In 2023, Big Tech is expected to cut spending on cloud computing

Some Wall Street analysts predict a sharp decline in big technology companies’ investments in the warehouse-sized data centers filled with cutting-edge communications and computing equipment that make up the cloud in 2023. According to them, the growth of cloud spending could drop from a mid-20% range to a mid-single-digit range.

Mehdi Hosseini, an analyst at Susquehanna Financial, anticipates a 23% increase in major tech spending on cloud infrastructure in 2022. The growth is down a little from the 25% of the previous year. Hosseini predicts “flat to up to 5% year-over-year growth” for 2023.

In a report to clients, he stated, “We predict a digestion/slowdown in 2023.” According to us, the “calm” under the current cloud cover is comparable to the “calm” just before a hurricane hits the coast.