IT Budget Statistics 2026
By Axis Intelligence Research
Co-authors: Elena Rodriguez & Mia Scarlett | Last updated: August 11, 2026 | License: CC BY 4.0
Worldwide IT spending reaches $6.369 trillion in 2026, up 14.2% from $5.577 trillion in 2025, according to Gartner’s July 2026 forecast. But the number that decides whether your roadmap ships is not the total. It is the share of the budget that funds new capability rather than keeping existing systems alive. In the largest IT portfolio anyone can audit, that share is 21%.
Quick Answer
Global IT budgets total $6.369 trillion in 2026, a 14.2% increase over 2025 (Gartner, July 27, 2026). According to Axis Intelligence Research, 48.1% of every incremental IT dollar spent in 2026 goes to data center systems and infrastructure as a service – $381 billion of the $792 billion added year over year. In the United States federal portfolio, the only large IT budget with a publicly auditable run-versus-build split, the IT Modernization Rate (ITMR) reads 21.0 for fiscal 2025: roughly one dollar in five buys something that did not exist before.
Key Findings
- Worldwide IT spending will total $6.369 trillion in 2026, up 14.2% from $5.577 trillion in 2025, with data center systems growing 62.5% to $822 billion (Gartner, July 27, 2026).
- According to Axis Intelligence Research, data center systems and IaaS together absorb 48.1% of the $792 billion added to global IT budgets in 2026, calculated from Gartner’s July 2026 segment table.
- According to Axis Intelligence Research, the IT Modernization Rate for the 24 US Chief Financial Officers Act agencies reads 21.0 for fiscal year 2025, derived from the Government Accountability Office’s finding that 79% of planned IT spending was operations and maintenance.
- US private fixed investment in information processing equipment and software ran at a $1.613 trillion seasonally adjusted annual rate in the second quarter of 2026, 19.3% above the same quarter of 2025 (Bureau of Economic Analysis, released July 30, 2026).
- Fifty-two percent of government CIOs outside the United States expect their IT budgets to rise in 2026, with cybersecurity (85%) and AI (80%) the top categories for increased investment (Gartner CIO and Technology Executive Survey, November 26, 2025).
How Big Is the Global IT Budget in 2026?
$6.369 trillion, and the composition has changed faster than the headline.
Gartner has revised its 2026 forecast four times in nine months: 9.8% growth in October 2025, 10.8% in February 2026, 13.5% in April, and 14.2% in the July 27, 2026 release. Each revision moved the same segment: data center systems. Gartner’s John-David Lovelock described building AI compute capacity as the largest infrastructure project ever attempted, and the segment table shows why that language is not marketing.
Worldwide IT spending by segment, 2025 and 2026
| Segment | 2025 spending ($B) | 2026 spending ($B) | Growth | 2026 share of budget | Source |
|---|---|---|---|---|---|
| Data center systems | 506 | 822 | 62.5% | 12.91% | Gartner, Jul 2026 |
| Devices | 790 | 868 | 9.8% | 13.63% | Gartner, Jul 2026 |
| Software | 1,271 | 1,468 | 15.5% | 23.05% | Gartner, Jul 2026 |
| Services | 1,492 | 1,570 | 5.3% | 24.65% | Gartner, Jul 2026 |
| Infrastructure as a service | 222 | 287 | 29.3% | 4.51% | Gartner, Jul 2026 |
| Communications services | 1,296 | 1,354 | 4.4% | 21.26% | Gartner, Jul 2026 |
| Total IT | 5,577 | 6,369 | 14.2% | 100% | Gartner, Jul 2026 |
Share column calculated by Axis Intelligence Research from Gartner’s published segment values. Gartner publishes absolute figures and growth rates, not shares.
Read the share column against the growth column and the tension shows up immediately. Services is still the biggest single line at 24.65% of global IT spending, but it grew 5.3% while the total grew 14.2% – which means services lost 2.1 percentage points of budget share in a single year without anyone cutting it. The same happened to communications services, down from 23.24% to 21.26%. Nothing was cancelled. The denominator moved.
