Data Center Interconnect Market Revenue to Attain USD 64.96 Bn by 2035

Published: 17 Mar 2026

Author: Precedence Research

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Data Center Interconnect Market Revenue and Trends 2026 to 2035

The global data center interconnect market revenue reached USD 16.31 billion in 2025 and is predicted to attain around USD 64.96 billion by 2035 with a CAGR of 14.82%. This market is experiencing unprecedented growth, driven by the rapid pace of digital transformation, the rise in global data traffic, and increasing storage demand.

What Factors Contribute to the Growth of the Data Center Interconnect Market?

The increasing adoption of cloud-based solutions (SaaS, IaaS), rapid expansion of edge computing, and the rise of hyperscale data centers are major factors contributing to the overall growth of the market. Artificial Intelligence (AI) and Machine Learning (ML) infrastructure necessitates substantial data transmission between data centers, which propels the need for high-bandwidth interconnects. Moreover, the rising need for high-speed, low-latency connectivity to support cloud computing, big data traffic, and the growing demand for scalable data center networks drives the market.

Segment Insights

• By component, the hardware segment held a dominant market share in 2025, driven by the expansion of hyperscale data center fabrics as cloud providers procure large volumes of switches, routers, and high-fiber-count cabling. Additionally, sustainability initiatives are accelerating the adoption of energy-efficient hardware solutions, such as co-packaged optics and photonic switching, which reduce power consumption per bit and minimize data center footprints.
• By connectivity type, the short-haul segment contributed the biggest market share in 2025. The segment’s dominance is primarily driven by the rising need for dense and high-bandwidth short-haul fabrics to manage the exponential increase in east-west traffic required for AI clustering.
• By application, the disaster recovery and business continuity segment registered its dominance in 2025, driven by the growing reliance on high-speed data center interconnect (DCI) solutions for real-time data synchronization. Robust disaster recovery frameworks have become essential for maintaining digital trust and enabling organizations to scale operations confidently amid uncertain and volatile conditions.
• By end-user industry, the communication service providers (CSPs) segment accounted for the majority of the market share in 2025, supported by the increasing demand for low-latency, high-capacity network architectures capable of handling unprecedented data traffic and supporting next-generation digital services.

Regional Insights

North America dominated the global data center interconnect market in 2025. The region is home to the major tech players such as Ciena Corporation, Cisco Systems, Inc., Juniper Networks, Inc., Arista Networks, Inc., Infinera Corporation, Extreme Networks, Inc., Equinix, Inc., and Adtran Networks. The region's dominance is primarily driven by its well-established cloud computing ecosystem, growing demand for high-speed and secure networking technologies, stringent sustainability norms, rise of hyperscale data centers, increasing focus on network upgrades, and explosive Artificial Intelligence (AI) and Machine Learning (ML) workloads.

On the other hand, Asia Pacific is a rapidly growing region in the market. The growth of the region is attributed to the rapid digitalization of businesses, the rising shift towards cloud-based solutions (SaaS), growing demand for high-density AI workloads, increasing hyperscale expansion, and significant investment in sustainable infrastructure. Moreover, the significant surge in IoT, AI, and cloud computing (hybrid/multi-cloud) requires high-speed data transfer between dispersed data centers, driving the market’s growth in the region.

Data Center Interconnect Market Report Coverage

Recent Development

• In December 2025, Marvell Technology, Inc., a leader in data infrastructure semiconductor solutions, announced it had entered into a definitive agreement to acquire Celestial AI, a pioneer of a disruptive Photonic Fabric technology platform purpose-built for scale-up optical interconnect. This strategic acquisition represents a transformational milestone in accelerating the company’s connectivity strategy for next-generation AI and cloud data centers. (Source: https://investor.marvell.com)

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