US research firm Gartner predicts that IT spending in Europe will increase by 11% to a total of $1.4 trillion in 2026. Growth is expected to be driven by AI, cloud computing and cybersecurity, despite limited IT budgets and few new hires.

Spending on generative AI is expected to grow by 78%, while cloud investments will increase by 24% as companies increasingly move services to Europe for sovereignty reasons. Data center systems, meanwhile, are growing by almost 19 percent, with investment in AI-optimized servers expected to reach $46.8 billion. This compares to 67 billion for China and 170 billion for North America.

Meanwhile, Gartner predicts an increase in regional AI lock-in by 2027, when 35% of countries are expected to be tied to region-specific AI platforms, driven by regulation, security, and demands for national control over data.