Where every new IT dollar goes in 2026
Total spending tells you the size of the pot. Incremental spending tells you who is winning the argument in budget season. Global IT budgets added $792 billion between 2025 and 2026. Here is where it landed.
| Segment | Incremental spend, 2025 to 2026 ($B) | Share of all new IT dollars | Source |
|---|---|---|---|
| Data center systems | 316 | 39.90% | Axis calculation from Gartner, Jul 2026 |
| Software | 197 | 24.87% | Axis calculation from Gartner, Jul 2026 |
| Devices | 78 | 9.85% | Axis calculation from Gartner, Jul 2026 |
| Services | 78 | 9.85% | Axis calculation from Gartner, Jul 2026 |
| Infrastructure as a service | 65 | 8.21% | Axis calculation from Gartner, Jul 2026 |
| Communications services | 58 | 7.32% | Axis calculation from Gartner, Jul 2026 |
| Total incremental | 792 | 100% | Axis calculation from Gartner, Jul 2026 |
Formula: incremental spend = 2026 segment spending minus 2025 segment spending. Share = segment increment / 792. Inputs are Gartner’s July 2026 Table 1 values; no interpolation.
According to Axis Intelligence Research, data center systems and infrastructure as a service together take $381 billion of that $792 billion, or 48.1% of all new IT spending worldwide in 2026. Put the two capacity segments next to the two segments most enterprises think of as “the IT budget” – services and devices – and the capacity side outspends them by nearly two and a half to one on incremental dollars.
One more cut of the same table. The three segments most directly exposed to AI workloads – data center systems, software, and IaaS – accounted for 35.84% of worldwide IT spending in 2025 and 40.46% in 2026. According to Axis Intelligence Research, that is a 4.62 percentage point shift in the composition of the global IT budget inside twelve months, which is a faster reallocation than the entire cloud migration produced in any comparable period.
Elena Rodriguez: Consumption is where this gets uncomfortable for anyone running a per-seat model. A 62.5% jump in data center systems is a capacity purchase – it lands as depreciation or as a committed cloud contract, and it does not flex when adoption disappoints. Services growing 5.3% against a 14.2% market means the integrators are not capturing the AI budget; the hardware is. If your 2027 plan assumes the systems-integration line grows with the market, check that assumption against this table before you sign anything.
How Should an IT Budget Be Split Between Running and Building?
Every CIO has been asked some version of this question by a board, and almost every published answer traces back to a consulting benchmark that nobody can audit. So Axis Intelligence Research built the ratio on data that can be.
The IT Modernization Rate (ITMR)
ITMR – IT Modernization Rate is the share of a technology budget that funds new or improved capability rather than sustaining what already runs.
ITMR = [ DME / (DME + O&M) ] * 100
Where DME is development, modernization, and enhancement spending, and O&M is operations and maintenance spending, both measured over the same budget period and the same portfolio scope.
The two components are not an Axis invention. They are the standard categories US federal agencies must report under Office of Management and Budget capital planning and investment control guidance, which makes the federal IT portfolio the largest technology budget in the world whose run-versus-build split is published, audited, and reproducible by an outsider. Private-sector CIOs use the same two buckets under different names – “keep the lights on” versus “change the business” – but almost never publish them.
Reference conditions. ITMR is scope-sensitive and currency-neutral. A reading is only comparable to another reading with the same portfolio boundary, the same fiscal period, and the same treatment of labor. It says nothing about whether the spending is well directed; a portfolio can post a high ITMR while building the wrong thing.
Axis interpretive scale. These bands are an Axis Intelligence Research convention anchored on the federal reading, not a distribution derived from a survey of organizations:
| ITMR reading | Reading label | What it describes |
|---|---|---|
| Below 20 | Maintenance-dominant | New capability is funded from exceptions, not from the base budget |
| 20 to 30 | Constrained | A modernization program exists but competes with sustainment every cycle |
| 30 to 40 | Balanced | Sustained capacity to retire systems while running them |
| Above 40 | Build-heavy | Typical of greenfield estates or of a portfolio mid-replatform |
ITMR readings
| Portfolio | Fiscal year | Total planned IT ($B) | O&M ($B) | DME ($B) | ITMR | Source |
|---|---|---|---|---|---|---|
| 24 US Chief Financial Officers Act agencies | 2025 | 105.1 | 83 | 22.1 | 21.0 | Axis calculation from GAO-25-107795 |
| 26 US federal agencies reporting to the IT Dashboard | 2024 | 95 | 74 | 21 | 22.1 | Axis calculation from GAO-24-106693 |
Method note: the Government Accountability Office reports that about $83 billion, or 79%, of fiscal 2025 planned IT spending across the 24 CFO Act agencies was operations and maintenance. ITMR is the complement of that share, 21.0. The implied total, $105.1 billion, is derived as $83B / 0.79 and is shown to one decimal to signal that it is derived rather than reported. The fiscal 2024 row uses GAO’s separately reported figures for a 26-agency scope.
