Global spending on artificial intelligence (AI) infrastructure is projected to soar to $758 billion by 2029, according to the latest report from analyst firm IDC.
IDC reported that organizations spent $82 billion on compute and storage hardware for AI deployments in the second quarter of 2025, marking a 166% year-over-year increase.
The surge underscores the accelerating demand for high-performance infrastructure, particularly servers optimized for AI workloads.
Cloud and shared environments continue to dominate AI infrastructure investments, accounting for 84.1% of total AI spending in Q2 2025.
Hyperscalers, cloud service providers, and digital service firms contributed 86.7% of the total, cementing their role as the primary drivers of global AI infrastructure expansion.
Servers represented 98% of total AI-centric spending during the quarter, growing 173.2% year-on-year. Among these, servers with embedded accelerators — such as GPUs — captured 91.8% of server-related AI infrastructure spending, expanding 207.3% compared to last year.
IDC expects accelerated servers to comprise more than 95% of all AI server spending by 2029, growing at a five-year compound annual growth rate (CAGR) of 42%.
IDC attributed much of the upward revision in its forecast to stronger-than-expected GPU demand in the United States. The research firm noted that instead of slowing down, AI-related infrastructure investment is expected to continue rising through 2026.
“There is a distinct possibility that more AI-related investment will be announced in the coming years that will add to and extend the current mass deployment phase of accelerated servers well into 2026 and even beyond,” said Lidice Fernandez, group vice president for Worldwide Enterprise Infrastructure Trackers at IDC.
She added that hyperscalers and cloud providers will remain the main adopters, with research and education institutions increasingly contributing to demand toward the end of the decade.
Storage infrastructure also saw notable growth, expanding 20.5% year-over-year in Q2 2025, driven by the need to handle vast datasets used in AI training and inference. Nearly half (48%) of storage-related spending came from cloud-based deployments.
Geographically, the United States led with 76% of total AI infrastructure spending, followed by China (11.6%), Asia-Pacific excluding Japan (6.9%), and EMEA (4.7%).
IDC expects China to post the fastest growth rate through 2029, with a projected CAGR of 41.5%, followed by the US at 40.5%, EMEA at 17.3%, and APJ at 14.3%.
By the end of the forecast period, IDC estimates that accelerated servers will account for 94.3% of the global AI infrastructure market, underscoring the critical role of hardware acceleration in powering the next wave of AI innovation.
