Gartner has updated its AI spending forecast, extending the projection to 2027 and removing 2024 from the view, as it now lies more than a year in the past. This latest release offers less detail than the comprehensive breakdown provided in September, a shift that limits the depth of analysis for industry observers who value granular insights. Still, the updated data reveals powerful trends shaping the future of IT spending. Compared to the earlier forecast, Gartner now presents a more aggregated view of AI spending, combining infrastructure, software, services, and tools into broader categories. While this reduces the ability to isolate specific components like datacenter hardware or client devices, it underscores the accelerating integration of AI across the entire IT landscape. AI infrastructure spending is expected to nearly double between 2025 and 2027, though growth will slow slightly in 2027 compared to 2026. This pace remains remarkably fast—comparable to Moore’s Law—driven by rising demand for GPU and XPU-powered servers, which already account for about half of datacenter revenue. As AI becomes more embedded in computing, the line between general-purpose servers and AI-optimized systems will blur, making it harder to track where inference tasks are actually running. AI software spending is also on a similar trajectory, nearly doubling over the same period. Much of this growth comes not from entirely new applications, but from embedding AI capabilities into existing systems—middleware, databases, and enterprise software. This mirrors the historical pattern seen with server virtualization and cloud computing, where technologies become so ubiquitous they no longer stand out as distinct categories. Even more striking is the growth in AI-specific tools. Sales of AI models, data science platforms, development tools, and AI security solutions are rising faster than infrastructure or software. Tools for securing AI systems—often powered by AI itself—and AI data management platforms are expanding rapidly from smaller bases, signaling a maturing ecosystem. According to Gartner, AI spending accounted for 31.7% of total IT spending in 2025. The forecast projects that share will climb to 41.5% in 2026. While Gartner has not yet released a full IT spending forecast for 2027, a reasonable projection suggests AI could drive half of all IT spending by then. This shift reflects not just rising investment in AI, but a broader transformation: as AI becomes standard, it stops being a separate category and simply becomes part of core IT operations. Meanwhile, non-AI IT spending is expected to decline slightly each year, while AI continues to grow. The result is a stark contrast in datacenter dynamics—the best of times for AI infrastructure, the worst for legacy systems. The IT sector as a whole will grow, but almost entirely due to AI’s relentless expansion.