The two readings are not a trend. The agency counts differ (26 versus 24) and GAO rounds its components, so the 1.1-point gap between fiscal 2024 and fiscal 2025 is within the noise created by scope and rounding alone. Axis Intelligence Research publishes both rather than fitting a line through them, and treats the fiscal 2025 figure as the baseline reading. Anyone who quotes a federal modernization trend from these two numbers is quoting an artifact.
How to compute your own ITMR
The ratio is portable, and computing it takes an afternoon rather than a benchmarking engagement.
- Draw the portfolio boundary and write it down. Whole IT organization, or one business unit, or one platform. Most disagreements about “our number” are really disagreements about the boundary.
- Classify every line of the budget as DME or O&M. Licence renewals, hosting, support contracts, patching, service desk, and the labor that keeps existing systems available are O&M. New builds, replatforming, major version upgrades that add capability, and the labor attached to them are DME.
- Handle the ambiguous cases with a written rule and apply it consistently. A cloud migration that changes nothing functionally is a judgment call; whichever way you rule, rule the same way next year, because year-over-year comparability is the entire value of the metric.
- Compute ITMR = DME / (DME + O&M) * 100.
- Record the boundary, the fiscal period, and the labor treatment alongside the number. A reading without those three is not comparable to anything, including your own prior year.
According to Axis Intelligence Research, an organization computing ITMR for the first time should expect the initial reading to be lower than leadership assumes, because sustainment labor is routinely booked against project codes and only surfaces when the classification rule is written down.
Elena Rodriguez: Twenty-one cents of the dollar. That is the federal baseline, and before anyone reaches for the easy conclusion that government is uniquely bad at this, notice that no large private-sector estate publishes a comparable number. The reason a comparison is hard is not that private companies score better. It is that they do not report DME and O&M at all, so the only auditable run-versus-build split in existence belongs to the organization everyone likes to use as the negative example. If your board wants a benchmark, this is the one that comes with a methodology attached.
How Much Do US Businesses Spend on IT Each Year?
The Bureau of Economic Analysis tracks this directly, and the 2026 figures are the steepest in the series’ modern history.
US private fixed investment in information processing equipment and software reached a $1.613 trillion seasonally adjusted annual rate in the second quarter of 2026, per the BEA series retrieved from FRED and released July 30, 2026. That is 19.3% above the second quarter of 2025 and 1.88 times the level of the fourth quarter of 2019.
US private fixed investment in information processing equipment and software
| Year | Investment, annual average ($B) | Growth | Source |
|---|---|---|---|
| 2020 | 878.4 | Axis calculation from BEA series A679RC | |
| 2021 | 975.0 | 11.0% | Axis calculation from BEA series A679RC |
| 2022 | 1,079.4 | 10.7% | Axis calculation from BEA series A679RC |
| 2023 | 1,111.8 | 3.0% | Axis calculation from BEA series A679RC |
| 2024 | 1,194.1 | 7.6% | Axis calculation from BEA series A679RC |
| 2025 | 1,381.4 | 15.7% | Axis calculation from BEA series A679RC |
| 2026 (first half) | 1,584.7 | 14.7% vs 2025 average | Axis calculation from BEA series A679RC |
Method note: annual figures are the arithmetic mean of the four quarterly seasonally adjusted annual rate observations; the 2026 row is the mean of Q1 and Q2 only and is labeled as a partial year. Growth is year over year on those averages.
