2025 saw fastest growth in IT spend since mid-'90s, says IDC

It was a banner year for worldwide investments in hardware, software and IT services, a December report from IDC shows. 

WHY IT MATTERS
Information technology spend in 2025 will have posted an increase of 14% by the end of Q4, according to the study in IDC's monthly Worldwide Black Book, "representing the fastest year of growth since 1996 when the launch of Windows 95, expanding PC usage and Internet adoption were the primary drivers of IT spending."

A lot has changed since those early days of the World Wide Web, of course. Three decades on, IT spending is focused largely on the significant AI infrastructure investments and advanced cloud computing services. 

Worldwide, the past year has seen a "supercycle of tech spending," according to IDC – projected to have reached $4.25 trillion by the end of 2025. Additionally, total ICT spending – telecom and business services, in addition to IT – will approach $7 trillion for the calendar year, researchers say.

In addition to AI infrastructure, the past year has seen robust spending on enterprise projects as healthcare and other organizations continue with their wide-scale digital transformation efforts. IDC expects to see software spending up 14% by year's end, "with AI deployments adding to investments in security, optimization and analytics."

IT spending on machines also increased early in 2025, as organizations had prioritized PC shipments in Q1 ahead of the Trump administration's anticipated tariffs.

Another huge story this past year, of course, has been the proliferation of AI data centers. IDC says there was a marked increase of spending on servers, storage and network equipment for 2025 – up 86%, or nearly half a trillion dollars.

"AI is the headline of IT market performance in 2025, but most of the actual AI investment this year is concentrated in service provider infrastructure," said Stephen Minton, group vice president at IDC, in a statement. "This AI investment is partly supported by enterprise spending on core IT products and services, which make up the strong revenue streams of the service providers investing heavily in AI deployment. 

"In turn, this AI investment is supporting economic growth and stability, which in turn is supporting the ability of businesses to maintain their investments in cloud services and enterprise software," he added. "As a result, we're currently experiencing a virtuous cycle of tech-driven macroeconomic growth."

THE LARGER TREND
As for 2026, IDC researchers say there is "so far no evidence of any slowdown taking hold," and the firm says it expects most organizations still plan to increase their IT budgets yet again for the year ahead – even with some ongoing anxiety around the overall economy. Driven largely by investments in leading-edge tech such as agentic AI, researchers predict that spend will be up by 10% in 2026.

In the healthcare space, that's probably because so many IT investments – not least in AI and machine learning – are starting to show ROI for hospitals and health systems. Over the past 12 months we've showcased many success stories where spending on software and automation tools is paying dividends.

These include St. Luke's Health System, which gained hard dollar ROI – $13,000 in annual revenue per clinician – by investing in an AI scribe; Tampa General, which gained back 700 hours of productivity with help from an OR optimization platform; and Lehigh Valley Health Network, which saved $2.5 million with perioperative analytics software.

Just this week, we've shown how investments in AI-enabled workflow analytics and an AI-powered phone system have enabled significant efficiencies and cost reductions for two very different healthcare organizations.

ON THE RECORD
"There are headwinds and downside risks in the 2026 outlook, including an expected memory component shortage which may drive up PC prices next year," said Minton. 

"Technology demand has been resilient this year in the face of uncertainty around tariffs and a sluggish global economy, but our baseline forecast calls for a stable economy, supported in part by ongoing AI investment. Even in a moderate recession, most IT spending would continue. The likelihood of a 'perfect storm' similar to the IT market crash of 2001 remains low."