Europe’s IT spend to surge 11% as cloud sovereignty fever takes hold

Steven

Europe’s IT spend to surge 11% as cloud sovereignty fever takes hold

Summary

Gartner forecasts that IT spending in Europe will grow 11% in the year ahead, pushing the market to about $1.4 trillion as organisations prioritise AI, cybersecurity and cloud sovereignty. Spending is projected to reach $1.3 trillion by the end of 2025 after an 11.6% rise that year. Investment in generative AI model usage is expected to jump about 78% as companies pour money into AI, cloud and security capabilities.

Concerns about geopolitical risk and digital sovereignty are driving Western European CIOs to favour local cloud providers: a recent Gartner survey found 61% want to boost use of local clouds and 53% expect geopolitics to constrain use of global providers. Gartner analyst John-David Lovelock describes a move towards “geo-repatriation” — buying technology closer to home to manage risk.

Hardware and infrastructure trends are mixed: datacentre spending is rising sharply now (projected to grow 38.2% in 2025 to $83.6bn) then moderate (growth forecast at 18.8% the following year as spend reaches $99.3bn). Large-scale AI infrastructure investment remains concentrated in North America, even as European organisations ramp up related spending.

Key Points

  • Gartner predicts an 11% increase in European IT spending next year, taking the market to roughly $1.4tn.
  • Europe’s IT market will hit about $1.3tn by end-2025 after an 11.6% rise during 2025.
  • Spending on generative AI models is expected to surge ~78% as organisations invest in AI capabilities.
  • Cloud sovereignty is a major driver: 61% of Western European CIOs want to increase use of local cloud providers; 53% foresee geopolitics limiting global cloud use.
  • Datacentre spending is rising fast now (38.2% in 2025 to $83.6bn) then slowing to 18.8% growth the following year ($99.3bn).
  • Major AI infrastructure build-out remains concentrated in the US, though Europe is increasing related investments.

Why should I read this?

Short version: if you buy cloud, run datacentres, or sign off AI budgets, this matters. Europe is splashing cash — especially on AI and security — but it’s doing so with one eye on geopolitics and a new taste for local cloud suppliers. Read this to know where the money’s going and why vendors and procurement teams should rethink partnerships and sovereignty risks. We’ve done the heavy lifting so you can act faster.

Source

Source: https://www.theregister.com/2025/11/14/it_spending_europe/