Business of Tech: Daily 10-Minute IT Services Insights

Small Business Confidence Dips Amid Inflation; IT Spending to Exceed $6 Trillion by 2026

Oct 27, 2025

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Small business confidence has declined as inflation concerns rise, with 71% of owners expressing worries about ongoing price increases, according to the latest CNBC SurveyMonkey Small Business Index. This marks an increase from 66% in the previous quarter, indicating a cautious approach to spending among small business owners. The report highlights that 24% of these owners view rising prices as the greatest risk to their operations, prompting a need for strategic adjustments in pricing and customer engagement to mitigate inflationary pressures.

In parallel, Gartner projects that global IT spending will exceed $6 trillion by 2026, driven primarily by investments in data center systems and software, particularly in response to the growing demand for artificial intelligence (AI) services. Despite the anticipated growth rate of 9.8% year-over-year, challenges remain, including constraints on computing resources and governance tasks. Gartner's analysis suggests that while organizations are currently experiencing disillusionment with generative AI, its integration into existing enterprise software is becoming more prevalent, shifting the focus from speculative investments to cost-cutting and efficiency improvements.

The Kanata Report reveals that nearly half of the surveyed office technology dealers offer managed IT services, yet these services account for only 7.6% of overall dealer revenue. Among those engaged in managed IT, 73% reported an average revenue increase of 28.8%. This indicates that while there is potential for growth in managed IT services, many dealers are not fully capitalizing on this opportunity. Additionally, concerns about a potential AI bubble are discussed, with analysts suggesting that managed service providers (MSPs) may not be significantly affected, as major AI innovations are primarily driven by large corporations.

For MSPs and IT service leaders, the current landscape emphasizes the importance of specialization and collaboration in a competitive market. With 75% of partners identifying these as top priorities, it is crucial for providers to differentiate themselves and focus on specific verticals. The findings suggest that while optimism remains high, particularly in regions like Latin America, actual revenue growth is slowing. MSPs should benchmark their performance, leverage distributor partnerships, and prioritize delivering measurable outcomes to navigate the evolving market effectively.

Four things to know today

00:00 Small Businesses Tighten Budgets While Enterprises Drive AI-Fueled IT Growth

04:19 Cannata Report Shows IT Maturity Gap as Channel Weighs AI Bubble Risks

07:28 Intel Returns to Profit With Government Boost, but Foundry Struggles Continue

09:52 TD SYNNEX Report Shows Partner Growth Slowing but Confidence Holding Strong

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