Turkcell Shifting Gears: $3 Billion Google Cloud Partnership Propels Turkey into the Hyperscale Era

In a landmark strategic pivot, Turkcell is redefining its identity from a traditional telecom operator to a dominant digital infrastructure powerhouse. The company’s newly announced partnership with Google Cloud, coupled with a massive $3 billion joint investment roadmap, is set to transform Turkey into a regional hub for artificial intelligence (AI) and cloud computing by 2032.

The Infrastructure Play: Beyond Connectivity

Management has outlined a clear framework to unlock the hidden value within its scalable digital assets. While fiber and 5G remain core components, the new growth engine is firmly rooted in Data Centers & Cloud Services. Turkcell currently commands a 39% market share in Turkey’s corporate data center market, operating 54 MW of capacity across strategic hubs in Gebze, İzmir, Ankara, and Çorlu.

To date, the company has invested approximately €545 million in these Tier III certified facilities. However, the vision for 2032 involves doubling active capacity to 100 MW and increasing the revenue share of this segment from its current 2-3% to a significant 8-10%.

The Google Cloud Alliance: A $3 Billion Catalyst

The centerpiece of Turkcell’s valuation rerating is the strategic agreement with Google Cloud. This partnership creates a “Hyperscale” ecosystem in Turkey with a massive capital commitment:

• Turkcell’s Share: $1 billion investment focused on the construction and operation of high-spec physical facilities.

• Google’s Share: $2 billion investment in hardware, software, and the gradual activation of a localized cloud infrastructure.

• The Ankara Hub: A specialized arrangement will see three data centers in a single Ankara location dedicated to Google, ensuring high revenue visibility and predictable long-term cash flows.

Initial capacity is slated to go live in 2028 with 15 MW, with meaningful revenue contributions expected to accelerate thereafter.

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Market Potential: Turkey’s Cloud Boom

According to IDC estimates, Turkey’s cloud computing market is poised to grow from $1.7 billion today to $4.2 billion by 2029, representing a 20% compound annual growth rate (CAGR). Turkey currently lags behind European cloud penetration levels; closing this gap could spark 2-3x growth in the SME and startup segments alone.

Financial Analysis: The Valuation Rerating

The most compelling aspect of this transition is the valuation gap. Traditional telecom businesses typically trade at lower EBITDA multiples (often 4x-6x). In contrast, specialized data center and cloud infrastructure providers globally attract multiples of 15x-25x.

By housing these operations under a separate subsidiary, Turkcell aims to achieve a “Sum-of-the-Parts” (SOTP) rerating. As AI workloads create structural—not cyclical—demand for high-density computing, Turkcell’s data center arm is no longer just a cost center for its mobile business; it is a standalone infrastructure asset with high-margin recurring dollar revenue.

Strategic Outlook: The “Hyper-Scale” Multiplier

Management expects data center and cloud revenues to increase six-fold by 2032. The partnership with Google serves as a global seal of approval, likely acting as a catalyst for other hyperscale players to enter the Turkish market. With segment EBITDA expected to exceed $100 million in 2026, Turkcell is effectively building a “company within a company” that could eventually command a valuation rivaling its core telecom business.