According to Axis Intelligence Research, US business IT investment grew at a 9.48% compound annual rate from 2020 to 2025 and expanded 57.3% across those five years. The 2023 line is the one worth pausing on: 3.0% growth, in the year that everyone now describes as the start of the AI investment cycle. Whatever was happening in 2023, it was not showing up in national accounts. The acceleration is a 2025 and 2026 phenomenon.
A note on what this series is and is not. It measures capital investment in information processing equipment and software by US private business. It excludes communications services, most IT labor, and the operating expense portion of cloud consumption. It is therefore a floor on US corporate technology spending, not a total, and it is not comparable to Gartner’s worldwide figure – different geography, different scope, different accounting basis. Axis Intelligence Research publishes them in adjacent sections rather than merging them, because averaging a national-accounts capital series with a vendor-revenue forecast would produce a number that means nothing.
What Is the US Federal IT Budget?
The federal portfolio matters here for a reason beyond its size: it is the reference case for the ITMR, and it is documented in public.
Across the 24 Chief Financial Officers Act agencies, planned IT spending for fiscal year 2025 was approximately $105 billion, of which about $83 billion was operations and maintenance, per GAO-25-107795, published July 17, 2025. GAO also notes that each year the federal government spends more than $100 billion on IT and cyber-related investments, and has typically reported roughly 80% of it on operations and maintenance of existing systems.
The consequences are documented rather than theoretical. GAO reviewed 69 agency-nominated legacy systems and identified 11 as most in need of modernization; those 11 range from 23 to 60 years old and cost approximately $754 million a year to operate and maintain. Eight of the 11 use legacy programming languages including COBOL and assembly language code, seven operate with known cybersecurity vulnerabilities that cannot be remediated without modernization, and eight cannot implement the federal zero trust architecture strategy in their current form. Two had no modernization plan at all. The Department of Defense system on that list was first developed in 1964 and, according to agency officials, is supported by a team whose developers average over 60 years of age.
Forward-looking federal IT figures for fiscal 2027 are published by the Office of Management and Budget in Table 05-4 of the FY2027 Analytical Perspectives, which OMB distributes as a spreadsheet supplement rather than in the printed volume. The management chapter itself, published April 2026, describes the technology posture rather than the totals: consolidation of duplicative systems and websites, with 1,200 redundant websites already eliminated, and more than 3,500 AI use cases reported across the federal government. For the broader budget context, the same volume reports total federal investment spending of $696.3 billion in 2025, rising to a proposed $1,011.0 billion in 2027 across physical capital, research and development, and education and training.
Elena Rodriguez: A 60-year-old contract payment system with a retiring COBOL bench is what a maintenance-dominant ITMR looks like after four decades of compounding. The instructive part is not the age. It is that DOD officials told GAO they repeatedly sought modernization funding and lost to higher-priority claims – the modernization line is the one that loses those arguments, every year, in every organization, which is precisely why it needs a number attached to it.
Are IT Budgets Increasing in 2026?
Yes, on both the buy side and the build side, though the reported magnitudes depend heavily on who is being asked.
Public sector
Fifty-two percent of government CIOs outside the United States expect IT budget increases in 2026, according to the 2026 Gartner CIO and Technology Executive Survey, which gathered 2,501 responses between May 1 and June 30, 2025, including 284 government CIOs outside the US. Where those increases go, in order: cybersecurity (85% planning increased investment), AI (80%), generative AI (80%), and cloud platforms (76%).
The procurement signal in that survey is the underrated one. Fifty-five percent of those CIOs expect to change how they engage technology providers because of geopolitical tension and digital sovereignty concerns, and 39% plan to work more closely with providers based in their own region. Location has entered the evaluation criteria alongside cost and scale. Any vendor modeling public-sector pipeline on price and feature comparison alone is modeling a market that no longer exists in the same form.
Private sector
Gartner’s CFO Budget Priorities survey of 303 finance leaders, fielded September to October 2025 and released February 10, 2026, found that 75% of CFOs expected technology budgets to rise in 2026, with 48% expecting increases of 10% or more, against headcount growth expectations falling from 6% in 2025 to 2% in 2026. Axis Intelligence Research maintains these figures on its enterprise software spending page and restates them here at the same values and as-of date rather than recomputing them.
That five-to-one gap between technology budget growth and headcount growth is the structural fact underneath every 2026 IT budget conversation. Technology spending is no longer being justified as a cost of supporting people. It is being justified as a substitute for hiring them.
