2026 Tech Outlook
Explore the latest shifts in technology with our sector insights report. The report focuses on four key areas shaping the technology landscape as we enter 2026.
Resilient global demand into 2026 after strong growth in 2025
We are bullish on the overall Technology Sector into 2026. Technology spend continues to scale globally. Gartner forecasts worldwide Information Technology (IT) spending of c. $6.1tn in 2026, 9.8% up y/y. Datacentre systems are expected to grow by 19% following extremely strong demand in 2025 (+46.8%). Core IT Spending is expected to rise by 12.5% to $3.89tn; which includes an incremental $93bn in data centre spend and an additional $431.7bn in core IT spend (systems; software; IT Services) potentially linked to software upgrades relation to next generational technology such as generative artificial intelligence (GenAI) with the cost of software on the rise.
Hyperscalers dominate AI capex spend; Evidence of continued demand
Analysing the major hyperscalers, the direction of travel for AI capex spend continues to rise universally. Among the top 5 being Amazon, Meta, Google, Microsoft and Oracle, an accumulated spend of $241bn in AI capex in 2024, is set to rise to more than $620bn by the end of 2028 marking a 4-year Compound Annual Growth Rate (CAGR) if just over 26%. Supply is not currently close to matching demand levels at this stage.
Cybersecurity segment continues to consolidate
There is a need to simplify the tool structure within the enterprise amongst Chief Technology Officers (CTOs) and Chief Information Security Officers (CISOs) with centralised management. This is driving significant acquisition demand in the top tier of the industry to have a platform suite to remain relevant at the enterprise end such as firewall, endpoint, cloud security. This is counter to a best of breed approach prevalent for the last number of years where companies chose the best tools on the market for each function. The recent examples include the Google acquisition of Wiz ($32bn) aiding cloud security skillsets for its clients, the Palo Alto Networks acquisition of CyberArk. Other areas like Data Security Posture Management and AI security are attractive to buyers given the underlying growth dynamics. AI is becoming an important part of the tool stack and organisations are actively deploying it to counter day zero attacks.
Software Services industry continues its growth curve
Vendors in the software space with large platform relationships and significant vendor breadth are performing strongly. There are still high levels of fragmentation. Changes in incentive structures such as the Microsoft changes have led to short term instability in terms of renewals. We continue to see increased specialisation entering the sales function and companies continuing to move towards a sector and size specific sales model both with its vendors. The key areas of demand appear to be cloud migration; cyber consulting and AI but we do note that AI related revenues are still more subdued than initial expectations.