Gartner Says Global IT Spending to Grow 6.2 Percent in 2018

Press release
Published April 23rd, 2018 - 07:27 GMT
John-David Lovelock, research vice president at Gartner
John-David Lovelock, research vice president at Gartner

Worldwide IT spending is projected to total $3.7 trillion in 2018, an increase of 6.2 percent from 2017, according to the latest forecast by Gartner, Inc.

"Although global IT spending is forecast to grow 6.2 percent this year, the declining U.S. dollar has caused currency tailwinds, which are the main reason for this strong growth," said John-David Lovelock, research vice president at Gartner. "This is the highest annual growth rate that Gartner has forecast since 2007 and would be a sign of a new cycle of IT growth. However, spending on IT around the world is growing at expected levels and is in line with expected global economic growth. Through 2018 and 2019, the U.S. dollar is expected to trend stronger while enduring tremendous volatility due to the uncertain political environment, the North American Free Trade Agreement renegotiation and the potential for trade wars."

Enterprise software spending is forecast to experience the highest growth in 2018 with an 11.1 percent increase (see Table 1). Barring unexpected disruption, the software industry is expected to continue capitalizing on the evolution of digital business. Application software spending is expected to continue to rise through 2019, and infrastructure software will also continue to grow, bolstered by modernization initiatives.

Table 1. Worldwide IT Spending Forecast (Billions of U.S. Dollars)

 

2017

Spending

2017

Growth (%)

2018

Spending

2018

Growth (%)

2019 Spending

2019 Growth (%)

Data Center Systems

181

6.3

188

3.7

190

1.1

Enterprise Software

352

8.8

391

11.1

424

8.4

Devices

663

5.1

706

6.6

715

1.3

IT Services

933

4.4

1,003

7.4

1,048

4.6

Communications Services

1,392

1.3

1,452

4.3

1,468

1.1

Overall IT

3,521

3.8

3,740

6.2

3,846

2.8

Source: Gartner (April 2018)

Even with a strong end to 2017, worldwide spending on data center systems is forecast to grow 3.7 percent in 2018, down from 6.3 percent growth in 2017.The longer-term outlook continues to have challenges, particularly for the storage segment. The strength at the end of 2017 was primarily driven by the component shortage for memory components, and prices have increased at a greater rate than previously expected. Whereas previously, component shortages were expected to ease into 2018, the shortages are now expected to continue throughout the year with the supply not expected to ease until the end of the year.

Worldwide spending for devices — PCs, tablets and mobile phones — is forecast to grow in 2018, reaching $706 billion, an increase of 6.6 percent from 2017. "The device market continues to see dual dynamics. Some users are holding back from buying, and those that are buying are doing so, on average, at higher price points," said Mr. Lovelock. "As a result, end-user spending will increase faster than units through 2022. However, total end-user spending and unit shipments are expected to be lower compared with previous forecasts, as demand for ultramobile premium devices, ultramobile utility devices and basic phones is expected to be slow."

Gartner's IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.

The Gartner quarterly IT spending forecast delivers a unique perspective on IT spending across the hardware, software, IT services and telecommunications segments. These reports help Gartner clients understand market opportunities and challenges. The most recent IT spending forecast research is available at Gartner Worldwide Spending Forecast. This quarterly IT Spending Forecast page includes links to the latest IT spending reports, webinars, blog posts and press releases.

Mr. Lovelock will provide further analysis on the key drivers of the IT market at the Gartner Tech Growth & Innovation Summit taking place from April 30 through May 2, 2018 in San Diego, CA. The Summit is the premier conference for technology vendors to learn about the latest trends and tools, innovation predictions, positioning and thought leadership.

Background Information

Gartner

Founded in 1979, we are the leading research and advisory company. We’ve expanded well beyond our flagship technology research to provide senior leaders across the enterprise with the indispensable business insights, advice and tools they need to achieve their mission-critical priorities and build the organizations of tomorrow.

Together with our clients, we fuel the future of business so that a more successful world takes shape.

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