What Percentage of Revenue Should Go to IT?
This is the most-searched IT budget benchmark and the one with the weakest evidentiary base, so it deserves a direct answer rather than a recycled figure.
There is no authoritative public source for IT spending as a percentage of revenue by industry. The percentages that circulate – commonly 2% to 4% for manufacturing and retail, 6% to 12% for banking and insurance, higher for software firms – originate in proprietary benchmarking programs sold by advisory firms. Those datasets are real, but they are not public, their samples are self-selected by paying clients, and their definitions of what belongs in the IT budget vary enough that two vendors can report figures a factor of two apart for the same industry without either being wrong.
Axis Intelligence Research does not publish a percent-of-revenue benchmark for that reason. What we publish instead is the ITMR, because it is computed from two numbers an organization already has, it does not require knowing what a self-selected peer group did, and its inputs are auditable in at least one large portfolio.
If a board asks for the percent-of-revenue number anyway, the defensible answer has three parts: state the source and its sample basis, state that the sample is not representative, and pair it with an internal ratio that can actually be verified. A benchmark you cannot audit is a negotiating position, not a measurement.
Methodology
Collection. Every figure in this article was retrieved from a primary source during production on August 10, 2026, and each appears as a row in the accompanying CSV with source organization, document, URL, and retrieval date. No figure was reproduced from model memory or from a secondary aggregator. Sources used: Gartner’s quarterly worldwide IT spending forecast (July 27, 2026), Gartner’s 2026 CIO and Technology Executive Survey press release (November 26, 2025), US Government Accountability Office reports GAO-25-107795 and GAO-24-106693, the Office of Management and Budget FY2027 Analytical Perspectives volume and its management chapter, and Bureau of Economic Analysis series A679RC retrieved from FRED.
Formulas. Segment shares are segment spending divided by total IT spending for the same year. Incremental spend is 2026 segment spending minus 2025 segment spending; incremental share is that difference divided by $792 billion. ITMR is DME divided by the sum of DME and O&M, times 100. Annual BEA figures are arithmetic means of quarterly seasonally adjusted annual rate observations, with the 2026 figure covering two quarters and labeled accordingly. Compound annual growth is computed over five intervals from the 2020 to the 2025 annual average.
Currency and rounding. All values are current US dollars unless stated. Gartner publishes segment values in billions to whole numbers; derived shares are shown to two decimals to preserve the arithmetic, not to imply precision Gartner does not claim. Derived totals are marked as derived in the CSV.
Scope and caveats. ITMR readings for fiscal 2024 and fiscal 2025 cover different agency counts and are published side by side rather than as a series. The BEA capital series and the Gartner vendor-revenue forecast measure different things and are not combined anywhere in this article. Gartner’s forecast is a forecast and has been revised upward four times for the 2026 year; the July 2026 vintage is used throughout, and any figure restated from another Axis page carries that page’s as-of date. The Axis interpretive bands for ITMR are a stated convention, not an empirical distribution.
Original elements. The ITMR metric and its formula, interpretive scale, and federal readings; the incremental-spend allocation table and the 48.1% infrastructure absorption figure; the AI-exposed share of the global IT budget and its 4.62 point year-over-year shift; the BEA annual-average series and its growth and compound growth figures; and the documented non-merge statements between incompatible sources.
About This Dataset
The companion CSV is the fact table for this article. Every number in the prose above exists as a row, with its value, unit, as-of date, source organization, source document, source URL, retrieval date, whether the source is primary, whether the value was calculated by Axis Intelligence Research, and a method note for every calculated row.
Coverage: worldwide IT spending by segment for 2025 and 2026; incremental spend and share by segment for 2026; ITMR components and readings for US federal fiscal years 2024 and 2025; US private fixed investment in information processing equipment and software, quarterly from Q1 2020 through Q2 2026 and as annual averages; federal legacy system attributes; and 2026 CIO and CFO budget survey results.
License: Creative Commons Attribution 4.0 International (CC BY 4.0). Reuse, redistribution, and derivative work are permitted with attribution.
Citation: Axis Intelligence Research, IT Budget Statistics 2026, 2026.
