Riyadh Emerges as the Cloud Capital of the Middle East as Saudi Arabia’s Market Reaches USD 55.4 Billion by 2032

Saudi Arabia’s cloud computing market is on a remarkable growth trajectory, projected to reach USD 55.4 billion by 2032, advancing at a CAGR of 15.6% from 2026 to 2032. The market, valued at USD 20.1 billion in 2025, is being propelled by the Saudi Vision 2030 digital transformation agenda, the Cloud First Policy, and major investments in smart city megaprojects such as NEOM.

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With 97% of government services digitized under the National Transformation Program, the Kingdom is creating unprecedented demand for scalable cloud infrastructure across both public and private sectors. Between 2018 and 2024, the government invested USD 24.8 billion to enhance internet connectivity, enabling 99% population access to high-speed internet—a key catalyst for widespread cloud adoption among enterprises of all sizes.

The Cloud Computing Special Economic Zone (SEZ) in Riyadh is expected to account for 30% of total ICT spending by 2030, cementing Saudi Arabia’s position as a regional cloud hub. Reinforcing this commitment, the government has pledged an annual USD 2.5 billion budget allocation for public cloud services by 2026, underlining its ambition to modernize digital infrastructure across all sectors.

Enterprise Digital Transformation Accelerates Cloud Adoption

Businesses across Saudi Arabia are embracing cloud technologies to enhance agility, scalability, and operational efficiency. Cloud migration is enabling organizations to integrate AI, machine learning (ML), and big data analytics without heavy upfront infrastructure costs.

In the first half of 2024, 127 international companies established operations in the Kingdom — a 477% year-over-year increase — with many choosing Saudi Arabia as their regional headquarters. This influx of global enterprises is driving demand for enterprise-grade cloud services that meet local compliance and performance standards.

Vision 2030 and Smart City Megaprojects Power Market Expansion

As Saudi Arabia diversifies its economy beyond oil, cloud computing lies at the heart of its Vision 2030 agenda, enabling e-governance, smart cities, and digital healthcare ecosystems.

Under the Cloud First Policy, government entities are required to prioritize cloud-based solutions. This initiative has already yielded USD 1.33 billion (SAR 5 billion) in savings through the DEEM government cloud program, according to the Saudi Data and Artificial Intelligence Authority (SDAIA).

The establishment of the Riyadh SEZ is further strengthening the local ecosystem, providing access to world-class infrastructure, cutting-edge technology, and a skilled digital workforce. Global cloud giants such as AWS, Microsoft Azure, Google Cloud, Oracle, and Alibaba Cloud have launched or announced local data centers, ensuring data sovereignty and regulatory compliance within the Kingdom.

Smart city initiatives including NEOM and the Red Sea Project are driving massive demand for real-time data processing, IoT integration, and advanced analytics — all powered by robust cloud infrastructure. These initiatives are redefining urban planning, intelligent transport, and citizen engagement through data-driven innovation.

Market Segmentation Highlights

• Service Type:
• Infrastructure as a Service (IaaS) – Largest segment (30% share, 2025)
• Software as a Service (SaaS) – Fastest-growing segment (CAGR 15%+)
• Platform as a Service (PaaS)
• Deployment Model:
• Public Cloud – Largest (≈70% share)
• Hybrid Cloud – Fastest-growing (CAGR 15.9%)
• Enterprise Size:
• Large Enterprises – 75% share, led by BFSI and telecom sectors
• SMEs – Fastest growth (CAGR 16.0%), driven by pay-as-you-go flexibility
• End Users:
• Government & Public Sector – Largest category, backed by Cloud First Policy
• IT & Telecom – Fastest-growing (CAGR 15.8%)

Regional Insights: Riyadh Leads, Eastern Province Rising

• Riyadh holds the largest market share (45%), supported by government ministries, corporate headquarters, and major data center investments. The Oracle Cloud region and the Cloud Computing SEZ in Riyadh are driving innovation and attracting international partnerships.
• Eastern Province is the fastest-growing region (CAGR 15.7%), anchored by the energy and industrial sectors. Major infrastructure investments by Microsoft Azure, Google Cloud, and Saudi Aramco’s digital initiatives are accelerating adoption in manufacturing, logistics, and petrochemicals.

