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The rapid growth of AI workloads has helped drive expansion among smaller cloud companies, particularly those specializing in GPU-based infrastructure, according to Synergy Research Group
In sum – what to know:
Cloud spending reached $119B in Q4 – Global cloud infrastructure revenues hit $119.1 billion in Q4 2025, pushing the full-year market to $419 billion and marking the fastest growth rate in more than three years.
GenAI driving market expansion – Nearly half of the $46 billion increase in cloud revenues over the past eight quarters came from AI-specific cloud services, with AI also boosting broader cloud usage.
Neocloud providers gaining traction – AI-focused cloud firms such as CoreWeave and Crusoe are gaining momentum, particularly in GPU infrastructure, adding competitive pressure on hyperscale providers.
Global spending on cloud infrastructure services reached $119.1 billion in the fourth quarter of 2025, marking one of the largest quarterly increases ever recorded for the sector, according to recent data from Synergy Research Group.
The research firm said the surge reflects rapidly rising demand for artificial intelligence workloads, particularly generative AI.
Quarterly spending increased by almost $12 billion compared with the previous quarter and $29 billion year over year, bringing the full-year cloud infrastructure services market to $419 billion in 2025. Adjusted for currency fluctuations, that represents 30% growth compared with Q4 2024, the ninth consecutive quarter of accelerating year-on-year expansion and the fastest growth rate in more than three years.
Among the largest providers, Amazon maintained the top position with 28% market share, followed by Microsoft at 21%, and Google at 14%, though Synergy said the latter two companies continue to post higher growth rates.
According to John Dinsdale, chief Analyst and research director at Synergy Research Group, AI services have played a central role in driving the recent market expansion.
“Over the last eight quarters, the worldwide cloud infrastructure services market has grown from $73 billion (in Q4 2023) to $119 billion (in Q4 2025). Of that incremental growth of $46 billion, almost half comes from AI-specific cloud services. But the impact of AI technology goes beyond that. AI technology increasingly underpins the broader range of non-AI specific cloud services, enabling enhanced features, stimulating increased usage, and helping to grow revenues,” Dindsdale told RCR Wireless News.
Public cloud services accounted for the majority of spending growth. Synergy estimates that public IaaS and PaaS revenues increased 34% in Q4, with the top three providers controlling 68% of that segment.
The rapid growth of AI workloads has also helped drive expansion among smaller cloud companies, particularly those specializing in GPU-based infrastructure.
“Neoclouds like CoreWeave and Crusoe are undoubtedly having a big impact on the market. Their overall cloud market share may be small, but in the AI service segments their share is much more meaningful. And their presence does help to keep the bigger cloud players on their toes, forcing them to remain competitive,” Dinsdale said.
Cloud demand is also expanding geographically. The United States remains the largest cloud market by a wide margin, growing 30% year over year in Q4, while several countries — including Australia, India, Indonesia, Ireland, Mexico, South Africa and Taiwan — recorded growth rates above the global average when measured in local currencies.
Looking ahead, Dinsdale noted that the market’s continued expansion may eventually slow as the sector grows larger.
“Regarding 2026 and beyond, the law of large numbers will increasingly come into play. The larger the market, the more difficult it is to maintain growth rates. Even if the growth in dollar value increases, the percentage growth rate may drop off. Over the last two years the cloud market has defied that phenomenon, but the future growth rate will inevitably start to tail off a little,” he said.
