AI’s Impact on Technology Services Revealed in New ISG AI Index™
Geopolitical turmoil is rattling the world’s economies, but for the technology services sector, there’s no slowing down—not with the power of AI filling the industry’s sails.
ISG Index™
The authoritative source for market intelligence on the global IT and business services industry.
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NEW FROM ISG
Introducing the ISG AI Index™
AI is reshaping the global technology services sector. The question is how much, where and who is capturing the value. The ISG AI Index™ is a new benchmark that measures AI’s commercial impact across infrastructure, software, and managed services — anchored to December 2022, the start of the current AI era, and updated each quarter alongside the ISG Index.
How the Index Is Constructed
Infrastructure (IaaS)
Capital expenditure
Measures how much capacity hyperscalers are building ahead of demand.
Software (SaaS)
cRPO
Current remaining performance obligations — revenue sold but not yet recognized, one of the clearest signals of forward demand.
Managed Services
Revenue per employee
Tracks how AI is beginning to change workforce productivity across the services sector.
Inaugural Results
+77% Market-weighted ISG AI Index since inception in December 2022
- IaaS has captured the first wave of AI value, driven by hyperscaler capital investment at a scale the industry has not seen before.
Revenue +100% · Profitibility +60% · Stock +113% · CapEx +265% - SaaS is monetizing next, with revenue and backlog both growing ahead of profitability as the market works through AI pricing and economics.
Revenue +61% · Profitability +18% · Stock +39% · cRPO +71% - Managed services is flat on the composite, but productivity indicators are moving. The bigger impact on services is still ahead.
Revenue +8% · Profitability +4% · Stock -36% · Revenue/employee +8.5% - Revenue growth is running ahead of profitability in every segment. AI is showing up in top-line results before it reaches margins.
The ISG AI Index is released quarterly during the ISG Index webcast. The full methodology can be accessed here.
Join the quarterly ISG Index webcast to for the full ISG AI Index rundown.
The Latest from the ISG Index
Market Level Set
- Managed services remain steady as TCO deals proliferate.
- SaaS growth stays positive despite fears of AI-led disruption.
- IaaS growth continues to accelerate while capital spending surges.
- Enterprise AI demand remains exceptionally strong.
- 2026 outlook: managed services steady, XaaS accelerates.
About ISG Index
The ISG Index is the authoritative source for marketplace intelligence on the health and growth of the global IT and Business Services Sector. Using our unprecedented data assets, as well as our practitioner-led view into the industry, the Index research program provides investors, service providers, technology vendors and enterprise technology leaders with the most up-to-date view into key changes in demand, pricing, talent and provider landscapes.
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