Emerging scale-out cloud applications need extensive amounts of computational resources. However, data centers using modern server hardware face physical constraints in space and power, limiting further expansion and calling for improvements in the computational density per server and in the per-operation energy use. Therefore, continuing to improve the computational resources of the cloud while staying within physical constraints mandates optimizing server efficiency to ensure that server hardware closely matches the needs of scale-out cloud applications. We use performance counters on modern servers to study a wide range of cloud applications, finding that today’s predominant processor architecture is inefficient for running these workloads. We find that inefficiency comes from the mismatch between the application needs and modern processors, particularly in the organization of instruction and data memory systems and the processor core architecture. Moreover, while today’s predominant architectures are inefficient when executing scale-out cloud applications, we find that the current hardware trends further exacerbate the mismatch. In this work, we identify the key micro-architectural needs of cloud applications, calling for a change in the trajectory of server processors that would lead to improved computational density and power efficiency in data centers.