CITIC SEC released a research report stating that robust demand for AI model training and inference is expected to continue driving the performance of cloud computing providers. Although tight computing power supply has somewhat constrained the acceleration, sustained investments by major players and the gradual delivery of data centers are likely to ease supply constraints by 2026, leading to more stable order fulfillment. Overall, based on the pace of order fulfillment and data center reserves, cloud providers' revenue growth in 2026 is projected to accelerate further compared to 2025. The firm remains optimistic about investment opportunities in leading cloud providers for 2026.
Key insights from CITIC SEC: **Report Background**: North American cloud providers have seen a sustained recovery in revenue growth. Since Q3 2025, leading U.S. cloud computing companies have shown clear revenue acceleration, with the industry entering a phase of faster growth. Looking ahead to 2026, strong cloud demand and AI-driven cloud expansion will remain key themes, supported by easing supply constraints in chips and data centers, which should improve order fulfillment.
**Growth Drivers**: AI computing power leasing is the primary growth driver. AI cloud has become a core engine for U.S. cloud market growth, though the business model remains dominated by basic computing power leasing. Leading providers and new entrants are focusing on deploying and leasing GPU/TPU resources, primarily serving large clients and profiting from chip supply and infrastructure services. Unlike the mature traditional cloud market, which differentiates through elastic scaling and PaaS toolchains, competition in AI cloud centers on flagship chip availability, cluster scale, and deployment efficiency.
**Supply-Demand Dynamics**: Demand is led by major AI model developers, with significant short-term resource constraints. OpenAI and Anthropic, for instance, have seen surging computing power needs, with OpenAI signing over $1.4 trillion in computing contracts this year. Amid supply shortages, model developers are adopting multi-cloud strategies to diversify risks and optimize costs, creating opportunities for providers with self-developed chips and cost advantages.
North America’s top four CSPs are expected to spend $406 billion in 2025 (up 61% YoY) and $517 billion in 2026 (up 27% YoY). As data centers come online, computing supply is projected to ease quarterly in 2026, boosting performance. Additionally, high-performance chips like Google’s TPU and AWS’s Trainium will supplement supply.
**Revenue Forecast**: Based on backlog analysis, 2026 revenue is expected to accelerate as data centers are delivered, improving supply constraints and stabilizing order fulfillment. Cloud providers' revenue is likely to remain strong in Q4 2025 and enter an accelerated growth phase in 2026.
**Risks**: Potential risks include slower-than-expected AI advancements, global IT spending slowdowns, delays in cloud provider R&D, underperformance in infrastructure scale effects, slow ecosystem development, talent attrition, geopolitical disruptions, regulatory tightening, and unmet expectations in capital expenditure control.
Comments