Gartner: Australian IT spending forecast to top $192 billion in 2027

Australian IT spending is on track to exceed A$192.2 billion in 2027, an 8.7% increase on 2026, according to research and advisory firm Gartner.

The figures were released during Gartner IT Symposium/Xpo on the Gold Coast this week, with the firm pointing to enterprise AI adoption as the primary force reshaping how organisations allocate technology budgets.

"Business leaders are moving beyond isolated use cases and investing in the infrastructure and software ecosystems required to embed AI across the enterprise," said Neil Osmond, distinguished VP analyst at Gartner.

"This is driving a long-term reallocation of technology spending toward capabilities that can deliver agility, productivity and innovation at scale."

Infrastructure as a service (IaaS) is forecast to record the fastest growth of any category, rising 22.1 per cent to A$9.1 billion in 2027. Gartner attributed this primarily to AI-optimised IaaS, which it projects will grow 58.5% in the same year.

Data centre systems are expected to grow 16.6% to A$14.6 billion in 2027, with server spending up 19.7% as service providers and hyperscalers invest in AI-optimised hardware to support generative AI workloads.

"The rapid growth in AI-optimised servers and data centre systems spending in Australia is part of the global AI infrastructure roll-out, which is the largest infrastructure project ever attempted," said John-David Lovelock, distinguished VP analyst at Gartner.

"This new capacity will support the AI model and agent workloads required by organisations as they scale AI capabilities across the enterprise."

Software will remain the single largest IT spending category in Australia, with Gartner forecasting it to exceed A$68 billion in 2027 - a 13.3% increase from 2026.

Lovelock said the growth is largely driven by the addition of generative AI models and agentic AI capabilities to existing cloud software platforms, with CRM and analytics identified as early high-impact segments.