Competitive Landscape

The Saudi cloud market is moderately fragmented, with a mix of global hyperscalers and strong regional players. AWS, Microsoft, and Google Cloud lead the market with extensive service portfolios and strategic partnerships. Oracle and Alibaba Cloud continue to expand regional data centers, while STC Cloud and other local providers are strengthening the ecosystem with localized solutions and Arabic-language support.

Strategic collaborations with universities and training institutions are addressing cloud talent development, ensuring a sustainable pipeline of skilled professionals to support the nation’s digital economy.

Recent Strategic Developments

• May 2025: AWS and HUMAIN announce a USD 5 billion AI Zone investment to empower Saudi entrepreneurs.
• May 2025: LTIMindtree and Aramco Digital launch NextEra, an AI- and cloud-focused IT services firm.
• Feb 2025: Accenture partners with Google Cloud to expand generative AI solutions in Saudi Arabia.
• Feb 2025: SAP SE brings its Business Technology Platform to Google Cloud Saudi Arabia, enhancing compliance options.
• Dec 2024: Microsoft completes construction of three Azure availability zones in the Eastern Province.
• Aug 2024: Oracle launches its second Saudi cloud region; Google unveils new AI and data sovereignty capabilities in Dammam.

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U.S. Cloud Computing Industry Accelerates with Technological Innovations and Cost Efficiency

According to the latest market research study published by P&S Intelligence, the U.S. cloud computing market is experiencing unprecedented growth, with its valuation soaring from USD 296.91 billion in 2024 to a projected USD 3,501.32 billion by 2032. This remarkable expansion, marked by a CAGR of 36.25% from 2025 to 2032, is driven by rapid technological advancements, the proliferation of mobile devices in enterprises, escalating data volumes, and the pressing need to curtail IT infrastructure expenses.​

In the current business landscape, organizations across various sectors are transitioning to cloud infrastructure to enhance operational efficiency, reduce costs, and gain a competitive edge. Cloud computing offers access to advanced computing capabilities and secure data storage solutions, enabling businesses to scale without the burden of hefty infrastructure investments. The integration of artificial intelligence (AI) into cloud services further amplifies this growth, facilitating the development of hyperscale platforms that automate processes, analyze vast datasets, and enhance customer interactions.​

Key Insights

• The U.S. cloud computing market is consolidated, with major players like Amazon Web Services (AWS), Microsoft Azure, and Google Cloud holding significant market shares. Their extensive data facilities, advanced technological infrastructure, and robust security measures create substantial entry barriers for smaller competitors.​
• The IT & telecom sector emerges as the largest end-user category, leveraging cloud solutions to manage vast data volumes, enhance communication networks, and deploy innovative services.​
• Regionally, the western U.S. holds the largest market share, attributed to the presence of major tech hubs and a high concentration of cloud service providers. Conversely, the southern U.S. is identified as the fastest-growing region, driven by increasing investments in digital infrastructure and a surge in cloud adoption among enterprises.​
• The market's growth is further propelled by the rising adoption of mobile devices within enterprises, necessitating scalable and flexible cloud solutions to manage and secure data effectively.​
• The demand for reducing IT infrastructure expenses compels organizations to shift towards cloud computing, which offers cost-effective alternatives to traditional on-premise systems.​
• Cloud computing's synergy with AI technologies enables businesses to automate processes, derive actionable insights from big data, and enhance decision-making capabilities, thereby improving overall operational performance.​
• The preference for Software as a Service (SaaS) models is growing, as they provide user-friendly software solutions that are easily accessible and automatically updated, catering to the dynamic needs of modern enterprises.​
• The market's consolidated nature, dominated by a few key players, underscores the importance of innovation and strategic investments in AI and automation to maintain competitive advantage and meet the evolving demands of businesses.​

This comprehensive analysis underscores the transformative impact of cloud computing on the U.S. business landscape, highlighting the critical role of technological advancements and strategic investments in shaping the future of the industry.

