate (CAGR) of 15.6% during 2025-2033.

How AI is Reshaping the Future of Saudi Arabia Data Center Market

• AI-Optimized Infrastructure Deployment: Hyperscale facilities are integrating GPU clusters and specialized hardware for LLM training and inference workloads, with facilities designed to handle 6% of global AI processing demands.
• Energy-Efficient Cooling Technologies: Advanced liquid cooling solutions reduce power consumption by up to 40% while managing heat loads from high-density AI chips, cutting operational costs and improving Power Usage Effectiveness metrics.
• Predictive Maintenance Systems: Machine learning monitors facility health in real-time, analyzing power systems, cooling equipment, and network infrastructure to prevent failures and optimize uptime for mission-critical operations.
• Intelligent Workload Management: AI algorithms dynamically allocate computing resources across distributed facilities, balancing loads between edge and core data centers to optimize latency and processing efficiency for cloud services.
• Automated Security and Compliance Monitoring: AI-powered systems continuously scan for cybersecurity threats, ensure data sovereignty compliance, and manage access controls, enhancing protection for government and financial sector data.

How Vision 2030 is Revolutionizing Saudi Arabia Data Center Industry

Vision 2030 is fundamentally transforming Saudi Arabia's data center landscape through massive infrastructure commitments and regulatory frameworks. The government unveiled its National Data Center Strategy in June 2025, targeting 1.5 gigawatts of capacity by 2030—one of the largest planned national builds in the Middle East. The Saudi Data and AI Authority (SDAIA) is constructing the Hexagon Data Centre in Riyadh, a 480 megawatt Tier IV facility set to become the world's largest government data center by capacity. With IT power capacity at 222 MW in early 2025 and plans to add 760 MW by 2030, the Kingdom is experiencing 29% annual growth. Investment commitments reached $21 billion in February 2025 alone. The government allocated $40 billion specifically for AI technology investments covering data centers, semiconductors, and AI companies. HUMAIN, the PIF-backed AI champion, is coordinating projects to handle 6% of global AI workload, with planned facilities near Riyadh and Dammam delivering 6.6 gigawatts by 2034.

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Saudi Arabia Data Center Market Trends & Drivers:

The market is surging on the back of unprecedented digital transformation investments reaching $13.3 billion by 2025, growing 17.2% annually according to the Ministry of Investment. Major smart city projects like NEOM, Smart Medina, and the Red Sea Project are embedding IoT devices, sensors, and automated systems requiring real-time data processing and storage. The Kingdom ranked seventh globally and first in MENA for government AI readiness in the Oxford Insights 2025 index, reflecting extensive digitalization across public sectors. E-government services, digital healthcare platforms, and enterprise software adoption are driving demand for robust infrastructure. Banking, education, retail, oil and gas, transportation, and manufacturing sectors are implementing CRM tools, big data analytics, and cloud services. The DEEM government cloud now merges data from 193 government entities, requiring sovereign infrastructure. With Saudi Arabia ranking fifth globally for AI sector growth, companies are increasingly building AI-ready facilities with high-density computing assets and GPU accelerators.

Cloud adoption is accelerating dramatically as businesses shift from traditional IT infrastructure to scalable, cost-effective solutions. Major hyperscalers are establishing local presence—Google Cloud and PIF announced a $10 billion partnership in May 2025 to build a global AI hub through HUMAIN. AWS is launching a Saudi Arabia cloud region in 2026, while Microsoft built three data centers in the Eastern Province also opening in 2026. Oracle operates cloud regions in both Jeddah (since 2020) and Riyadh (launched 2024). SAP established facilities in Riyadh and Dammam supporting digital transformation. Alibaba Cloud partnered with STC in 2022 to launch two Riyadh data centers. Colocation services are becoming the preferred option for businesses seeking affordable data management, with carrier-neutral facilities offering advanced cooling and power redundancy. Platform as a Service, Infrastructure as a Service, and Software as a Service products are enabling flexibility across industries. The shift toward colocation is particularly strong among SMBs and startups requiring secure, scalable, compliant infrastructure without capital-intensive proprietary builds.

The nationwide rollout of 5G networks is creating exponential growth in data consumption and IoT connectivity. Saudi Arabia's 5G infrastructure market is projected to reach USD 4,810.7 Million by 2033. Telecom operators are expanding coverage to support low-latency services and real-time communications. Manufacturing, utilities, logistics, and transportation are adopting smart devices generating continuous data streams requiring instant processing and analysis. Edge and core data centers are essential for managing these workloads efficiently. NEOM and Red Sea Project are integrating thousands of IoT sensors and devices needing decentralized computing and storage. Data localization regulations enforced by SDAIA require banks, healthcare providers, and government agencies to store sensitive data within the Kingdom, generating sustained demand for local facilities. Companies are either building proprietary centers or using third-party colocation and cloud services. Major investment from hyperscalers and colocation firms is reshaping the competitive landscape—DataVolt secured a $20 billion partnership with Supermicro, while HUMAIN partnered with AirTrunk for a $3 billion data center campus investment.

Saudi Arabia Data Center Market Industry Segmentation:

The report has segmented the market into the following categories:

Data Center Size Insights:

• Large
• Massive
• Medium
• Mega
• Small

Tier Type Insights:

• Tier 1 and 2
• Tier 3
• Tier 4

Absorption Insights:

• Non-Utilized
• Utilized

Regional Insights:

• Northern and Central Region
• Western Region
• Eastern Region
• Southern Region

Competitive Landscape:

The competitive landscape of the industry has also been examined along with the profiles of the key players.

Recent News and Developments in Saudi Arabia Data Center Market

• January 2025: NEOM and DataVolt signed a landmark agreement to develop a large-scale, sustainable data center campus in Oxagon, northwest Saudi Arabia, supporting the Kingdom's green technology objectives.
• February 2025: Alfanar Global Development announced a historic $1.4 billion investment at LEAP 2025 to build four world-class data centers strategically located in Riyadh and Dammam, focusing on cloud computing and AI-driven solutions.
• February 2025: EDGNEX, DAMAC Group's digital infrastructure division, unveiled plans at LEAP Saudi Arabia 2025 to deploy 500MW of data center capacity by 2030, emphasizing the Kingdom's cloud computing and AI requirements.
• May 2025: Super Micro Computer signed a strategic MOU with DataVolt to develop hyperscale AI campuses in Saudi Arabia, delivering high-density GPU platforms, storage, and rack systems with advanced liquid cooling solutions.
• May 2025: HUMAIN, a PIF subsidiary, signed a strategic alliance with NVIDIA to create AI factories within the Kingdom, starting with 18,000 NVIDIA GB300 Grace Blackwell chips for advanced AI processing capabilities.

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