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APA: Axis Intelligence Research. (2026). IT budget statistics 2026. https://axis-intelligence.com/it-budget-statistics/
MLA: Axis Intelligence Research. “IT Budget Statistics 2026.” Axis Intelligence Research, 11 Aug. 2026, axis-intelligence.com/it-budget-statistics/.
Chicago: Axis Intelligence Research. “IT Budget Statistics 2026.” Axis Intelligence Research. Last modified August 11, 2026. https://axis-intelligence.com/it-budget-statistics/.
Frequently Asked Questions
What is the IT Modernization Rate and why should a CIO track it?
ITMR is the share of a technology budget funding new or improved capability rather than sustaining existing systems: DME divided by DME plus O&M, times 100. A CIO tracks it because it is the single ratio that predicts whether a roadmap is fundable. Total budget growth can be entirely absorbed by price increases and sustainment; ITMR is what remains after the estate takes its cut, and it is comparable year over year within an organization in a way that percent-of-revenue never is.
Why is 79% of the federal IT budget spent on operations and maintenance?
Because the estate is old and each additional year of deferral raises the sustainment cost of the next year. GAO’s 2025 review found federal systems between 23 and 60 years old, several running COBOL or assembly language code with shrinking labor pools, and eleven of them consuming roughly $754 million annually just to keep running. Sustainment on aging systems compounds, and because modernization funding competes against it in every appropriations cycle, the ratio tends to worsen unless a program is explicitly ring-fenced.
Is a 21% modernization rate good or bad?
On the Axis interpretive scale it sits at the bottom of the constrained band: a modernization program exists but is competing with sustainment every cycle. Whether it is bad depends on the estate. A portfolio that has just finished a major replatforming should read low and that is healthy. A portfolio that has read low for a decade is deferring cost, not saving it.
How much of the 2026 IT budget increase is going to AI infrastructure?
Data center systems and IaaS take $381 billion of the $792 billion added to worldwide IT spending in 2026, which Axis Intelligence Research calculates as 48.1% of all incremental IT dollars. Data center systems alone grow 62.5% year over year to $822 billion.
Why did services lose budget share in 2026 without being cut?
Services spending rose from $1,492 billion to $1,570 billion, a 5.3% increase. The total market grew 14.2%. Any line growing slower than the total loses share arithmetically, so services fell from 26.75% to 24.65% of the global IT budget while its absolute spending increased. This distinction matters when a vendor reports flat share as a decline or a buyer reads share loss as a cut.
What percentage of revenue should a company spend on IT?
There is no authoritative public benchmark. The industry ranges in circulation come from proprietary advisory datasets built on self-selected client samples with inconsistent definitions of what counts as IT spending. If the figure is required, cite the specific source and its sample basis, and pair it with an internally computed ratio such as ITMR that can actually be audited.
Are IT budgets growing faster than headcount in 2026?
Substantially. Gartner’s CFO Budget Priorities survey found 75% of 303 finance leaders expecting technology budget increases in 2026, with 48% expecting 10% or more, while headcount growth expectations fell from 6% in 2025 to 2% in 2026. Technology spending is increasingly justified as a substitute for hiring rather than as support for it.
Why do worldwide IT spending figures differ between sources?
Because the scope boundaries differ. Gartner’s $6.369 trillion is vendor revenue across hardware, software, services, and communications services worldwide. The Bureau of Economic Analysis series used here is US private business capital investment in information processing equipment and software, which excludes communications services, most labor, and the operating expense portion of cloud. Neither is wrong; they answer different questions, and averaging them produces a figure that answers neither.
Which technology categories are government CIOs increasing in 2026?
Cybersecurity leads at 85% of government CIOs outside the US planning increased investment, followed by AI and generative AI at 80% each and cloud platforms at 76%. Separately, 74% have deployed or plan to deploy AI within twelve months, and 49% report current or planned AI agent deployment.
Has Gartner’s 2026 IT spending forecast been revised?
Four times. Gartner published 9.8% growth in October 2025, 10.8% in February 2026, 13.5% in April 2026, and 14.2% in July 2026. Every revision was driven upward by data center systems. When quoting a worldwide IT spending figure, state the forecast vintage, because the same year has carried four different totals in nine months.