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Investing.com -- Software spending growth expectations have softened for the second half of 2025 and into 2026, according to Bank of America’s latest IT spending survey. 

But while near-term demand is under pressure, long-term trends remain constructive, and artificial intelligence priorities are said ot be shifting to back-office functions.

“Our IT professionals’ survey (fielded in May to 500 IT budget decision makers) suggests software spending growth intentions have come down a bit for 2H25 and 2026 since our last survey in December,” BofA analysts wrote.

Spending is now expected to rise 9.9% in 2025, down from 10.9% previously. For 2026, growth is forecast at 10.8%, down 40 basis points from the prior survey.

“Changing macro policies are muddling the demand environment to some extent,” BofA noted, citing tariffs and government policy shifts affecting sectors like retail and public services. 

Still, pipelines for new projects “remain healthy,” supporting a “better 2026, albeit at a lower level,” according to the bank.

Data analytics reclaimed the top spot as the highest spending priority, overtaking cloud communications and video conferencing. 

Observability and financials/ERP categories also saw increased spending expectations, while front-office applications like CRM, marketing, and support declined, suggesting firms are reassessing where AI makes the most impact.

On that front, BofA found a sharp increase in interest for applying AI to back-office software, which “registered the highest incremental interest,” rising 9 points since the year-end 2024 survey. Infrastructure and back office led all categories, cited by 60% and 58% of respondents, respectively.

The shift comes as firms remain cautious about agent-based front-office AI offerings like Salesforce’s Agentforce and HubSpot’s Breeze, which BofA said are “still evolving” in terms of pricing models.

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