Saudi Arabia Data Center Services Market: Cloud Adoption, Edge Computing & Growth Outlook

According to IMARC Group's latest research publication, Saudi Arabia data center services market size reached USD 1.9 Billion in 2025. The market is projected to reach USD 6.6 Billion by 2034, exhibiting a growth rate (CAGR) of 14.67% during 2026-2034.

How Vision 2030 is Transforming the Saudi Arabia Data Center Services Market

• Saudi Arabia is positioning itself as a regional digital powerhouse through Vision 2030, with data centers emerging as the backbone of this ambitious transformation. The kingdom's National Data Center Strategy aims to build up to 1.5 gigawatts of capacity by 2030, making it one of the largest planned national builds in the Middle East. This massive infrastructure push is attracting global hyperscalers who see the region as the next frontier for cloud and AI services.
• Major investments are flooding into the kingdom. AWS committed over 5.3 billion dollars to establish a new cloud region by 2026, while Microsoft completed three data centers in the Eastern Province representing a 2.1 billion dollar investment. Oracle pledged around 14 billion dollars over the next decade to expand cloud and AI services across Saudi Arabia. These commitments reflect the growing confidence in Saudi Arabia's digital future.
• The kingdom's competitive advantages are compelling. Energy costs for business customers can be as low as 5 cents per kilowatt-hour, among the lowest in the region. The government has established robust cybersecurity frameworks through the National Cybersecurity Authority, providing clear compliance guidelines that build investor confidence. Smart city megaprojects like NEOM and the HUMAIN AI initiative are creating unprecedented demand for high-density computing infrastructure, with HUMAIN targeting 6.6 gigawatts of capacity by 2034.
• Beyond infrastructure, Vision 2030 is fostering local digital capabilities. The government's cloud-first policy mandates that public sector organizations prioritize cloud solutions, driving consistent demand. Data residency laws require that certain data be stored locally, creating a protected market for domestic providers. Industrial zones and special economic areas offer additional incentives, from reduced electricity tariffs to streamlined approvals, making Saudi Arabia an increasingly attractive destination for data center investment across the Gulf region.

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Saudi Arabia Data Center Services Market Trends & Drivers:

Market Growth Drivers:

The surge in AI and cloud adoption is reshaping data center demand across Saudi Arabia. Organizations are deploying artificial intelligence for everything from predictive analytics in oil and gas operations to personalized customer experiences in retail and banking. This has created explosive growth in high-density computing requirements. Hyperscale facilities are expanding rapidly to accommodate GPU clusters and AI model training workloads. The government's HUMAIN initiative alone plans to handle around 6 percent of the world's AI workload, signaling the scale of ambition. Cloud service providers are responding by establishing multiple availability zones, ensuring low-latency access for businesses across healthcare, education, finance, and gaming sectors throughout the kingdom.

Market Trends:

Advanced cooling technologies are becoming essential as operators battle extreme desert temperatures that can significantly increase operational costs. Liquid cooling systems, AI-driven energy management, and modular designs are being deployed to reduce power usage effectiveness. Sustainability initiatives are gaining momentum, with data centers integrating renewable energy sources and implementing waste-heat recovery solutions. Tier IV facilities are dominating new builds, accounting for over 80 percent of recent capacity additions due to strict uptime requirements from enterprise and government clients. The shift toward edge computing is accelerating alongside nationwide 5G rollouts, with compact micro-blade servers supporting smart city applications and industrial IoT deployments across urban centers.

Saudi Arabia Data Center Services Market Industry Segmentation:

The report has segmented the market into the following categories:

Service Type Insights:

• Saudi Arabia Data Center Services Market
• Managed Hosting Services
• Colocation Service

Data Center Type Insights:

• Tier-I and II
• Tier-III
• Tier-IV

End User Industry Insights:

• BFSI
• Health Care
• Retail
• Manufacturing
• IT and Telecom
• Others

Regional Insights:

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

Competitive Landscape:

The market research report has also provided a comprehensive analysis of the competitive landscape. Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided.

Recent News and Developments in Saudi Arabia Data Center Services Market

• December 2025: Humain, backed by the Public Investment Fund, announced strategic partnerships with xAI and AMD-Cisco to develop 500 megawatts and 1 gigawatt of AI-focused data center capacity respectively, positioning Saudi Arabia as a major AI computing hub in the Middle East.
• December 2025: Al Moammar Information Systems was awarded a contract exceeding 1.88 billion Saudi Riyals by Humain to design and build a private AI-focused data center, reflecting the substantial investments flowing into specialized computing infrastructure.
• December 2025: center3, a subsidiary of stc group, entered a joint venture with HUMAIN to develop and operate advanced AI data centers with planned capacity up to 1 gigawatt, starting with an initial phase delivering 250 megawatts for high-density AI workloads.
• November 2024: ICS Arabia commenced construction on the Desert Dragon data center project, a joint venture with China Mobile International representing 1.9 billion dollars in investment over three years, with total capacity of 187 megawatts across multiple phases in Riyadh, Jeddah, Dammam, and NEOM.
• May 2025: The Saudi government officially launched the National Data Center Strategy through the Ministry of Communications and Information Technology and the Saudi Data and Artificial Intelligence Authority, targeting up to 1.5 gigawatts of data center capacity by 2030.

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