The cloud industry is entering a stage of hypergrowth driven by generative AI, hybrid and multi-cloud adoption, and global data acceleration. In 2025, global cloud infrastructure (IaaS) spending reached $90.9 billion in Q1 2025 alone—a 21% year-over-year increase, according to Omdia.
Overall, the global cloud computing market (including IaaS, PaaS, and SaaS) is now valued at approximately $943 billion in 2025 and is on track to surpass $1 trillion in early 2026.
Continued accelerating trends include hybrid and multi-cloud strategies, increased focus on cloud security and compliance, growth of edge computing, advancements in AI and machine learning integration, and the development of serverless computing.
Here, experts share their predictions for cloud in 2026:
Hybrid AI Becomes the New Default: The ‘cloud-everything’ era is coming to an end. Data gravity, sovereignty laws, and inference cost control are drivers for on-premises and model-to-data architectures. Enterprises are realizing that critical AI workloads need to remain close to their data, whether on-premises or in hybrid environments, to meet stringent requirements for performance, compliance, and data sovereignty. As a result, DevOps and data teams will increasingly build intelligent, governed ‘AI factories’ inside the enterprise, integrating AI pipelines directly with existing systems rather than relying solely on public cloud services. This approach ensures organizations can scale AI responsibly while maintaining control over sensitive information and operational efficiency.—Justin Borgman, CEO and co-founder, Starburst
Cloud-first strategies: With the rise of cloud-first strategies, enterprises will reshape how they approach communication infrastructure in 2026. As enterprises move away from legacy on-premises systems, the emphasis will be on shifting toward scalable, agile, and globally deployable cloud environments that support hybrid and remote workforces. This evolution enables faster deployment, simplified management, and seamless integration across collaboration ecosystems, allowing organizations to future-proof operations while delivering a more connected customer experience.—David Fischer, chief sales officer at Luware
Multi-cloud and hybrid will become a strategic architecture, not a choice: “Most enterprise clients are already using more than one hyperscaler, driven by a deliberate strategy to avoid vendor lock-in and negotiate discounted rates on bulk service mapping. In 2026, multi-cloud and hybrid environments will become architectural necessities. Organizations will strategically place critical components in the public cloud for scalability and high availability, use private cloud for data security and cheaper hardware for AI initiatives, and rely on specialized clouds for AI and compliance workloads. This diversification will define cloud strategy through the next year.—Rohan Gupta, VP, cloud, security and DevOps at R Systems
Regulatory pressure forces true multi-cloud: Financial services regulators' concerns about cloud concentration risk will cascade across industries in 2026. Organizations will shift from multi-cloud in theory to multi-cloud in practice, moving beyond multiple isolated environments to truly portable, active-active deployments. Database platforms that enable seamless application failover between both cloud regions and/or cloud providers, such as pgEdge Distributed Postgres, will see accelerated adoption as insurance against provider-specific outages.—Phillip Merrick, co-founder, chief product officer and chairman, pgEdge
End-to-end observability becomes a must-have rather than a value-add: Unified, correlated observability across cloud, on-prem, and edge networks will become mandatory for MSPs. As networks get more complex and distributed, unified discovery, contextual correlation, and automated remediation will be the capabilities that drive reliable, efficient, and resilient operations.—Steve Petryschuk, director, product and market strategy at Auvik
Outages drive the industry toward a shadow cloud future: As hyperscaler outages continue to make headlines, organizations are losing patience with “all-in-one” cloud dependency. 2026 will accelerate a shift toward smaller, regional clouds and multi-cloud strategies. Organizations will also start relying on secondary, lesser-known cloud providers as hidden backups, creating a “shadow cloud” layer. Hyperscalers will feel the pressure, scrambling to reassure customers with aggressive marketing campaigns, new reliability guarantees, and promises of ironclad SLAs—Catalin Voicu, cloud solutions engineer at N2W (formerly N2WS)
Kubernetes and Cloud Optimization Go Mainstream: Automated Kubernetes optimization will hit majority adoption, moving cost management and performance tuning out of ineffective manual processes. This trend toward continuous optimization will expand beyond Kubernetes to data warehouses and other high growth workloads, fueled in part by AI-driven usage growth.—Kyle Campos, chief technology and product officer at CloudBolt
Cloud costs and arch complexity will continue to stall adoption: Whichever way we look at AI, it’s costly. If companies stay in the cloud, it’s expensive to run complex AI projects there. It’s also prohibitively expensive to migrate infrastructure back in-house unless organizations are certain it’s the right strategy (i.e. when it’s cheaper to have on-prem control than to operate in the cloud). The uncertainty around selecting the right technical framework, coupled with heavy potential costs, will slow adoption. What we are sure of is that companies want to push the boundaries of AI and get there quicker than their competitors, and so they will look to iterate quickly, and learn first from their cloud providers, before committing to a long-term strategy.—Tobie Morgan Hitchcock, CEO and co-founder, SurrealDB
Composable, zero-copy architectures will become the new standard: Enterprises are rejecting data duplication and vendor lock-in. Future CDPs will integrate directly with lakehouse and cloud ecosystems, letting brands bring their own compute, storage, and models—with full control and interoperability.—Amperity CTO and co-founder, Derek Slager