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Hello,
Thanks for your interest in our latest research. You can view a summary of our latest report below.
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Revenues for the webscale sector floundered in 2022, but the opposite happened in 2023. In 2023, global economic growth improved, the digital ad market recovered, TikTok began to face some backlash, cloud services penetration marched on, and Huawei's device business remained in the doldrums. All factors tended to benefit the revenue growth measured by our webscale tracker.
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Each quarter of 2023 saw an increase in the YoY growth rate, resulting in annual 2023 revenues of $2.237 trillion, up 6.2% from 2022. Revenues per employee in the webscale sector ended 2023 at $584K, from $539K in 2022; free cash flow per employee jumped even more noticeably, from $73K in 2022 to $109K in 2023. These swings are due both to rising revenues and even more quickly rising profits, and the sector's headcount growth taking a pause in the last two years.
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Total capex did fall a bit in 2023, down 5.1% to $192B. This doesn't imply a negative market sentiment. Capex spend by quarter can vary significantly due to supply chain and other issues, and the webscale market is especially volatile since it's driven by just a few big players; the top 4 capture 77% of global capex, after all. Moreover, the tech portion of capex actually grew in 2023, up 4% YoY.
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Looking beyond the 2023 numbers, what is most important is that last year the webscale market found a new lifeforce, a new reason for being...
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To see our most recently published reports, click here
Best regards,
Matt Walker
Chief Analyst
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