Bare Metal Cloud Market to Reach US$ 66.95 Billion by 2033, Growing at 24.7% CAGR Driven by AI, HPC, and GPU-Dense Workloads

Market Overview:

The Global Bare Metal Cloud Market reached US$ 11.62 billion in 2025 and is expected to reach US$ 66.95 billion by 2033, growing at a CAGR of 24.7% during the forecast period 2026-2033. The market is witnessing rapid growth as organizations increasingly run AI, machine learning, and high-performance computing workloads that demand direct access to GPUs and high-performance hardware. Bare metal servers provide this access without the performance overhead of virtualization, resulting in higher speed, consistency, and cost efficiency for compute-intensive tasks.

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Major cloud providers and hyperscalers have recognized this trend. Companies like Oracle have integrated bare metal infrastructure into their AI strategies, deploying dedicated GPU clusters and large-scale AI superclusters in collaboration with NVIDIA. Across the industry, there is a growing focus on GPU-dense bare metal systems to support massive AI models and other demanding compute workloads.

Market Dynamics:

Growth in Adoption of AI/ML and High-Performance Compute (GPU)
The rising demand for AI model training and inference is driving the adoption of bare-metal cloud solutions. Training large language models and running complex AI simulations require direct access to GPUs, multi-core CPUs, and high-throughput, low-latency networking, which bare-metal infrastructure provides without virtualization overhead.

Hyperscalers and cloud providers are increasingly offering GPU-dense bare-metal clusters to meet these requirements. For instance, NVIDIA H100 and A100 GPUs are widely deployed in bare-metal AI training environments, as organizations seek hardware-level consistency and to avoid the "noisy neighbor" effects common in virtualized environments. Leading cloud providers have expanded their bare-metal AI infrastructure offerings: Oracle Cloud Infrastructure promotes bare-metal GPU clusters for large-scale AI training, while AWS provides EC2 bare-metal instances for customers needing direct hardware control.

Vendor Consolidation & Service Viability Concerns
The bare-metal cloud market faces uncertainty due to vendor consolidation and policy changes. Establishing and operating bare-metal infrastructure requires substantial capital investment, including hardware refresh cycles, data center expansion, and managing the complex supply chain for high-end GPUs and servers. Some vendors have reshuffled offerings or exited specific segments, raising concerns among enterprise buyers about the long-term viability and continuity of services and platforms.

Recent Key Developments - United States

✅ April 2025: Amazon Web Services (AWS) introduced new EC2 I7ie bare metal instance sizes powered by 5th‐generation Intel Xeon Scalable processors, delivering significantly improved compute performance, storage, and networking capabilities for high‐performance and latency‐sensitive workloads.

✅ July-September 2025: AWS expanded bare metal support for Amazon RDS for Oracle, enabling bare metal instances for Oracle databases with pricing optimized compared with virtualized offerings, improving cost‐effectiveness for enterprise database hosting.

✅ April 2025: OpenMetal announced the general availability of private GPU servers and GPU clusters featuring NVIDIA A100 and H100 GPUs, providing dedicated bare metal infrastructure for artificial intelligence, machine learning, and high‐performance computing workloads.

✅ December 2025: Oracle launched new A4 Bare Metal cloud instances powered by AmpereOne M ARM processors, offering up to 192 cores optimized for compute‐intensive enterprise applications and enhancing bare metal infrastructure options for U.S. customers.

Recent Key Developments - Global

✅ June 2025: Oracle and AMD collaborated to bring AMD Instinct MI355X GPUs to Oracle Cloud Infrastructure (OCI), enabling deployment of zettascale AI superclusters with up to 131,072 GPUs to support large-scale AI training and inference workloads built on bare-metal architecture.

✅ October 2025: Hammerspace demonstrated breakthrough GPU storage performance on bare-metal GPU clusters, optimizing ultra-fast shared storage to reduce bottlenecks, improve GPU utilization, and accelerate AI training, inference, and checkpointing workflows on OCI bare-metal infrastructure.

✅ February 2025: Oracle Cloud Infrastructure announced general availability of Red Hat OpenShift support on bare-metal instances, including NVIDIA-accelerated GPU shapes (A100 and H100), enabling enterprise AI applications and containerized workloads on dedicated hardware.

✅ April 2025: OpenMetal launched GPU servers and clusters featuring NVIDIA H100 and A100 GPUs for private cloud AI and HPC workloads, expanding bare-metal offerings tailored to high-performance compute use cases.

M&A / Strategic Activity:

IBM acquires StrongDM for undisclosed amount - IBM acquired StrongDM, a provider of secure access and infrastructure management tools. This acquisition strengthens IBM's hybrid cloud and bare-metal infrastructure security capabilities, enabling enhanced managed services for enterprise bare-metal deployments.

