Gartner: IT Spending Expected to Grow 8% in 2024

Worldwide IT spending is likely to grow 8% to $5.06 trillion this year, according to Gartner’s 2024 IT spending forecast. Data center systems and software are the segments expected to drive that growth the most.

Gartner made its predictions by analyzing sales of IT products and services across hardware, software, IT services and telecommunications segments. The analyst firm researches over 1,000 vendors and maintains a quarterly database of market size data.

Generative AI plans push IT to beef up data center services

The amount of money spent on data center services is predicted to jump 10% to $260 billion from $236 billion in 2024 (Figure A). Many enterprises Gartner has spoken to say they plan to roll out generative AI products, services and use cases in 2025, which requires greater spending on data centers. Gartner saw 10% growth year-over-year in data center spending.

Figure A

Table showing that Gartner predicts worldwide IT spending on data center systems will accelerate the most compared to all of the segments the firm tracks.
Gartner predicts worldwide IT spending on data center systems will accelerate the most compared to all of the segments the firm tracks. Image: Gartner

“There is also gold rush level spending by service providers in markets supporting large scale GenAI projects, such as servers and semiconductors,” John-David Lovelock, distinguished vice president analyst at Gartner, stated in the press release.

Mobile device spending recovers within short generation cycles

While data center spending increased, device spending fell in 2023 and recovered slightly from $664 billion to $688 billion in 2024, showing 3.6% growth. The cause for growth might instead be an accelerating refresh cycle, with more phone enterprises and consumers replacing phones more quickly.

“Business and consumers were happy to keep their devices for longer – reducing the number of devices bought even year simply as a replacement to the devices currently owned,” Lovelock told TechRepublic by email. “2024 marks a turnaround year, and device sales are increasing of the prior year.”

The inclusion of generative AI on some phone brands isn’t behind this change, but “sustains” it, Gartner pointed out.

“The AI features (NPU and TPU chips) built into smartphones and PC are insufficient to cause business and consumers to refresh their devices,” Lovelock told TechRepublic. “Without a breakthrough application that runs natively on the device and requiring AI capability, AI capability is a ‘nice to have’ that will help sustain replacements and upgrades without requiring them.”

Hiring money pivoting toward IT service firms

More money is being spent on consulting firms than on internal staff in IT for the first time Gartner has seen, said Lovelock.

That’s because “Enterprises are quickly falling behind IT service firms in terms of attracting talent with key IT skill sets,” Lovelock is quoted as saying in the press release. “This creates a greater need for investment in consulting spend compared to internal staff.

SEE: In Australia and New Zealand, IT spending growth will be driven by cybersecurity, cloud and data, Gartner found.

“With spending on IT services on track to grow by 9.7% to eclipse $1.52 trillion, this category is on pace to become the largest market that Gartner tracks,” said Lovelock in the press release.

Spending trends in software and communications services

The other segments in the IT spending forecast as tracked by Gartner, and their predicted growth in 2024 are:

  • Software, 13.9%.
  • Communications services, 4.3%.
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