This is Stanton Jones and Steve Hall with a special preview edition of the ISG Index Call on Thursday, July 10 at 9:00 AM ET. Make sure to reserve your spot here.
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Caution Reigns, But Big Deals and AI Roll On
While business uncertainty has eased somewhat since the first quarter, it’s still elevated compared to historical norms. This continues to put pressure on discretionary technology spending and delay decision-making. At the same time, it is driving strong demand for AI-led cost optimization.
Here’s what you need to know leading into our 2Q25 call:
- Discretionary technology spending remains tight, which is putting pressure on smaller awards. Read more.
- This is impacting applications-related work, which makes up the majority of the annual contract value (ACV) in the market. Read more.
- In response, hiring in the IT and business services sector has slowed dramatically, a trend that is likely to continue for the balance of 2025. Read more.
- However, transformation-led cost optimization continues to be strong, which is resulting in robust large-deal activity. Read more.
- Though global capability center (GCC) activity continues to be robust, GCCs are increasingly struggling to integrate with headquarters. Read more.
- Data-related programs continue to accelerate despite flat IT budgets and macroeconomic uncertainty. Read more.
- However, concerns around AI governance and security, combined with the lack of a unified data strategy are increasingly barriers to scaling AI beyond pilots. Read more.
Reserve your spot here.
About the authors
Stanton Jones
Stanton helps enterprise technology leaders, IT service providers and buy- and sell-side professionals make sense of the global IT services sector. Stanton's weekly briefing - the Index Insider - is read by thousands of industry stakeholders each week.
Steve Hall
Steve is President, ISG EMEA, providing strategic insight and advice to help ISG clients in the region solve their most critical business challenges and adopt and optimize the technology and operating models they need to compete successfully.
Steve was named Chief AI Officer in 2024. He leads the firm’s work to help clients create an AI strategy, establish a business case for investment and select the right business partners. His industry-leading expertise in navigating the complexities of adopting technology at scale is helping clients drive value into every aspect of their operations.
Steve joined ISG in 2005 and has led ISG Digital Advisory Services, Emerging Technology Services, Global Product Engineering and Application Development & Maintenance. He is trained as a software engineer and holds a bachelor’s degree in computer science from Regis University.
