The Saudi Arabia ICT market driven by Vision 2030 digital transformation initiatives, nationwide 5G rollout, smart-city investments, cloud localization mandates, and rapidly accelerating enterprise AI adoption across government and private sector organizations. Saudi Arabia ICT market size increased from USD 45.74 Billion in 2025 to USD 48.05 Billion in 2026 and is projected to reach USD 72.20 Billion by 2034, exhibiting a CAGR of 5.04% during 2026-2034. Hardware currently dominates the type mix, accounting for a leading share of overall spend, while Small and Medium Enterprises represent the largest share within the size-of-enterprise segment, reflecting the Kingdom’s push to digitize its broader business base beyond large conglomerates and state entities.
How AI is Reshaping the Future of Saudi Arabia ICT Market?
- The Saudi Cabinet officially designated a recent year as the Year of Artificial Intelligence, marking a shift in national priority under which over 664 specialized AI companies now actively drive the local technology ecosystem.
- Saudi Arabia is powering its ICT growth through massive AI infrastructure builds under the National Data Center Strategy, targeting 1.5 gigawatts of capacity, backed by partnerships with global chipmakers and local AI champion HUMAIN to create smart AI factories across NEOM.
- Saudi enterprises are accelerating AI-powered IT operations and hybrid multi-cloud strategies, enabling predictive maintenance and intelligent automation across critical infrastructure spanning energy, finance, and telecommunications.
- Groundbreaking took place on a USD 2.7 Billion data center in Riyadh, featuring 480 MW of capacity and over 30 million square feet of built space, positioned as one of the largest government-backed data centers under the National Data Center Strategy.
- Saudi Telecom Company’s digital infrastructure arm entered a joint venture with HUMAIN to build AI-focused data centers with capacity scaling up to 1 gigawatt, starting with an initial 250 megawatt phase, reflecting the scale of capital now flowing into AI-ready ICT infrastructure.
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Saudi Arabia ICT Market Trends and Drivers
The Saudi Arabia ICT market is undergoing rapid transformation, driven by the dual momentum of government-led digital policy and expanding private sector technology adoption. Government spending on ICT in the Kingdom increased sharply compared to the prior year, reaching SR 41.87 Billion, equivalent to approximately USD 11.16 Billion, underscoring the scale of public investment flowing into digital infrastructure, e-government platforms, and national data systems. Cloud adoption is accelerating in parallel, with issuance of cloud computing permits by the Ministry of Commerce surging 40% year over year to reach 1,759 permits within a single quarter, reflecting the pace at which enterprises are shifting workloads to localized cloud environments in compliance with Saudi data residency requirements.
Smart city development and broader digital transformation initiatives continue to drive demand for advanced ICT solutions, including Internet of Things platforms and AI-enabled analytics embedded within government and enterprise systems. The deployment of 5G networks is redefining connectivity across the Kingdom, enabling faster data transfer and unlocking new industrial applications in manufacturing, logistics, and energy. Heightened emphasis on cybersecurity is inducing companies across BFSI, government, and telecom verticals to invest in secure architectures that protect confidential data and critical digital infrastructure, a priority reinforced by the Kingdom’s growing role as a regional financial and technology hub.
AI infrastructure investment stands out as the single most transformative driver reshaping the market’s growth trajectory. HUMAIN, an AI venture backed by the Public Investment Fund, is targeting delivery of 6.6 gigawatts of data center capacity over the coming decade, while its telecom sector joint venture with Center3 alone is designed to reach up to 1 gigawatt of AI workload capacity. These investments align directly with the National Strategy for Data and AI, which aims to position the Kingdom among the top 10 countries globally in the open data index and among the top 20 countries in peer-reviewed data and AI publications. The Kingdom’s role as a regional technology hub is simultaneously attracting global technology players seeking partnerships with local companies, reinforcing a competitive landscape defined by rapid innovation and digital inclusion.
Saudi Arabia ICT Industry Segmentation
The report has segmented the market into the following categories:
Analysis by Type:
- Hardware
- Software
- IT Services
- Telecommunication Services
Hardware commands the largest share of the type segment, driven by continued investment in servers, networking equipment, and data center infrastructure required to support the Kingdom’s expanding cloud and AI computing capacity, alongside sustained government procurement of computing equipment for e-government and smart-city platforms.
Analysis by Size of Enterprise:
- Small and Medium Enterprises
- Large Enterprises
Small and Medium Enterprises lead the size-of-enterprise segment, supported by government-backed digitalization programs that provide funding, training, and cloud subsidy schemes to help smaller businesses adopt point-of-sale systems, e-commerce platforms, and cloud-based accounting and enterprise resource planning tools.
Analysis by Industry Vertical:
- BFSI
- IT and Telecom
- Government
- Retail and E-Commerce
- Manufacturing
- Energy and Utilities
- Others
The government vertical holds a substantial share of industry vertical spend, driven by large-scale investment in e-government platforms, national data infrastructure, and AI-enabled public service delivery systems that form a central pillar of the Kingdom’s broader Vision 2030 digital transformation agenda.
Regional Insights:
- Northern and Central Region
- Western Region
- Eastern Region
- Southern Region
The Northern and Central Region commands a dominant regional share, reflecting Riyadh’s role as the national digital, financial, and government ICT hub, home to major data center developments, telecom headquarters, and the bulk of enterprise technology spend concentrated in the capital’s expanding business districts.
Recent News and Developments in Saudi Arabia ICT Market
- February 2026: Groundbreaking took place on the USD 2.7 Billion Hexagon Data Centre in Riyadh, featuring 480 MW of capacity and over 30 million square feet of built space, positioned as the world’s largest government data center under the National Data Center Strategy.
- January 2026: Saudi enterprises continued accelerating AI-powered IT operations and hybrid multi-cloud strategies, enabling predictive maintenance and intelligent automation across critical national infrastructure.
- December 2025: Saudi Telecom Company’s digital infrastructure subsidiary Center3 signed a memorandum of understanding with HUMAIN to establish a joint venture developing AI-focused data centers with up to 1 gigawatt of capacity, starting with an initial 250 megawatt phase, with HUMAIN holding a 51% stake and stc holding the remaining 49%.
- December 2025: Technology firm INFINIARC signed a memorandum of understanding with a global chipmaker to advance AI computing capabilities within Saudi Arabia, reinforcing the Kingdom’s push to build domestic AI compute capacity.
- October 2025: Saudi Telecom Company and HUMAIN signed a connectivity deal to establish advanced connectivity services supporting HUMAIN’s mission to position Saudi Arabia as a global hub for artificial intelligence.
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