Piper Sandler: IT Spending to Remain Resilient in 2H25, Led by Security, AI, and IoT
According to Piper Sandler’s latest survey of Chief Information Officers, IT spending is expected to remain robust heading into the second half of 2025, with cybersecurity, IoT/device connectivity, and AI infrastructure emerging as top priorities.
“IT budgets are still projected to accelerate,” the analysts noted, projecting spending growth of 3.4% in 2025 and 4.8% in 2026 — slightly below earlier estimates but still strong overall.
The survey revealed that 85% of CIOs anticipate increased IT budgets this year, signaling both resilience and a possible uptick in spending momentum in the second half.
Cybersecurity and IoT are leading the investment focus, with 93% and 82% of respondents, respectively, planning net spending increases in these areas.
AI infrastructure also stands out as a major growth category. Piper reported that 93% of CIOs expect to boost AI-related infrastructure spending, with nearly half (48%) aiming for significant increases of 25% or more.
Microsoft Azure and Oracle Cloud Infrastructure are seeing the strongest upward trends in budget allocations, according to the report.
In the realm of AI applications, OpenAI and Microsoft Copilot continue to dominate, while interest in Adobe Firefly doubled to 20% among respondents.
For the first time, more than half of CIOs now see AI as a potential factor reducing headcount, reflecting a shift in workforce impact expectations.
Meanwhile, infrastructure upgrades are gaining momentum. Between 20–30% of respondents expect to refresh firewalls before the end of the year, with backup systems and network switching also cited as areas of strength.
However, enthusiasm for broad application software investment is cooling. Fewer than 10% of CIOs plan to significantly boost spending (25% or more) in that category, though Microsoft and SAP continue to stand out as preferred vendors.
The report also notes a growing move away from VMware, with more IT leaders signaling plans to exit the platform during upcoming contract renewals.
