IT spending spikes in Europe: AI unsurprisingly the cause

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Gartner sees a 6.8 percent increase in European IT spending in 2025 and expects a further increase in 2025. AI is the – not surprising – driver of investment.

IT spending in Europe is expected to grow to $1.28 trillion by 2025, according to Gartner forecasts. That’s an 8.7 percent increase from 2024. Investment in AI-related IT services is a particularly strong contributor to this growth.

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Even by 2024, Gartner sees a significant increase of 6.7 percent. Gartner divides investments into five categories: data center, devices, software, IT services and communications. Data center and software are the fastest-growing categories with increases of more than 11 percent.

AI and cloud boost spending

According to Gartner, European CIOs are driving up IT spending to strengthen their competitive position and further grow their organizations. Generative AI in particular remains a key driver. IT services specifically focused on AI applications will grow by 21 percent, with total spending in that segment rising from $78 billion in 2024 to $94 billion in 2025. Gartner sees European companies increasingly moving away from building GenAI solutions themselves and opting more often for turnkey solutions from external partners.

Interest in public cloud also remains strong. Spending on public cloud solutions is estimated at $123 billion in 2024 and will continue to increase in 2025. In addition, IT security spending is on the rise, expected to reach $47 billion this year.

Data Centers

Another key growth factor within IT spending is demand for data center systems, with Gartner predicting that European spending on servers will increase by 25 percent by 2024. This trend stems from the increasing demand for AI-optimized servers, driven primarily by the expansion of infrastructure needed to train and use AI models. Although the growth rate is expected to slow to 11 percent by 2025, demand for server capacity remains significant.

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Furthermore, investment in software and devices is also on the rise. Software spending is expected to increase by 13.2 percent, while spending on devices grows by 9.3 percent. Growth in communications services remains limited, rising only 3.6 percent.

Strategic choice

Since the pandemic, European companies are increasingly recognizing the value of IT investments to support their operations and innovation. Growth projections for 2025 represent the highest growth rate since the 2021 upturn, according to Gartner. Choosing IT partner solutions over in-house development should help companies integrate AI technologies more efficiently and quickly.

With these predictions, Gartner highlights the continuing and growing role of IT spending in the European economy, with an increasing focus on cloud, AI and security.

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