Worldwide IT spending is expected to total $5.26 trillion in 2024, an increase of 7.5% from 2023, according to the latest forecast by Stamford-based Gartner, Inc. This was a decrease from the previous quarter’s forecast of 8% growth, but an increase of the overall spend forecast of $5.06 trillion, it said.

“The change fatigue in CIOs that we saw at the start of the year has now abated and the contract backlogs going back to the third quarter of 2023 are being cleared. We expect to see a larger rush towards the end of the year to make up for the slow start,” said John-David Lovelock, VP and Analyst at Gartner.

He said Generative AI (GenAI) was being felt across all technology segments and subsegments, but not to everyone’s benefit.

“Some software spending increases are attributable to GenAI, but to a software company, GenAI most closely resembles a tax. Revenue gains from the sale of GenAI add-ons or tokens flow back to their AI model provider partner, “ he added.

Gartner outlook further said sending on data center systems was expected to increase 24% in 2024, up from the previous quarter’s forecast of 10% growth.

“The compute power needs of GenAI are being felt across the data center, and spending in that segment reflects this ravenous demand,” opined Lovelock.

Gartner, however, reported IT services spending was projected to grow 7.1% in 2024, down from 9.7% within the last forecast, due in part to slower spending across subsegments that include consulting and business process services.”

Gartner’s IT spending forecast methodology relied heavily on rigorous analysis of the sales by over a thousand vendors across the entire range of IT products and services.