Times are changing rapidly, but analysts at Gartner forecast IT spending will still increase in 2023, albeit lower than previously expected.
Just three months ago, featured Gartner VP analyst John-David Lovelock advance notice IT spending is ‘recession proof’ because industry leaders are increasing IT budgets. The economic turmoil in October “is not expected to have a significant effect on overall corporate technology spending,” Lovelock said.
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But when the big tech companies started cut workGartner has now published a lower forecast for 2.4% growth in enterprise IT spending in 2022. It has reverted back to its $4.66 billion prediction for 2023 to 4. .49 billion dollars.
Gartner also now estimates total IT spending in 2022 at $4.39 billion, marking a 0.2% decline in 2021.
Looking ahead, the analyst made several predictions about where the money could be invested in the next 12 months: more software and services, fewer devices.
Lovelock makes a distinction between B2C and B2B spending on IT, but reiterates his argument that IT remains recession-proof. B2C companies are laying off employees as inflation wreaks havoc on the consumer market, but he asserts that “businesses continue to increase spending on digital business initiatives despite the global economic downturn,” he said. gender.”
“A turbulent economy has changed the landscape of business decisions and can cause CIOs to become more hesitant, delaying decisions or re-prioritizing. We’ve seen it happen. This is reflected in the reshuffle taking place among some B2B companies, especially those that are overinvested in growth.However, IT budgets are not driving these changes and spending. for IT remains unaffected by the economic downturn,” Lovelock said.
It remains to be seen whether Gartner’s claim that enterprise IT spending is resilient to a recession will be tested if and when the US and the rest of the world actually enter a recession. .
dismissal notice on Wednesday, Microsoft Director Satya Nadella said Customers accelerating spending during the pandemic are now looking to “optimize their digital spending to do more for less”.
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“We also see institutions in every industry and geography being cautious as some parts of the world are in recession and others are anticipating it,” Nadella noted.
Even Amazon Web Services reported slower revenue growth in the third quarter of 2022, as well as falling profit margins. Amazon CFO Brian Olsavsky said Amazon experienced wage inflation in 2022, particularly in AWS and higher energy prices. According to CNBC, Olsavsky said in October that AWS has “seen an increase in the number of AWS customers focused on controlling costs.”
