Gartner Forecasts Significant Growth in Global IT Spending, Driven by AI and Price Increases

Global IT Spending Set to Surge in 2025

Gartner, a leading research and consulting firm, has released its latest forecast for worldwide IT spending, projecting a significant increase to $5.61 trillion in 2025, marking a 9.8% growth from 2024 1

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. This surge in spending is primarily driven by investments in artificial intelligence (AI) technologies and price increases across various IT sectors.

AI-Driven Growth and Infrastructure Investments

The forecast highlights a substantial growth in data center systems spending, expected to increase by 23.2% in 2025, following an impressive 39.4% growth in 2024 4

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. This surge is largely attributed to the rapid adoption of generative AI technologies, which has led to a permanent shift in server spending patterns. By 2028, it's predicted that hyperscalers, service providers, and cloud facilities will have invested approximately $1 trillion in AI-optimized servers 4

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Software and IT Services Lead the Way

Software and IT services are projected to be major drivers of IT spending growth. Global software spending is expected to increase by 14.2% in 2025, up from 12% in 2024 4

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. In India, software spending is forecasted to grow by 16.9% to $17.9 billion, while IT services are expected to increase by 11.2% to $30.1 billion in 2025 2

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The Impact of Generative AI

Gartner predicts that by 2028, generative AI will account for over $1 trillion in spending, including new markets such as AI models, specialized AI-managed services, and AI-optimized Infrastructure-as-a-Service (IaaS) 1

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. The research firm also forecasts that by 2026, over 50% of software spending within application software will be influenced by generative AI 2

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Price Increases and Budget Allocations

While IT budgets are increasing, a significant portion of this growth is expected to offset price increases in recurrent spending. John-David Lovelock, Distinguished VP Analyst at Gartner, noted, "This means that, in 2025, nominal spending versus real IT spending will be skewed, with price hikes absorbing some or all of budget growth" 3

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. Software providers have been steadily raising prices on cloud offerings since 2022 due to rising costs for skills and operational expenses 4

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Regional Insights: India's IT Landscape

In India, overall IT spending is forecasted to grow by 11.1% to $161.5 billion in 2025 1

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. The country is expected to see significant growth in data center systems spending, with a projected increase of 19.1% in 2025, nearly doubling its growth rate from 2024 3

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The Rise of AI-Ready Infrastructure

Enterprises are increasingly investing in AI-ready infrastructure for targeted use cases. Naveen Mishra, VP Analyst at Gartner, stated, "The emphasis on accelerated servers for AI workloads is a significant driver, resulting in increased end-user spending in this segment in 2025 compared to the previous year" 3

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PC Market Resurgence and AI PCs

The forecast also predicts a resurgence in PC sales, driven by scheduled replacements of machines purchased during the COVID-19 pandemic and Microsoft's plan to end support for Windows 10 in October 2025. Gartner anticipates that AI PCs will make up 43% of shipments in 2025 and nearly 100% by 2026 4

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As the IT industry continues to evolve rapidly, driven by AI advancements and changing market dynamics, organizations must carefully navigate these trends to optimize their technology investments and stay competitive in an increasingly digital world.