Security, AI, and IoT to drive robust IT spend in 2H25, Piper Sandler says
Investing.com -- Piper Sandler’s latest CIO survey shows IT spending remains on solid footing heading into the second half of 2025, with Security, IoT, and AI infrastructure standing out as the top priorities.
“IT budgets are still projected to accelerate,” the analysts wrote, with growth estimates of 3.4% in 2025 and 4.8% in 2026, despite a slight dip from previous forecasts.
The survey found 85% of CIOs expect IT budgets to rise in 2025, “pointing to budget durability and potentially a slight acceleration heading into 2H25.”
Security and IoT/Device Connectivity ranked as the highest investment areas, with 93% and 82% of CIOs planning net increases, respectively, according to Piper.
AI infrastructure was also a clear standout: “93% of respondents plan to increase spend on AI infrastructure with no plans to decrease,” Piper Sandler said, with 48% planning material increases of 25% or more.
The firm highlighted Microsoft (NASDAQ:MSFT) Azure and Oracle (NYSE:ORCL) Cloud Infrastructure as seeing the biggest gains in spending intent.
Among AI apps, Piper said that OpenAI and Microsoft Copilot remained leaders, but Adobe (NASDAQ:ADBE) Firefly’s intent doubled to 20%.
Notably, “more than half now see AI as a potential drag on headcount for the first time.”
An infrastructure refresh is also gaining traction. “20-30% of respondents expect refresh on Firewalls before year-end,” with Backup and Switching identified as other strength areas.
Still, enthusiasm for broad software investment is fading. “Less than 10% plan to materially invest (25%+) in application software,” Piper Sandler noted, although Microsoft and SAP remain standouts.
The report also pointed to a growing shift away from VMware, with more CIOs indicating plans to move off the platform at the next renewal.
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