IDC: Cloud Infrastructure Revenues Surpassed Those for Traditional IT for the First Time on Record

Vendors’ cloud infrastructure revenues grew to $16.8 billion in the third quarter of 2018, surpassing revenues from sales into traditional IT environments for the first time on record, according to  International Data Corporation (IDC). The infrastructure  revenue figure included  servers, enterprise storage and Ethernet switches. The year-over-year gain was 47.2%.

The cloud IT infrastructure sales accounted for more than half (50.9%) of the total worldwide IT infrastructure vendor revenues, up from 43.6% in the third quarter of 2017.

However, the research firm cautioned that fourth quarter revenues were expected to be down compared to the year-earlier period, which means that spending on cloud IT infrastructure will represent less than 50% of total revenues for the full year (47.4%).

Cloud Infrastructure Revenues
Spending on all three technology segments in cloud IT environments is forecast to deliver double-digit growth in 2018, IDC added, with compute platforms to be the fastest growing at 59.1%, while spending on Ethernet switches and storage platforms will grow 18.5% and 20.4%, respectively.

“The first three quarters of 2018 were exceptional for the IT Infrastructure market across all deployment environments and the increase in IT infrastructure investments by public cloud data centers was especially strong, driven by the opening of new data centers and infrastructure refresh in existing data centers,” said Natalya Yezhkova, IDC research director, IT infrastructure and platforms, in a prepared statement. “After such a strong year we expect some slowdown in 2019 as the overall market cools down and some cloud providers work through adjustments in their supply chain. However, IDC expects the shift in IT infrastructure spending toward cloud environments will continue.”