Despite nearby conflicts and lower budget increases than their North American colleagues, European CIOs are making strong investments toward a more resilient, flexible, and revenue-generating IT department. Median budget increases in Europe are only 2.0% compared to 3.0% in our main study, but it is perhaps more important to see what CIOs are investing in than how much their budgets are growing.
As shown in Figure 1-9 from the free executive summary of our European IT Spending and Staffing Benchmarks 2025/2026 study, the top IT initiatives include data analytics/business intelligence, artificial intelligence (AI), and modernizing legacy systems.
To determine these priorities, we subtract the number of companies reducing their budget in each area from the number of companies increasing their budget. Only 3.0% of companies are lowering their data analytics budgets, with 73.0% increasing them, for a net of 70.0%. A net of around 63.0% of companies are increasing their IT spend on AI.
Even the fourth priority, data center automation, highlights the CIOs’ goal of moving from a people-driven organization to a technology-driven IT department. The priorities are simplifying access to data, streamlining decision-making, facilitating easier reporting, removing the restrictions and poor UI of legacy systems, and reducing barriers between the business and the customer. At the heart of it all lies the shift toward AI.
“In both Europe and North America, IT leaders are making way for AI,” said David Wagner, senior research director at Avasant. “They are doing this either through direct investment or by making it easier for AI to access data and the infrastructure.”
Our European IT Spending and Staffing Benchmarks 2025/2026 study is based on a detailed survey of more than 300 IT executives in Europe on their IT spending and staffing plans for 2025/2026. The study provides IT spending and staffing benchmarks for small, midsize, large, and very large organizations and for 33 sectors and subsectors. These include six new sectors/subsectors, namely, telecommunications, commercial real estate, paper and packaging, aerospace and defense, software and technology, and logistics. A description of the study’s metrics, design, demographics, and methodology can be found in the free executive summary.
This Research Byte is a brief overview of the findings in our report, European IT Spending and Staffing Benchmarks 2025/2026. The full 39-chapter report is available at no charge for Avasant Research clients.
