TLDR: Worldwide IT spending is projected to hit $5.43 trillion in 2025, marking a 7.9% increase, primarily fueled by continued investments in Artificial Intelligence (AI) and generative AI (GenAI). While global uncertainties have caused a slowdown in growth for software and IT services sectors, the robust spending in data centers, largely attributed to GenAI, is offsetting these challenges and bolstering overall IT expenditure.
Global IT spending is forecast to reach an impressive $5.43 trillion in 2025, representing a 7.9% increase from the $5.03 trillion recorded in 2024, which saw a 7.4% growth. This projection comes from a recent Gartner report, highlighting a significant shift in the IT landscape.
Despite a brief pause in net-new spending during the second quarter of 2025 due to global corporate uncertainties, the overall IT sector’s growth remains strong, largely propelled by ongoing Artificial Intelligence (AI) and generative AI (GenAI) digitization initiatives. John-David Lovelock, VP Analyst at Gartner, noted, ‘While there is a business pause on net-new spending due to a spike in global uncertainty, the effect is subsumed by ongoing AI and generative AI (GenAI) digitisation initiatives.’
However, not all segments of the IT market are experiencing uniform growth. The software sector, while still growing, is seeing a deceleration. Worldwide software spending is expected to reach $1.23 trillion in 2025, a 10.5% increase from $1.11 trillion in the previous year. This marks a slowdown compared to the 11.9% year-over-year growth posted in 2024. Similarly, the IT services sector’s growth rate has softened, projected to increase by 4.4% in 2025 to $1.68 trillion, down from 4.8% in 2024.
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In stark contrast, spending on data centers, heavily influenced by generative AI, has surged dramatically. This segment has witnessed a remarkable 42.4% growth, with total spending anticipated to hit $474 billion in 2025, up from $333 billion in 2024. Lovelock also commented on the evolving nature of AI spending, stating, ‘With GenAI sliding towards the trough of disillusionment, more time and spending is being focused on delivered functionality from incumbent software providers.’ He added that CIOs are increasingly seeking ‘plug and play’ simple use cases, focusing on acquiring delivered GenAI functionality rather than just the underlying technology.
