Worldwide IT spending is expected to total $5.74 trillion (£4.4 trillion) in 2025, an increase of 9.3% from 2024, according to the latest forecast by Gartner.

“Current spending on gen AI has been predominantly from technology companies building the supply-side infrastructure for genAI,” said John-David Lovelock, distinguished VP analyst at Gartner.

“CIOs will begin to spend on genAI, beyond proof-of-concept work, starting in 2025. More money will be spent, but the expectations that CIOs have for the capabilities of genAI will drop. The reality of what can be accomplished with current genAI models, and the state of CIO’s data will not meet today’s lofty expectations.”

Server Sales Continue to Drive the Data Center Systems Segment
Data center systems spending grew by nearly 35% in 2024. While the segment will not see a jump equal to that in 2025, it is still set to grow by almost $50 billion in 2025.

This is led by server sales, which are set to almost triple from more than $134 billion (£103.2 billion) in 2023 to $332 billion (£256 billion) by 2028, including more than $257 billion (£198 billion) in 2025.

“GenAI will easily eclipse the effects that cloud and outsourcing vendors had on previous years regarding data center systems,” said Lovelock.

“It took 20 years for the cloud and outsourcing vendors to build up spending to $67 billion (£51.6 billion) a year on servers. The demand of GenAI will help nearly triple server sales from 2023 to 2028.”

Software and IT Services Drive Growth
Spending on software is expected to increase 14% to $1.23 billion (£947.2 million) in 2025, up from 11.7% growth in 2024. Meanwhile, IT services is expected to grow 9.4% to $1.73 billion (£1.33 billion) in 2025, up from 5.6% in 2024.

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“Software and IT services are a large driver of IT growth,” said Lovelock. “Spending on these segments is expected to be on AI-related projects, including email and authoring. This was a market that, despite its age and having been consolidated down to a small number of players, will add $6.6 billion to global spending in 2024 and $7.4 billion (£5.7 billion) 2025 due in part to genAI products and services.

“Our forecast projects that $500 billion (£385 billion) will be added in spending every year in terms of growth rates. With this in mind, IT spending should cross the $7 trillion (£5.3 trillion) mark in 2028.”