Worldwide IT services spending to increase in 2026

Overall, Gartner predicts worldwide IT spending will climb to $6.31 trillion in 2026—an increase of 13.5 percent year over year—with IT services continuing to represent the largest segment. Software remains to be the second-largest segment, reaching $1.44 trillion in 2026, a 15 percent gain compared to 2025.

Not surprisingly, the biggest percentage increase is being driven by artificial intelligence (AI). Data center systems spending is forecasted to grow 56 percent, reaching $787.99 billion in 2026.

Data center growth signals what’s ahead

While it’s not entirely clear to what degree growth in IT services spending is directly driven by AI, increased investment in data centers should be viewed as a leading indicator. Historically, expansion in data center infrastructure signals future demand for both software and services. With that in mind, overall demand beyond 2026 is likely to remain strong.

AI will reshape the services mix

That said, providers can expect the composition of IT services to change significantly in the AI era. Many low-value, repeatable services are increasingly being automated, forcing IT services providers to rethink their portfolios. To remain competitive, providers will need to develop higher-value services enabled by AI—services that deliver measurable business outcomes rather than solely technical outputs.

This shift may prove challenging. Many managed service providers (MSPs), for example, currently deliver tactical services that are prime candidates for automation. To evolve, these providers must design and manage workflows that require a deeper understanding of how a customer’s business actually operates.

Balancing scale, profitability, and relevance

The difficulty lies in making those services both scalable and profitable. Providers must determine whether they can offer repeatable, standardized services that work across multiple customers—or whether they’ll need to manage bespoke engagements that are more complex and costly to deliver.

Higher costs are not inherently negative. In fact, more expensive services are often less susceptible to commoditization. The challenge is whether those services are relevant to a sufficiently broad customer base. Striking the right balance between total cost, market demand, and profitability will become increasingly difficult.

Ultimately, IT services providers may need to work more closely with business consultants to identify and deliver these opportunities. In fact, the need for tighter alignment in the age of AI could eventually drive a new wave of mergers and acquisitions.

In the meantime, providers should assess the long-term viability of their existing service portfolios. Some offerings may soon become obsolete. More importantly, however, entirely new classes of services are emerging—ones that would not be possible without AI. While many providers have access to the same core technologies, not all will have the expertise required to harness them to their full potential.