Global spending on artificial intelligence (AI) is projected to reach $2.7 trillion in 2026, representing a 49.5% increase from the previous year, according to a report by Gartner. This significant growth is driven by the increasing demand for AI infrastructure, including AI-optimized IaaS, servers, network fabric, processing semiconductors, and devices. The strong demand for AI infrastructure is expected to remain inelastic to pressures from memory-related pricing increases.
The buildout of AI data center capacity is considered the largest infrastructure project humanity has ever undertaken. Hyperscalers and service providers are investing heavily in AI-optimized servers, which is expected to be the largest single area of spending. John-David Lovelock, distinguished VP analyst at Gartner, attributes the growth to the increasing demand for AI infrastructure to support anticipated future workloads.
In the software market, vendors are rapidly embedding agentic AI within their existing products to maintain relevance and defend against new cross-functional agents. With GenAI firmly in the Trough of Disillusionment in 2026, enterprises are leveraging simpler embedded AI features from incumbent software providers to improve operational efficiency, automate workflows, enhance customer engagement, and decision-making.
Enterprises are turning to service providers less often for business transformation and more often for smaller indirect projects to exploit AI features of their incumbent software systems. Lovelock notes that the risks associated with vendor lock-in, data sovereignty, and runaway costs are not deterring buyers from adopting proprietary capabilities. The combination of transformation and indirect projects is forecast to drive a $1.2 trillion opportunity in AI services by 2030.
The short-term outlook for AI application development platforms has increased from 28% growth in 2026 to 39% in the current forecast. Enterprises, software providers, and services firms are seeking to develop custom AI applications tailored to their individual needs. This growth is driven by the increasing demand for AI solutions that can address specific business requirements.
The AI market is witnessing significant investments in infrastructure and software, with a focus on developing custom AI applications. The growth in AI spending is expected to have a profound impact on various industries, enabling businesses to improve operational efficiency, enhance customer engagement, and drive innovation. As AI continues to evolve, it is likely to play an increasingly critical role in shaping the future of businesses.
According to Gartner, the AI market is expected to continue growing, driven by the increasing demand for AI solutions. The growth in AI spending is a testament to the importance of AI in driving business innovation and transformation. As businesses continue to invest in AI, it is likely to have a significant impact on the global economy, enabling companies to improve efficiency, productivity, and competitiveness.
Key points
- Global AI spending is forecast to reach $2.7 trillion in 2026, a 49.5% increase year-over-year.
- The buildout of AI data center capacity is considered the largest infrastructure project humanity has ever undertaken.
- The AI market is expected to drive a $1.2 trillion opportunity in AI services by 2030.
