Gartner projects global end-user spending on public cloud services to reach $723.4 billion in 2025, marking a 21.5% increase from $595.7 billion in 2024. The research attributes this growth to the expanding role of artificial intelligence (AI) technologies in IT and business operations, as well as the increasing adoption of hybrid, distributed, and multicloud environments. These findings were presented during the Gartner IT Infrastructure, Operations & Cloud Strategies Conference in London, which concludes tomorrow.
Sid Nag, Vice President Analyst at Gartner, noted that the demand for public cloud services is driven by the growing reliance on AI and cloud-native solutions. This trend is pushing organizations to adopt cross-cloud frameworks to support business outcomes.
The report forecasts that 90% of organizations will have embraced a hybrid cloud model by 2027. In the immediate future, data synchronization across hybrid cloud environments will be a critical challenge, especially as businesses incorporate generative AI (GenAI) into their operations. Gartner highlights that infrastructure and operations (I&O) leaders must prioritize integrating AI and GenAI strategies into their frameworks to manage workloads effectively, particularly at the edge.
Double-Digit Growth Across Cloud Segments
All segments of the public cloud market are predicted to achieve double-digit growth in 2025. Infrastructure-as-a-Service (IaaS) is expected to see the largest growth, with spending increasing by 24.8% to $211.9 billion. Platform-as-a-Service (PaaS) spending is forecasted to rise by 21.6% to $208.6 billion. Software-as-a-Service (SaaS) is anticipated to grow by 19.2%, reaching $299.1 billion.
Cloud Infrastructure and Platform Services (CIPS) Driving Growth
The growth of IaaS and PaaS is tied to the increasing demand for Cloud Infrastructure and Platform Services (CIPS), which Gartner defines as integrated cloud services delivering both infrastructure and platform capabilities. Organizations are gravitating toward CIPS for its ability to manage the complexities of modern workloads, streamline operations, and facilitate the development and deployment of advanced AI applications.
In 2025, spending on CIPS is projected to grow by 24.2%, reaching $301 billion and accounting for 72% of IT spending on IaaS and PaaS. Gartner highlights that the adoption of cross-cloud integration frameworks (CCIF) will further support the demand for multicloud models, enabling federated GenAI capabilities and advanced use cases.
