Massimo Bandinelli, Marketing Manager at Aruba Cloud, explores how sovereignty, sustainability and AI‑powered innovation are converging to reshape Europe’s multi‑cloud landscape – and why businesses that stay agile will seize the advantage.

Several key trends will shape the direction of cloud computing as we soar through 2025. After reaching $80.8 billion in 2024, the European cloud computing market is projected to grow at a compound annual growth rate of 17.1% between 2025 and 2034.

These trends are fuelled by the rise of AI, evolving regulatory frameworks, and a strong focus on data sovereignty as businesses are seeking greater efficiency, resilience, and technological advancement. From sovereign cloud advancements to sustainability movements and AI-driven breakthroughs, companies must adapt to remain competitive. 

With a growing reliance on hybrid and multi-cloud solutions, 73% of companies are now investing in hybrid cloud and 16% adopting diverse cloud models. So, here’s a closer look at the major developments shaping the cloud industry in the coming year…

Cloud diversification: a flexible approach

To meet complex business needs and avoid vendor dependency, organisations are turning to multi-cloud architectures. 

In 2023, hybrid cloud accounted for 31% of IT budgets in Europe and IT leaders expect their budget to increase to 48% over the next two years. This approach allows companies to distribute workloads across multiple providers, optimising performance and security while mitigating the risks of being locked into a single ecosystem. For example, organisations can use a private cloud for storing sensitive data, benefiting from stricter security measures, while leveraging the public cloud for less sensitive workloads to reduce costs.

At the same time, a growing number of businesses are rethinking their cloud strategies and repatriating workloads from the public cloud back to private cloud platforms or on-premise solutions. As this trend of cloud repatriation gains momentum, hybrid cloud adoption is further reinforced, offering companies the flexibility to balance public and private cloud advantages while maintaining greater control over their infrastructure.

One of the most direct effects of vendor lock-in is the unpredictability of cloud costs. When businesses rely on a single provider, they may face unexpected price hikes, making long-term financial planning difficult and potentially harming overall business stability. By adopting open-source or standardised platforms, companies can mitigate these risks, ensuring they have the freedom to choose a vendor that offers the best balance between performance, flexibility, and predictable costs.

As businesses prioritise agility, 2025 will see a continued move away from proprietary platforms in favour of adaptable, provider-agnostic cloud solutions. The ability to switch between cloud environments based on performance, cost, and compliance requirements will be critical for organisations looking to maintain a competitive edge.

AI’s expanding role in cloud evolution

It’s no secret that AI, reinforced by this new wave of agentic AI, is becoming a central force in business innovation. In 2024, 41% of European organisations incorporated AI into their strategies, increasing the demand for robust cloud infrastructure that can handle machine learning and high-performance computing workloads.

Cloud platforms provide the necessary scalability and computing power to support AI-driven applications, enabling companies to leverage automation, predictive analytics, and enhanced decision-making capabilities. Therefore, as AI adoption grows, cloud environments will play a crucial role in enabling companies to unlock its full potential.

Strengthening data sovereignty

A top priority for European businesses is data sovereignty. With regulations like GDPR enforcing stringent data protection measures, organisations are increasingly opting for sovereign cloud solutions to ensure their data remains within national and EU borders.

Trust and transparency in cloud services are becoming differentiators, making sovereignty a strategic advantage in an era of growing digital regulation. Sovereign cloud frameworks offer organisations full control over their data, reducing risks related to foreign access, breaches, and non-compliance.

Sustainability as a core priority

With environmental responsibility becoming a corporate imperative, cloud providers are expected to integrate more sustainable practices into their operations. 85% of companies have ramped up their sustainability investments, making green cloud initiatives a significant factor in vendor selection.

One key innovation is the shift toward energy-efficient cooling solutions, such as liquid cooling, which drastically reduces power consumption compared to traditional air cooling. Cloud providers prioritising sustainability will be the preferred choice for businesses committed to reducing their carbon footprint and achieving environmental goals.

Furthermore, major cloud operators are investing in renewable energy sources, such as wind and solar power, to run their data centres more sustainably. Companies adopting cloud solutions are also exploring carbon offset programs and circular economy principles to extend hardware lifecycles and minimise waste. Energy-efficient and trustworthy edge and cloud infrastructures will be fundamental for sustainable use of these technologies.

The strategic path to cloud maturity

As businesses move towards achieving greater cloud maturity, this represents a fundamental shift in how businesses are leveraging technology today. It’s no longer about implementing simple infrastructure, it’s about comprehensively integrating cloud capabilities into core operational and strategic functions.

In essence, it’s about transforming the organisation to fully capitalise on the cloud’s dynamic nature and its potential to drive innovation and efficiency. To achieve this, companies are enhancing their internal expertise, implementing more efficient practices, and optimising cloud asset management to achieve seamless integration into their digital ecosystems.

Ultimately, the journey towards cloud maturity is one of continuous innovation and adaptability. In an increasingly cloud-dependent world, businesses that embrace emerging technologies, foster a culture of experimentation, and prioritise data-driven decision-making will be best positioned for success. They understand that the cloud is not just a technology, but a platform for innovation, enabling them to create new products and services, improve customer experiences, and gain a competitive advantage. This requires a mindset shift, where organisations are willing to embrace change, experiment with new ideas, and continuously adapt to the evolving landscape of cloud technology.

Looking ahead

As cloud investments continue to rise, the European market is on track for further expansion. In fact, 85% of businesses are expected to have a cloud-first strategy this year.

Data sovereignty will remain pivotal for compliance and trust, multi-cloud strategies will offer enhanced flexibility, and AI will drive new levels of innovation. Meanwhile, sustainability commitments will shape the future of cloud services, ensuring that technological growth aligns with environmental responsibility.

In an era where adaptability is key, organisations that proactively refine their cloud strategies will not only navigate the challenges of 2025 but also emerge as leaders in the digital transformation journey.