Samsung SDS, the IT services arm of Samsung, is set to build its first AI data center in South Korea. The company has acquired land and infrastructure at its Gumi plant, reportedly for around $15 million. This new data center will complement Samsung SDS’s growing portfolio, which includes 18 data centers worldwide, five of which are located in South Korea.

This move comes amid skyrocketing global demand for AI computing power. Companies across various industries are ramping up adoption of AI technology. Research from IDC forecasts that AI workloads will drive a sharp increase in data center capacity, with a projected compound annual growth rate (CAGR) of 40.5% by 2027.

In response to this growing demand, Samsung SDS has been heavily investing in data center infrastructure. Its cloud services division saw a 35% year-over-year revenue growth in Q3 2024, underscoring the expanding importance of AI and cloud services in the company’s strategy.

Additionally, Samsung has appointed Lee June-Hee as CEO of Samsung SDS. Lee has a strong background in networking and 5G, having previously led Samsung’s Galaxy series smartphone adoption of 5G. His leadership will focus on further accelerating AI and cloud infrastructure investments.

Recently, Samsung SDS launched its FabriX AI service in partnership with Microsoft Azure. This service aims to help the company expand its global user base, signaling a significant step in its AI cloud growth.

The AI data center is expected to play a crucial role in helping Samsung achieve its $1 billion annual revenue target from cloud services. By investing in AI infrastructure, Samsung aims to meet the increasing demand for AI compute, positioning itself as a key player in the competitive cloud market.

TECHRADAR