Dell’Oro Group Reports Data Center Physical Infrastructure Market Reached $10.9 Billion in 4Q 2025

Dell’Oro Group reports the worldwide data center physical infrastructure market reached $10.9 billion in manufacturer revenue in 4Q 2025, about 20% higher year over year, with vendor backlogs building across power, cooling, and distribution.

Market Overview

The report says 4Q 2025 manufacturer revenue totaled $10.9 billion and grew approximately 20% year over year. It describes the quarter as concluding a year of expanding demand across most infrastructure categories.

It frames the data center physical infrastructure outlook as tied to ongoing AI-related investment, including demand continuing to outpace supply across multiple infrastructure categories.

What the Analyst Says

Alex Cordovil, Research Director at Dell’Oro Group, said, “What stands out in 4Q 2025 is not just the headline growth number—it’s the breadth of vendor backlogs building across power, cooling, and distribution segments simultaneously.”

Cordovil also said, “This synchronized backlog surge is a strong leading indicator for 2026, and our forecast reflects a modest upward revision to our outlook.”

Category Highlights

Direct Liquid Cooling (DLC) “maintained exceptional growth,” continuing a multi-year expansion trajectory tied to Artificial Intelligence (AI) cluster deployments that use liquid-cooled architectures.

Uninterruptible Power Supply (UPS) system revenue “sustained steady growth,” with demand concentrated in high-capacity three-phase systems for larger cluster sizes and higher-density data halls for AI workloads.

Regional and Customer Segment Notes

The report states North America continued to lead global growth, attributed to hyperscalers investment and “favorable policy frameworks” supporting domestic AI infrastructure expansion.

It adds that EMEA and Asia Pacific are expected to accelerate through 2026 as vendor pipelines mature.

Demand Mix

The report says hyperscalers and colocation providers remained the dominant demand engine, accounting for “the substantial majority of DCPI revenue growth.” It also states enterprise and telco segments maintained more measured investment levels.

This Analyst Signals brief reflects a neutral, fact-based summary of the original research note.