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Hybrid Category is the Key Contributor of Cloud Supply Chain Management Industry

The cloud supply chain management market was about USD 10.8 billion in 2023, which will reach to about USD 37.6 billion in 2030, powering at a rate of 19.7% by the end of this decade. The increasing acceptance of cloud technologies, the growing requirement for flexibility and agility, growing e-commerce & omnichannel retailing, and requirement for data-powered decision making are powering the growth of the industry.

The hybrid category, based on deployment type, is a key contributor to the industry. Businesses more and more recognize the value of joining on-premise infra with the flexibility and scalability offered by public cloud solutions. This hybrid process allows a unified incorporation of data security along with control, improving SCM procedures. 

As businesses are trying to strike a balance among operational efficiency and privacy, the hybrid cloud ascends as a significant force shaping the landscape of cloud SCM. For example, as per a survey published in 2022, 82% of respondents of the survey reported that they have used the hybrid cloud.

The retail & e-commerce category will power considerably in the future. This can be for the reason that most key players accept cloud-based techs to improve their supply chains with better visibility along with data insights. Tech incorporations are emphasized on understanding the journey of the consumers and providing a considerable enhancement.

North America leads the cloud supply chain management market. In the U.S., customers assist from numerous transportations means available in their more and more connected environment. Logistics businesses provide services for example SCM software, packaging, warehousing, material handling, returned goods management, brokerage, and forwarding.

Key healthcare providers or suppliers are collaborating with tech providers to improve the agility of their supply chain capabilities by using cloud services for faster responses through faster lead times and improving service with less total expenses.

Moreover, with the altering workload of the cloud environment, together with the growing need for improved infra management, the industry will grow in the years to come.

It is because of the mounting acceptance of cloud technologies all over the world, the demand for cloud supply chain management is on the rise.

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Asian Green Technology and Sustainability Market Is Driven by Accelerating GHG Emissions

The market size of the Asian green technology and sustainability is estimated to reach USD 5,816.3 million by 2023, with an annual growth rate of 11.1% over the period between 2023 and 2030, resulting in a total value of USD 12,072.6 million by 2030.

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The region is fortified with a robust manufacturing base, which is why it is observing the fast acceptance of IoT in different verticals, which is primarily boosting the demand for green tech solutions and services.

In 2023, the IoT category dominated the industry with a market share of 42.6%, and the category is also projected to experience the fastest growth during the projection period, credited to the advantage of this technology in terms of item sustainability and ecological manufacturing.

The development in the demand for IoT devices is credited to the improvements in IoT sensor techs, wireless connectivity, and sustainable results, which are inspiring a huge count of companies to embrace the digital revolution. With IoT solutions, businesses are turning toward more energy-efficient practices and establishing operational procedures in a way that decreases waste. Businesses are using IoT for sustainability in 7 different ways— air pollution monitoring, smart energy management, fleet management, smart waste management, smart farming, smart water management, and cold chain monitoring.

Carbon dioxide concentrations in the atmosphere are increasing primarily by man and industry, for example through the burning of coal, oil, or gas as well as deforestation. In response to rapid economic growth and energy usage, carbon emissions in Asia, especially China, have been rising sharply over the past few years. Between all the release sources, coal is responsible for over 60% (7.96 billion tons) of the releases from industries in the nation in 2021.

In 2023, the green buildings category had the largest share, of approximately 40.4%. With the increasing industrialization and commercialization across Asian nations, the construction of buildings has been increasing, in order to fulfill the space needs of businesses and residents.

As a significance of the resulting surge in energy generation, carbon emissions are growing at an alarming rate. Thus, to cope with the increasing energy needs without damaging the environment, the addition of green technologies in buildings has been on the surge. Green buildings are vital in justifying the negative externalities related to construction activities. 

From the viewpoint of decreasing GHG emissions and power use, green buildings have substantial contributions, because of their usage of recyclable materials, renewable energy, and low-carbon components and maintainable operation and maintenance patterns.

Hence, the Asia green technology and sustainability industry is driven by the alarming rate of GHG emissions and rising energy demand.

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