A new report from Forrester forecasts global technology spending to grow by 5.6% in 2025, reaching an impressive $4.9 trillion—up from $4.7 trillion in 2024. This growth is attributed to several key factors, including the rapid adoption of software, IT services, generative artificial intelligence (genAI), and cloud technologies, with Asia Pacific and North America leading the charge.
Forrester’s Global Tech Market Forecast (2024 to 2029) indicates that software and IT services will collectively account for 66% of global technology expenditure in 2025. Investment in cybersecurity solutions and the modernisation of legacy systems are significant contributors to this trend. Notably, software alone is expected to grow at a remarkable rate of 10.5%, capturing 60% of the overall growth in tech spending by 2029, making it the fastest-growing sector in the technology landscape.
The Forrester report highlights that generative AI will play a crucial role in driving industry-specific growth. Sectors such as financial services, retail, and media are increasingly adopting AI-enabled tools to enhance customer experiences and improve operational efficiency. This surge in investments in genAI will compel businesses to rethink their workforce strategies, compete for tech talent, and address technical debt.
The Asia Pacific region is set to experience a tech spend increase of 5.6% in 2025, driven by a surge in real GDP growth that surpasses the global average. Countries like India, the Philippines, Vietnam, and Indonesia are expected to lead this growth. Government initiatives in China and India, along with heightened investments in generative AI and semiconductors in Japan and South Korea, will further bolster the region's tech expenditure. India is projected to experience the fastest growth, with an anticipated increase of 9.6% in tech spend in 2025.
Michael O’Grady, principal forecast analyst at Forrester, remarked, “Over the next five years, technology investments will reshape industries at an unprecedented pace.” He stressed that companies prioritising investments in genAI, cloud technologies, and cybersecurity will enhance their competitive edge and achieve sustainable growth. However, he also cautioned that balancing rapid tech investments with the management of legacy systems and technical debt is essential for long-term success.
