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The global external enterprise storage systems market returned to growth in 2025, reaching a record $33 billion, backed by increased AI demand, flash technology, and supply chain shifts, with continued expansion forecasted for 2026.
The global market for external enterprise storage systems returned to growth in 2025, reaching a record $33.0 billion in annual vendor revenue as companies resumed postponed infrastructure upgrades and adjusted procurement strategies, according to IDC. Vendor spending in the fourth quarter of 2025 alone reached $9.7 billion, reflecting broad demand across product segments and geographies even as the server market expanded at a faster pace. According to IDC, accelerating projects tied to artificial intelligence helped spur demand for higher-performance storage. [2],[3]
Flash-based systems led the recovery, with all-flash arrays posting the strongest quarterly expansion as enterprises prioritised low-latency, high-throughput capacity for AI training and inference workloads. IDC data show all-flash revenue grew steeply year-on-year, while hybrid flash arrays contracted and hard disk drive arrays , unexpectedly , reversed earlier declines to register a modest increase, illustrating a complex shift in buyer preferences. Industry trackers noted that component shortages and capacity pressures raised the effective price per gigabyte, contributing to a rise in storage-related spending. [2],[3]
By price band, midrange systems accounted for the lion’s share of the market’s growth, representing around two-thirds of external storage revenue as organisations sought cost-effective ways to refresh infrastructure. High-end systems also expanded, though entry-level units fell, suggesting that enterprise customers favoured larger, more capable platforms over smaller deployments. IDC’s forecasts cited in its market tracker anticipate the recovery that began in 2025 to continue into 2026 as demand for enterprise storage stabilises. [2],[7]
Regional performance was broad-based, with China and the United States leading gains. China posted the strongest growth, followed by the US, while Europe, the Middle East and Africa, and Latin America expanded at more modest rates. Japan saw only marginal growth, and some Asia-Pacific markets outside China, along with Canada, recorded slight declines, reflecting differing investment cycles and macroeconomic headwinds across markets. IDC and related industry reports warned that slow global growth and geopolitical tensions remain risks that could temper momentum. [1],[2]
Vendor rankings showed established incumbents retaining the largest shares. Dell Technologies held the top position with nearly a quarter of the market, followed by Huawei and NetApp, with IBM and a fourth-ranked vendor also among the leaders. Several vendors benefited from strong all-flash sales, while others recorded double-digit quarterly growth in specific regions. Market analysts emphasised that vendor performance continues to be shaped by regional strengths, product mix and go-to-market strategies. [1],[3]
Component supply dynamics altered buying behaviour during the year. Fluctuating prices for solid-state drives, hard disk drives and DRAM led some buyers to accelerate orders to lock in shipments, while others blended HDD-based capacity with flash tiers to manage costs. “Storage demand would navigate between a continued increase on components prices and the growing infrastructure refreshing needs from companies of all sizes, we might see a positive 2026 for the market with end users trying to balance their CAPEX between hardware, software, management efficiency and as a service models in order to meet their needs,” said Juan Seminara, research director for worldwide enterprise infrastructure trackers. [1],[2]
Taken together, the data depict a resilient but evolving enterprise storage market: technology transitions toward flash and AI-supportive architectures are raising average selling prices and reshaping procurement, even as geopolitical and macroeconomic uncertainties pose downside risks to future growth. IDC’s tracker and industry observers expect the sector to build on 2025’s recovery into 2026, provided component markets stabilise and large-scale AI projects continue to drive demand for higher-performance external storage. [2],[4]
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Source: Fuse Wire Services
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