UBS projects that 73% of hyperscale cloud service providers' capital expenditures will go to storage in 2027, totaling roughly $761.3 billion.

UBS stated that driven by surging demand from AI GPU manufacturers and hyperscale cloud service providers, coupled with rising average selling prices (ASPs) of storage products, storage spending is growing rapidly. It projects that by 2027, total capital expenditure (CapEx) of the world’s top 11 hyperscale cloud service providers will reach $1.0403 trillion, with storage spending accounting for $761.3 billion, a share rising to 73%. Total CapEx of hyperscale cloud service providers will jump from $504 billion in 2025 to $873.9 billion in 2026, and further to $1.0403 trillion in 2027. Over the same period, storage spending will increase from $72.8 billion to $335.7 billion and $761.3 billion, representing year-on-year growth of 361% in 2026 and 127% in 2027 respectively. By product type: spending on HBM is projected to rise from $24 billion in 2025 to $144.4 billion in 2027, with its blended average selling price climbing from $1.52 per Gb to $2.77 per Gb; DDR spending will grow from $30.2 billion to $448.9 billion, with average price per Gb surging from $0.43 to $2.30; NAND spending will increase from $18.7 billion to $168.1 billion, with average price per GB rising from $0.07 to $0.27. UBS noted that to meet the growth in spending and demand, storage manufacturers must expand production capacity, but constraints including fab space, equipment delivery lead times and manpower loads remain significant bottlenecks.