Recent findings from IDC highlight the transformative potential of edge computing in leveraging real-time data and artificial intelligence (AI) for business investments. This shift is particularly relevant for sectors investing in AI-accelerated processors, multi-access edge computing (MEC), content delivery networks (CDNs), and virtual network functions (VNFs).
Projected Growth in Edge Computing Spending
According to IDC’s Worldwide Edge Computing Spending Guide, enterprise and service provider expenditures are expected to rise significantly from 2025 to 2028 across various technology markets, encompassing 22 sectors, seven technology domains, and spanning multiple industries and regions, including Australia, Brazil, Canada, Germany, India, Japan, and the US. The study analyzed 1,000 enterprise use cases focused on domains such as AI, the Internet of Things (IoT), augmented reality (AR), virtual reality (VR), drones, and robotics.
Investment Figures and Trends
The report anticipates that global spending on edge computing services will reach approximately $261 billion in 2025, with a compound annual growth rate (CAGR) of 13.8%, potentially hitting $380 billion by 2028. At the outset of 2025, hardware is forecasted to be the primary investment area, primarily fueled by the demand for AI-accelerated processors and the need for real-time data processing capabilities across intelligent endpoints.
However, the segment for aggregated services—including provisioned and professional services—is expected to exceed hardware investments by 2028, demonstrating a CAGR of over 18%. Among provisioned services, Infrastructure as a Service (IaaS) is projected to lead in growth, driven by the need for scalable and cost-effective solutions to support increasing AI workload demands. Service providers are anticipated to invest nearly $100 billion in infrastructure for MEC, CDNs, and VNFs by 2028.
Sector-Specific Insights
Looking at specific sectors, the retail and services industry is likely to represent the largest share of edge service investments in 2025, accounting for nearly 28% of overall global expenditure. Key use cases such as video analytics and optimized operations are prevalent within this sector. Following closely is the manufacturing and resources sector, which is expected to contribute a quarter of worldwide spending. Financial services are on track to see the most accelerated growth over the next five years, driven by the need for enhanced fraud analysis through AI.
Geographic Spending Landscape
Geographically, North America is projected to remain the leader in edge computing expenditures, followed by Western Europe and China. Notably, Western Europe, China, and Latin America are set to witness the highest growth rates during the forecast period.
Expert Commentary
Dave McCarthy, research vice-president of cloud and edge services at IDC, commented on the emerging trends, stating that edge computing is key to transforming how businesses utilize real-time data. He emphasized the necessity for industry-specific solutions that meet distinct operational needs, highlighting ongoing investments in low-latency networks, AI-driven edge analytics, and collaborative ventures to provide secure infrastructure.
McCarthy concluded that these advancements are essential for unlocking the full potential of edge computing, facilitating innovations across various sectors from smart manufacturing to responsive healthcare systems.