IT spending: What the analysts think
Jim Zimmermann
Published: 06 Oct 2003 15:00 BST
Culpepper and Associates
Culpepper does a quarterly review of the financial filings of more than 290 companies. From a review of its second quarter filings, Culpepper found that:
For the fourth consecutive quarter, the software sector posted improved results, and all four of its "high tech" sectors (software, IT service, hardware, semiconductor) show signs that "the bottom is behind us."
Based on these statistics and "many positive signs now in the economy," Culpepper believes that "the improved Q2 results are only a hint of the far better times ahead."
Gartner's Technology Demand Index
According to Gartner, there are "early signs that IT spending will strengthen in the second half of 2003 and that provides the necessary first steps for a turnaround in IT spending for 2004."
Gartner conducted its weekly survey of its 20,000-member panel of IT decision makers from small, mid-sized, and large businesses and found that "US businesses spent below their budgeted levels." However, the good news is that they spent 95.1 percent of their budgets, on average -- way up from an 80 percent spending level in March and April, and the index has remained above 90 percent for three consecutive months. According to Gartner, this indicates that "IT demand is slowly returning to budgeted spending levels."
However, Gartner cautions that "the underlying data still reflects a conservative market that is focused on cost control." But in conclusion, Gartner states that, "Based on the trends we see, we are optimistic that IT spending will return to or exceed budgeted levels in the fourth quarter of this year."
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