Equinix acquires Packet for undisclosed amount - Equinix acquired Packet, a bare-metal cloud provider, to accelerate its edge and bare-metal infrastructure offerings globally. The deal allows seamless integration of bare-metal compute across colocation and interconnection platforms.

DigitalOcean acquires ServerCentral for undisclosed amount - DigitalOcean acquired ServerCentral, a global managed bare-metal and hybrid hosting provider, expanding its infrastructure footprint and bare-metal cloud services for high-performance and enterprise workloads.

Hewlett Packard Enterprise (HPE) acquires Zerto for undisclosed amount - HPE acquired Zerto to enhance its bare-metal cloud disaster recovery and data protection portfolio. The acquisition enables tighter integration of bare-metal compute with enterprise continuity and backup solutions.

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Key Players:

Oracle, IBM, Lumen Technologies, OVH SAS, Sparkoo Technologies Ireland Co. Limited, Pure Storage, Inc., Limestone Networks, Inc., Rackspace Technology, SAMSUNG SDS INDIA, Scaleway SAS, Zenlayer. Worldstream, Latitude.sh, Google Cloud, Hivelocity, Inc, phoenixNAP, VULTR, Liquid Web, LLC and Rackspace Technology.

Market Segmentation:

By Type
The market is segmented into Bare Metal Servers, Bare Metal Instances, Bare Metal as a Service (BaaS), Storage-Optimized Bare Metal, and Network-Optimized Bare Metal, with Bare Metal Servers dominating due to high adoption for AI/ML workloads, HPC, and enterprise-critical applications. Storage-optimized and network-optimized bare-metal servers are growing as enterprises require high I/O throughput and low-latency, high-bandwidth networking.

By Organization Size
End-users are segmented into Large Enterprises and Small & Medium Enterprises (SMEs). Large enterprises dominate the market, leveraging bare-metal infrastructure for high-performance computing, AI workloads, and mission-critical applications. SMEs are increasingly adopting bare-metal solutions for cost-effective, scalable IT infrastructure to support analytics, web hosting, and business applications.

By Deployment Mode
The market is divided into Public Bare Metal Cloud, Private Bare Metal Cloud, and Hybrid Bare Metal Cloud. Public bare-metal adoption is rising due to scalability and flexibility, while private bare-metal clouds dominate among enterprises requiring security, compliance, and dedicated infrastructure. Hybrid deployments are growing as organizations balance cost efficiency with performance and security.

By Application
Applications include High-Performance Computing (HPC), Big Data & Analytics, AI / Machine Learning, Gaming & Media, Enterprise & Core IT, and Infrastructure. HPC and AI/ML workloads dominate due to their compute-intensive nature. Storage and network-optimized bare-metal deployments support analytics, gaming, media, and enterprise IT infrastructure.

By End-User
End-users comprise:
Information Technology & Telecom
BFSI (Banking, Financial Services & Insurance)
Healthcare & Life Sciences
Media & Entertainment
Retail & E-Commerce
Automotive & Transportation
Government & Public Sector
Education & Research
Energy & Utilities
Manufacturing

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Regional Insights:

North America - 35% Share
North America leads the market, driven by early adoption of bare-metal cloud infrastructure, strong presence of major hyperscalers (AWS, Oracle, IBM, Google Cloud), and robust data center and network infrastructure. Enterprises in IT, BFSI, healthcare, and media sectors dominate adoption due to high-performance computing, AI/ML workloads, and compliance requirements. Government initiatives and advanced R&D further accelerate regional growth.

Europe - 25% Share
Europe holds around 25% of the market, supported by stringent data privacy and cybersecurity regulations, adoption of Industry 4.0 initiatives, and the presence of major manufacturing and IT hubs in Germany, France, and the UK. Private and hybrid bare-metal clouds are increasingly preferred by enterprises requiring data sovereignty and low-latency infrastructure.

Asia Pacific - 25% Share
Asia Pacific accounts for 25% of the market, driven by rapid industrial automation, AI adoption, smart factories, and digital transformation initiatives in China, Japan, India, South Korea, and Singapore. Discrete and process industries both adopt bare-metal infrastructure for HPC, AI, big data analytics, and gaming workloads. Government programs supporting industrial IoT and cloud adoption further accelerate regional growth.

FAQ's
1. What is the current size of the global bare metal cloud market?
The global bare metal cloud market was valued at US$11.62 billion in 2025 and is projected to reach US$66.95 billion by 2033, growing at a CAGR of 24.7% due to rising AI, machine learning, and high-performance computing workloads.

2. What is driving growth in the bare metal cloud market?
Key growth drivers include increasing adoption of AI/ML, GPU-intensive workloads, high-performance computing, real-time analytics, and compliance-critical applications, where enterprises require direct hardware access, predictable networking, and low virtualization overhead.

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