Gartner’s July 2026 update to its worldwide IT spending forecast lifted the projected growth rate for application development spending from 28% to 39% for the year — one of the largest upward revisions in the report. The driver, according to Gartner’s own analysis, is enterprises building custom AI applications faster than earlier forecasts assumed, combined with rising demand to track and prove the return on that spend once it’s live. Overall worldwide IT spending is now forecast at $6.37 trillion for 2026, up from an earlier $6.15 trillion estimate, with AI software spending alone on track to grow 60% this year and a further 41% in 2027.
Forecasts get revised upward when the underlying activity is already happening faster than analysts assumed — this isn’t a projection of future demand, it’s a correction to catch up with demand that’s already arrived. Enterprises aren’t just experimenting with AI coding tools anymore; they’re commissioning production custom software built around AI capability, and doing it at a pace that outstripped Gartner’s own numbers from earlier in the year.
So what
If your organisation has been treating a custom AI-enabled application as a “maybe next year” project, the market data suggests you’re behind a growing share of your peers, not ahead of the curve by waiting. The harder part isn’t deciding to build — it’s choosing the right scope, the right AI capability to embed, and a delivery partner who can prove the return Gartner says boards are now demanding usage data for. That’s exactly the brief behind our AI-assisted development and custom software development work — get in touch if you’re scoping a project for the year ahead.