Monday Morning Impact – May 11

Worldwide IT spending is expected to reach $6.31 trillion in 2026, up 13.5% from 2025, according to the latest forecast by Gartner.

Data center systems spending is set to see the largest growth in 2026 at 55.8%. IT services, including application implementation and managed services, infrastructure implementation and managed services and IaaS, are forecast to see the largest overall spending, surpassing $1.87 trillion in 2026.

“Robust demand combined with supply constraints has resulted in record price increases for high-bandwidth memory,” said John-David Lovelock, Distinguished VP Analyst at Gartner. “This surge positions the memory segment as a lucrative area for semiconductor manufacturers. These trends collectively make AI infrastructure the most attractive segment for capitalizing on the robust expansion in IT spending.”

Compared to Gartner’s previous forecast, Gartner is predicting a stronger‑than‑anticipated growth in global IT spending, driven by sustained momentum across AI infrastructure, software, and IaaS. These shifts are reinforcing a multi‑speed IT market, with hyperscaler purchases and AI‑centric software segments significantly outperforming more traditional categories.

Hyperscale cloud demand is fueling a sharp increase in server and data center investment, with spending on data center systems projected to surpass $788 billion in 2026 with growth accelerating well beyond prior expectations. At the same time, GenAI continues to drive outsized gains in software, particularly in GenAI model development, where spending growth is forecast to more than double year-over-year.

Device spending is also rising, reaching an estimated $856 billion, though growth is being moderated by higher memory costs that are lifting average selling prices and constraining replacement cycles in lower‑margin segments.

“Together, these dynamics highlight a widening divergence across IT markets, as AI infrastructure and GenAI software see substantial upward revisions while device growth reflects ongoing cost and pricing pressures,” added Lovelock.

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. More information on the forecast can be found in the complimentary Gartner webinar IT Spending in 2026: Pruning the AI Garden.

Channel Impact^®
The data underscore key market opportunities available to channel partners of all types.

Writer, a San Francisco-based company with an enterprise level AI agent platform, has released a new report examining the obstacles faced by companies as they implement generative and agentic AI. According to the study, 79% of executives acknowledge struggling with issues like lagging ROI, strategy gaps, and internal power struggles. The pressure is felt most acutely at the top, with 38% of CEOs reporting a high or crippling amount of stress around AI strategy. Meanwhile, 64% of CEOs fear they could lose their job if they fail to lead their organization through the AI transition.

To get ahead in the AI race, 92% of the C-suite admits they’re actively cultivating a new class of “AI elite” employees. Most leaders (87%) report that these AI super-users are at least 5X more productive than employees who aren’t embracing AI. But the stakes are high for those who lag behind, as 77% of executives warn that employees who refuse to become AI-proficient won’t be considered for promotions or leadership roles, and 60% plan to lay off employees who can’t or won’t use AI.

Nearly all executives (97%) say AI has been beneficial, and 75% believe AI agents will be part of their company’s C-suite within the next 5 years. Still, few leaders say they’ve seen significant ROI from generative AI (29%) or AI agents (23%), and nearly half (48%) feel that AI adoption at their company has been a massive disappointment.

More than two-thirds (69%) of the C-suite report that their company is doing layoffs due to AI, but 39% admit they don’t have a formal strategy in place to drive revenue from AI tools. Even where strategies do exist, quality is lacking — 75% of executives say their company’s AI strategy is more for show than for actual internal guidance.

As pressure from boards intensifies, internal friction is growing. Fifty-four percent of the C-suite respondents say adopting AI is tearing their company apart, and 56% say this has created power struggles and disruption at their organization — double digit increases from 2025. Meanwhile, 78% of executives say AI has created tension between IT and other lines of business, with 55% reporting that AI use is a chaotic free-for-all at their company.

Research findings are based on a survey conducted between December 17, 2025, and January 25, 2026. The survey included 2,400 knowledge workers spanning nearly 30 industries across the US, UK, Ireland, Benelux, France, and Germany, including 1,200 C-suite executives and 1,200 employees that use generative AI tools.

Channel Impact^®
The current times are seen as a defining moment in AI adoption, as the gap between super-users and laggards is widening quickly.