Global IT spending is expected to total $5.61 trillion in 2025, an increase of 9.8% from 2024, according to the latest forecast by Gartner, Inc.

“While budgets for CIOs are increasing, a significant portion will merely offset price increases within their recurrent spending,” said John-David Lovelock, Distinguished VP Analyst at Gartner. “This means that, in 2025, nominal spending versus real IT spending will be skewed, with price hikes absorbing some or all of budget growth. All major categories are reflecting higher-than-expected prices, prompting CIOs to defer and scale back their true budget expectations.”

GenAI will Influence IT Spending, but IT Spending Won’t Be on GenAI Itself:

Segments including data center systems, devices and software will see double-digit growth in 2025, largely due to generative AI (GenAI) hardware upgrades (see Table 1). However, these upgraded segments will not differentiate themselves in terms of functionality yet, even with new hardware.

Table 1. Worldwide IT Spending Forecast (Millions of U.S. Dollars) 

^{Source: Gartner (January 2025)}

“GenAI is sliding toward the trough of disillusionment which reflects CIOs declining expectations for GenAI, but not their spending on this technology,” said Lovelock. “For instance, the new AI ready PCs do not yet have ‘must have’ applications that utilize the hardware. While both consumers and enterprises will purchase AI-enabled PC, tablets and mobile phones, those purchases will not be overly influenced by the GenAI functionality.”

Spending on AI-optimized servers easily doubles spending on traditional servers in 2025, reaching $202 billion dollars.

“IT services companies and hyperscalers account for over 70% of spending in 2025,” said Lovelock. “By 2028, hyperscalers will operate $1 trillion dollars’ worth of AI optimized servers, but not within their traditional business model or IaaS Market. Hyperscalers are pivoting to be part of the oligopoly AI model market.”

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of the sales by over a thousand vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.

More information on the forecast can be found in the complimentary Gartner webinar “IT Spending Forecast, 4Q24 Update: GenAI’s Impact on a $7 Trillion IT Market.”

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Gartner’s 2025 forecast for IT spending is consistent with the market research firm’s predictions from late last year that the move to AI is driving a surge in spending on data center infrastructure and IT services in Europe.  IT spending across the continent will come in at US$1.28 trillion in 2025 they said. Presumably it takes a little longer to gather up the data necessary for predictions across the whole world.

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In a recent survey of network operators, GSMA found that telcos are allocating more resources to in-house and out-of-house AIs capabilities and projects, but only a subset are spending more than 15% of their digital budgets on AI.  Nearly half of operators are dedicating 5% to 15% of their digital budgets towards AI, covering a range of categories, including data systems, large language models and infrastructure upgrades, the GSMA survey found. That AI money is also being allocated toward AI teams, tools and partnerships, said GSMA. The association, which primarily represents mobile operators, has been asked for more details about the size, scope and methodology of its latest study.

AI Status at Network Operators:

References:

https://www.gartner.com/en/newsroom/press-releases/20s25-01-21-gartner-forecasts-worldwide-it-spending-to-grow-9-point-8-percent-in-2025

https://www.telecoms.com/ai/gartner-points-to-declining-expectations-for-genai-but-not-a-decline-in-spending

https://data.gsmaintelligence.com/api-web/v2/research-file-download?id=88244886&file=090125-Telco-AI-State-of-the-Market-Q4-24.pdf