Gartner: IT Spending Growth Led by AI Data Centre Demand
European organisations will spend US$1.28tn on information technology in 2025, marking an 8.7% rise from 2024, according to technology research and consulting firm Gartner, in a forecast representing the most substantial increase in European IT spending since the post-pandemic period.
The forecast points to sustained growth in IT spending across Europe, which is expected to reach US$1.18tn by the end of 2024. The findings were presented at Gartner's IT Symposium/Xpo in Barcelona, a conference for Chief Information Officers and IT executives.
Data centre infrastructure drives growth
The expansion of AI infrastructure by technology providers has created new demand for specialised data centre systems, particularly AI-optimised servers. These systems are designed specifically to handle the computational requirements of machine learning and AI workloads.
“In 2024, the surge of building out AI-related infrastructure by technology providers is driving high levels of spending on data centre systems in Europe,” says John-David Lovelock, Distinguished VP Analyst at Gartner.
Server spending in Europe is projected to increase by 25% in 2024, driven by demand for AI-optimised hardware. This growth rate will moderate to 11% in 2025. Technology providers have increased their server spending by 46% in 2024, indicating a substantial build-out of AI infrastructure capacity.
“Europe has seen a remarkable 46% increase in server spending by technology providers in 2024. In 2025, technology companies will continue building out the infrastructure needed for training Gen AI models today and inferencing them in the future,” says John-David.
AI services market transformation
Public cloud spending in Europe is forecast to reach US$123bn in 2024, while cybersecurity spending will reach US$47bn in the same period. Cloud services, provided by companies such as Amazon Web Services, Microsoft Azure and Google Cloud, allow organisations to access computing resources over the internet rather than maintaining their own data centres.
In 2025, technology companies will continue building out the infrastructure needed for training Gen AI models
Spending on IT services related to AI in Europe will increase from US$78bn in 2024 to US$94bn in 2025. This growth coincides with a shift in how organisations approach generative AI – computer systems that can create content from text to images.
“The limited success of many pilots and proofs of concept in 2024, will push European organisations to shift from building their own Gen AI solutions to buying and implementing partner solutions in 2025,” says John-David.
The forecast shows varied growth across IT sectors. Software spending will increase by 13.2% to US$288bn in 2025, while communications services will see more modest growth of 3.6% to US$302bn. Device spending is set to grow by 9.3% to US$146bn, and IT services will increase by 9.2% to US$489bn.
Market analysis and methodology
The data comes from Gartner's quarterly IT spending forecast, which analyses sales data from over a thousand vendors across hardware, software, IT services and telecommunications segments. The research methodology combines primary research techniques with secondary research sources to build a database of market size data.
- Total IT Spending: $1.28 trillion
- AI Services Market: $94 billion
- Data Centre Systems: $54.4 billion
- Software Spending: $288 billion
- IT Services: $489 billion
Data centre systems spending, which includes servers, storage, and networking equipment, will reach US$54.4 billion in 2025, representing an 8.7% increase from 2024. This growth reflects the ongoing transformation of enterprise computing infrastructure to support AI workloads.
The shift towards partner-built solutions indicates a maturing market for AI services, as organisations move away from experimental in-house development towards proven, scalable solutions from established vendors.
“CIOs in Europe will continue investing in public cloud end-user spending, which is estimated to reach US$123bn in 2024, and grow their security spending, projected to reach US$47bn in 2024,” says John-David.
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