Briefing at a Glance

  • The accelerating growth of computing demands from AI workloads and rising regulatory concerns are prompting enterprises to consider cloud options beyond traditional hyperscalers. According to Gartner, by 2030, Neocloud providers offering AI-optimized infrastructure will capture a 20% share of the competitive $267 billion AI cloud market. AWS, Microsoft, and Google currently hold the largest share of the overall cloud market.
  • Gartner Senior Director Analyst Enrique Castera stated in a press release that Neocloud providers' specialized focus on AI and high-performance workloads makes them an alternative to hyperscalers, driven by the rise in GPU-intensive computing demands. Data sovereignty requirements imposed by other countries also make Neocloud providers' strong technical control over data more attractive.
  • Castera said: "Neoclouds differentiate themselves through superior performance on AI workloads, flexible deployment models, and a strong commitment to data sovereignty, often at more competitive prices."

Deep Insights

As Neocloud providers rapidly expand their share of the AI cloud market, enterprises, hyperscalers, and frontier model providers are all actively securing the computing resources needed for AI workloads.

According to an April report from Synergy Research Group, Neocloud revenue reached $9 billion in Q4 2025, up 223% year-over-year, as GPU computing demand has outpaced hyperscalers' supply capacity. Neocloud provider Nebius partnered with Microsoft last year to deliver AI infrastructure. Meanwhile, CoreWeave signed a multi-year agreement in April with large language model provider Anthropic to provide computing power for the Claude family of AI models.

As Neoclouds partner with hyperscalers and LLM providers to supply computing resources, they are also becoming an option for enterprises to diversify their cloud portfolios and support AI projects. As AI scales across enterprises, CIOs are strategically considering different options for AI workloads.

Castera said technology leaders should prioritize hybrid architectures and evaluate Neocloud providers' offerings, which can provide broader access to high-performance AI workload computing and strong technical controls to ensure data sovereignty.

According to Gartner, enterprises operating globally face data sovereignty requirements imposed by GDPR regulations and the EU AI Act, with growing concerns over where AI data is stored and processed. Rising geopolitical concerns are also prompting enterprises to consider local digital resilience.

According to another Gartner report, global sovereign cloud spending is expected to grow 35.6% this year.

Castera said: "Organizations can leverage Neocloud providers to enhance AI capabilities while maintaining greater control over data sovereignty and regulatory compliance. These providers also help enterprises innovate faster by offering more flexible access to high-performance infrastructure, tailored specifically for AI workloads."