Data Processing & Hosting NAICS 518210

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Industry Summary
The 11,482 Data processing and hosting companies in the US provide outsourced information technology services to businesses and other organizations. These services include automating business processes, website hosting, providing business software applications via the Internet, video streaming services, time-shared computer capacity, and data entry and reporting services.
Protecting Security of Customer Data
High profile incidents of computer hackers gaining access to social security and credit card numbers housed on a customer's behalf has increased security concerns for data processing and hosting companies.
Cloud Computing
Widespread adoption of cloud computing has increased demand for data processing and hosting companies.
Recent Developments
Jul 1, 2025 - Cloud-based AI Demand By Financial Institutions Fuels Growth
- Adoption of cloud-based artificial intelligence (AI) by financial institutions is driving a significant increase in demand at data centers, according to Forbes. Google Cloud’s Toby Brown told Forbes that financial institutions have historically been "data-rich but insight-poor." Brown delineates between data "for offense", used to drive business growth, and "for defense", supporting risk management and regulatory compliance. AI is a key tool in enabling financial institutions to integrate data traditionally siloed in spreadsheets and legacy systems into unified cloud-based platforms with AI models and generative AI tooling built directly in line to accelerate insights and decision-making processes, according to Brown.
- Data centers around the world may require $6.7 trillion in capital expenditures by 2030 to keep pace with the demand for compute power, according to management consulting firm McKinsey & Company. The hardware, processors, memory, storage, and energy needed to operate these data centers are collectively known as compute power. Data centers equipped to handle AI processing loads are projected to require $5.2 trillion in capital expenditures, while those powering traditional IT applications are projected to require $1.5 trillion in capital expenditures.
- Private construction spending on data centers has more than doubled what it was in late 2022, according to the US Census Bureau. Companies are investing in data centers to get ahead in artificial intelligence, according to Bloomberg. Private construction spending on data centers has surged close to $30 billion a year.
- Revenue for computer data processing and hosting firms increased 13.2% year over year and 4.7% quarter over quarter in the fourth quarter of 2024, according to the US Census Bureau. Data processing and hosting industry employment and wages for nonsupervisory employees decreased slightly during the first five months of 2025, according to the US Bureau of Labor Statistics (BLS). Data processing and hosting firms slightly increased their prices during the first six months of 2025, according to the BLS.
Industry Revenue
Data Processing & Hosting

Industry Structure
Industry size & Structure
The average data processing and hosting company has about 50 workers and $28 million in annual revenue.
- There are about 11,482 data processing and hosting companies in the US that employ 570,188 workers and generate revenue of $325.6 billion.
- 50% of firms operate out of a single location.
- Large data processing and hosting companies include Automatic Data Processing, FISERV, Rackspace Hosting, and Alliance Data Systems. Web hosting and cloud computing services are also provided by units of large companies, such as AT&T, Amazon.com, Google and SS&C Technologies.
Industry Forecast
Industry Forecast
Data Processing & Hosting Industry Growth

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