Gartner: AI Adoption to Push Global IT Spending to US$5.4tn

Global IT expenditure is set for a major leap this year, with new Gartner data forecasting spending will hit a record US$5.43tn — up 7.9% from 2024. 

This comes as an unprecedented acceleration in AI and Gen AI investment balances a parallel wave of caution among CIOs  — with economic and geopolitical uncertainty prompting a strategic ‘uncertainty pause’ on net-new projects.

Regardless, data centre systems alone are expected to grow 42.4% as organisations invest heavily in infrastructure to support AI capabilities.

“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 Gen AI digitisation initiatives,” says John-David Lovelock, Distinguished VP Analyst at Gartner.

“For instance, both software and services spending growth in 2025 is expected to slow down due to this ‘uncertainty pause,’ but spending in AI-related infrastructure, such as data center systems, continues to surge.

"Data centres are experiencing a surge driven by Gen AI, with spending on AI optimised servers — which was virtually nonexistent in 2021 — expected to triple that of traditional servers by 2027.”

The impact of the AI data centre boom

AI has shifted from hype to day-to-day reality for most large enterprises. 

With this in mind, Gartner data shows data centre growth is far outpacing other IT sectors.

But, as John-David explains, this boom is not just about more servers — it encompasses a rise of a new generation of AI-optimised hardware specifically designed to run massive Gen AI workloads and foundational models.

A previous Gartner survey found that 62% of respondents identified AI as defining the future of competition for the next 10 years. 

The study gained insights from 252 senior leaders in North America and Western Europe with enterprisewide revenue of US$500m or more.

Competitiveness, Gartner says, is a key reason why organisations will invest in technology and business change in an eroding environment, with 64% resonating with this trend.

“With Gen AI sliding towards the trough of disillusionment, more time and spending is being focused on delivered functionality from incumbent software providers,” said John-David. “CIOs are looking towards more ‘plug and play’ simple use cases as they are being sold Gen AI functionality, but not necessarily buying the functionality.”

The ‘uncertainty pause’

Although digital budgets remain robust, a pause in actual spending has been driven by heightened uncertainty and geopolitical risks.

This delay — coined an ‘uncertainty pause’ — started in Q2 of 2025 and encompasses a strategic suspension of net-new initiatives across a breadth of departments, including IT, by CIOs.

Key areas of worry Gartner unearthed around this trend include:

• Only 24% of organisations expect to end 2025 ahead of their plans, down from 61% at the year’s start
• Hardware and infrastructure face the heaviest pressure, especially as costs rise
• Recurring spend areas like cloud and managed services retain more stability as their value is already demonstrable.
• Economic shocks, 41%, and geopolitical threats, 32%, top the list of executive concerns, outweighing competitive and regulatory risks

“This pause does not stem from budget cuts, as budgets remain fully allocated,” John-David adds. “Rather, it is a strategic decision to delay new expenditures. 

“The IT hardware and infrastructure sectors are particularly affected due to price increases and supply chain disruptions. 

“In contrast, ongoing or recurring spending, such as cloud and managed services, is maintaining greater stability.”