Information Technology Services Industry Profile

Companies in this industry provide services such as software support, computer systems design, and data processing facilities management. Major companies include Cognizant, DXC Technology, and the technology consulting arm of IBM (all based in the US), along with Accenture (Ireland); Capgemini (France); and HCL Technologies, Infosys, Tata Consultancy Services, and Wipro (all based in India).

Worldwide IT spending is projected to reach about $5.1 trillion in 2024, an increase of 8% from 2023, according to Gartner. The increase in cloud services has led to an increase in software and IT spending. Digital technology initiatives will remain a priority for the industry, driven by the changing work landscape to accommodate complex hybrid work for employees.

The US information technology (IT) services industry includes about 145,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $440 billion.

COMPETITIVE LANDSCAPE

Demand for IT services is driven by rapid technological advances, but spending depends on the health of the economy. The profitability of companies depends on technical expertise, innovative services, and effective marketing. Large companies have advantages in broad service offerings and global reach, which give them the ability to provide outsourcing services to big corporate customers. Small companies can compete effectively by specializing in market niches or by partnering with larger companies that want to broaden their mix of services. The US industry is fragmented: the 50 largest companies account for about ...