Market Overview

The Middle East data center market size reached USD 6,122.3 Million in 2025. Looking forward, IMARC Group expects the market to reach USD 19,290.5 Million by 2034, exhibiting a growth rate (CAGR) of 13.60% during 2026-2034. This expansion is driven by the rising digital transformation initiatives, increasing adoption of cloud services, and the rapid deployment of 5G networks, which collectively boost demand for advanced data processing and storage solutions. For more detailed insights, visit the Middle East Data Center Market. 

How AI is Reshaping the Future of Middle East data Center Market

• AI technologies are boosting data center operational efficiency by optimizing power consumption and cooling mechanisms, leading to greener data centers aligned with sustainability goals.

• Integration of AI-powered analytics improves predictive maintenance, reducing downtime and enhancing reliability for Middle East data centers.

• Governments in the region support digital transformation and smart city initiatives, accelerating AI adoption in data center infrastructures.

• AI enhances cybersecurity in data centers by detecting and responding to threats in real-time, crucial for protecting sensitive data across BFSI and government sectors.

• Companies like Etisalat and Gulf Data Hub are incorporating AI technologies to enhance service offerings and optimize data processing capabilities.

• The surge in cloud services and e-commerce demands AI-driven scalable solutions to manage vast data volumes efficiently.

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Market Growth Factors

The Middle East data center market is experiencing explosive growth, driven primarily by the rapid adoption of artificial intelligence and high-performance computing needs. Sovereign AI programs in countries like Saudi Arabia and the UAE are fueling massive hyperscale campuses, with investments from global players such as Microsoft, AWS, and Google establishing cloud regions and AI-optimized facilities. These developments are projected to triple regional capacity from around 1GW in 2025 to over 3GW in the coming years, as rack densities rise and liquid cooling becomes essential for GPU-intensive workloads. This trend positions the region as an emerging global hub for AI infrastructure and innovation.

Government-led digital transformation initiatives and ambitious smart city projects are key drivers accelerating data center expansion across the Middle East. Vision 2030 in Saudi Arabia and similar strategies in the UAE promote cloud localization, e-government services, and data sovereignty, attracting foreign investments while boosting local digital economies. Projects like NEOM and Dubai's smart initiatives require robust infrastructure for IoT, 5G, and edge computing, leading to a surge in colocation and hyperscale developments. These efforts are expected to double market size by 2030, supported by regulatory incentives and improved connectivity.

Sustainability and renewable energy integration are emerging as critical trends in the Middle East data center sector, addressing high energy demands and environmental concerns. With abundant solar potential and commitments to net-zero goals, operators are adopting green sources, advanced cooling technologies, and efficient designs to reduce carbon footprints amid water scarcity challenges. Governments in the UAE and Saudi Arabia target significant renewable mixes by 2030-2050, while facilities incorporate solar-powered operations and liquid immersion cooling. This focus enhances attractiveness for hyperscalers and aligns with global ESG standards, supporting long-term market growth.

IMARCs report provides a deep dive into the Middle East data center market analysis, outlining the current trends, underlying market demand, and growth trajectories.

Market Segmentation

Component Insights:

• Solution
• Services

Type Insights:

• Colocation
• Hyperscale
• Edge
• Others

Enterprise Size Insights:

• Large Enterprises
• Small and Medium-sized Enterprises

End User Insights:

• BFSI
• IT and Telecom
• Government
• Energy and Utilities
• Others

Country Insights:

• Saudi Arabia
• Turkey
• Israel
• United Arab Emirates
• Iran
• Iraq
• Qatar
• Kuwait
• Oman
• Jordan
• Bahrain
• Others

Recent Developement & News

• July 2025: The UAE government partnered with leading technology firms to launch a cloud innovation hub, accelerating AI and 5G integration in national data centers, enhancing data processing capabilities and digital transformation.

• August 2025: Gulf Data Hub expanded its colocation services with a new hyperscale data center in Saudi Arabia, targeting increased enterprise demand for scalable and secure cloud infrastructure.

• October 2025: Industry reports revealed a surge in demand for green data centers in the Middle East, with over 40% of new data center projects incorporating renewable energy sources and advanced cooling technologies, underscoring sustainability priorities.

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About Us

IMARC Group is a global management consulting firm that helps the world’s most ambitious changemakers to create a lasting impact. The company provide a comprehensive suite of market entry and expansion services. IMARC offerings include thorough market assessment, feasibility studies, company incorporation assistance, factory setup support, regulatory approvals and licensing navigation, branding, marketing and sales strategies, competitive landscape and benchmarking analyses, pricing and cost research, and procurement research.

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