Google Cloud Seen Leading Hyperscalers as AI Compute Demand Drives 64% Capex Growth
Jefferies analysts say AI compute demand far exceeds supply, forecasting Google Cloud will lead hyperscaler cloud growth with capex up 64% in 2025 and 58% in 2026. A TD Cowen survey shows 55% of firms using Google Gemini and 80% of Google Workspace users likely to upgrade within 18 months.
1. AI Compute Demand Outpaces Supply
After recent Cloud Next discussions, analysts observed GPU supply shortages across generations, prompting hyperscalers to secure committed capacity and driving unmet AI infrastructure demand.
2. Google Cloud Hyperscaler Upside and Capex
Google Cloud is projected to deliver the strongest hyperscaler cloud upside, with capital expenditures rising 64% in 2025 and 58% in 2026 to support ongoing AI infrastructure expansion.
3. Enterprise Adoption of Google AI Tools
A corporate survey found 55% of decision-makers deploy Google Gemini and 80% of Google Workspace users plan to upgrade within 18 months, indicating growing AI monetization and ROI expectations.