Saudi Arabia sees massive surge in Data Centres

• In 2024, the Kingdom of Saudi Arabia announced a $100 billion plan.
• Why? Become a leader in AI, data analytics, and advanced technology. 🚀
• This investment has already sparked several big deals in the data center industry.
• According to Bloomberg, Riyadh’s data center capacity is set to grow at a huge 37% per year until 2027.

But first, why does AI need more data centers?

If it feels like you’re hearing about data centers every day, you’re not alone.

Yes, there’s been a massive surge in data centers—thanks to AI.

To put it simply, AI needs a lot of computing power, storage, electricity and fast networking. Why? To train and run models smoothly.

For which you need data centers – a facility that houses powerful computer systems, storage devices, and networking equipment to store, process, and distribute data. These centers provide the backbone for digital services.

Why are large tech companies looking at Saudi Arabia for Data Centres?

PwC predicts AI could inject $320 billion into the Middle East economy by 2030, with Saudi Arabia and the UAE leading the charge.

Saudi’s AI sector alone is expected to contribute a jaw-dropping $235.2 billion to its GDP, making up 12.4% of its entire economy.

But why Saudi? According to Deloitte, by 2030, data centers could consume up to 4% of global electricity. 

Saudi finance minister, Mohammed Al-Jadaan, speaking at the World Economic Forum in Davos said, “For AI infrastructure, you need a lot of energy, preferably clean energy like renewables, and significant land,” 

And Saudi Arabia has competitive advantages in:

• Renewable energy
• Land availability
• and now even regulatory agility!

Saudi Arabia is making a regulatory framework to protect foreign-owned data centres set up in Saudi Arabia.

These rules will treat data centers like embassies, giving them extra security.

The goal is to make Saudi Arabia a top place for companies to store their data safely.

Mohammed Al-Jadaan further said – The goal is to create a safe and high-tech space for companies to handle their data. Businesses can process data in Saudi Arabia and then send it back to their home countries and other markets! (Inshort, Saudi aims to export Data instead of oil!)

And this has worked….List of data centers in Saudi Arabia

Equinix

• Announcement Date: February 2025, during the LEAP 2025 tech conference in Riyadh.
• Investment: Over $1 billion
• Project Details: Developing a 100MW data center in Jeddah to serve hyperscale and enterprise clients, aiming to attract Equinix’s global customers to the Middle East

Microsoft

• Data Center Academy:
  • Launch Date: February 11, 2025, in collaboration with the National IT Academy (NITA) during LEAP 2025.
  • Purpose: To develop local talent in data center operations and related fields.
    Microsoft News
• Cloud Regions:
  • Construction Completion: December 4, 2024, with three Azure Availability Zones in the Eastern Province.
  • Expected Availability: 2026.

Huawei

• The Chinese tech giant is establishing a Future Skills Centre to train 25,000 people in AI, cloud computing, and big data over the next five years.

DataVolt

• Capacity: 1.5GW sustainable data center
• Location: Neom City
• Investment: $5 billion
• Aligned with: Saudi Arabia’s $500 billion Neom vision

Zoom & center3

• Zoom is launching Saudi Arabia’s first Zoom node, leveraging Oracle Cloud in Riyadh.
• The company has also committed a $75 million investment in AI projects within the Kingdom.

Tencent Cloud:

• Entering the Middle East with a $150 million investment.
• Launching its first cloud region in Saudi Arabia.

KKR & Gulf Data Hub:

• Investing over $5 billion
• Expanding Saudi Arabia’s hyperscale data center footprint.

Saudi Aramco & Groq

• Saudi Aramco has partnered with U.S. chip company Groq to build the world’s largest AI inference data center—a significant move for AI-powered energy and digital transformation.

Alfanar Global Development

• Investing $1.4 billion to build four data centers in Riyadh and Dammam, adding a combined 88MW of capacity.

Pure Data Centres & Dune Vaults

• In November 2024, Pure DC partnered with Dune Vaults to develop hyperscale data center campuses in Saudi Arabia, each exceeding 100MW of IT capacity.

Beyond these, Google, AWS, Alibaba Cloud, and stc have also announced plans to establish cloud regions and data centers in the country, again running into billions of dollars!

Wrapping up…

While the world races to perfect AI in English, Saudi Arabia is pioneering Arabic-language AI models, giving it a first-mover advantage in regional innovation.

Saudi is also launching massive AI training programs to create the next wave of AI experts.

The bigger picture all seems to connect to Vision 2030 —Saudi Arabia’s bold plan to diversify its economy beyond oil.

To make this happen, Saudi Arabia is putting $300 billion into industries:

• Automotive
• Advanced manufacturing
• And of course – AI and cloud computing

As a result, the demand for cloud services, AI-ready systems, and large-scale data storage is skyrocketing.