IT spending in Europe is expected to reach $1.4 trillion in 2026, according to a new forecast from Gartner. This would represent an 11.1% increase from the projected $1.3 trillion in 2025. Gartner states that European organisations plan to increase spending on software, cloud services and cybersecurity in 2026. According to John-David Lovelock, Distinguished VP Analyst at Gartner, CIOs are allocating more budget to software as providers introduce new AI functions. Gartner expects end-user spending on generative AI models in Europe to rise by 78.2% in 2026.
Lovelock said cloud spending in Europe is likely to fluctuate as organisations consider data sovereignty requirements and shift some cloud workloads to regional providers. Gartner forecasts public cloud services spending to grow 24% in 2026. Gartner reported that software will remain a top spending category in 2026, driven in part by price increases across software segments. The firm’s forecast shows all major IT categories expanding next year. Device spending is set to grow as manufacturers add AI-related components and adjust pricing.
According to Gartner, the development of AI infrastructure will continue to increase demand for servers, including systems designed for AI workloads. In Europe, spending on AI-optimised servers is expected to reach $46.8 billion in 2026, up from $39.3 billion in 2025. This compares with projected spending of $170 billion in North America and $67 billion in China.
Lovelock said European countries are responding to regulatory and geopolitical pressures by prioritising the ability to develop and run AI systems within the region. He noted that software providers are incorporating generative AI features into existing products, while regional AI platforms are being positioned as part of national infrastructure.
Gartner predicts that by 2027, 35% of countries will be using region-specific AI platforms based on proprietary contextual data. The firm expects platform lock-in to rise from 5% today to 35% in 2027, driven by government efforts to ensure that cloud providers work with domestic partners to comply with regulatory and strategic requirements.
Gartner’s forecast is based on analysis of sales data from more than one thousand technology vendors, combined with primary and secondary research. The quarterly forecasts provide revenue outlooks for hardware, software, IT services and telecommunications.
