How are banks navigating the road to digital transformation? We’ve partnered with Kyndryl to survey 200+ IT decision-makers and uncover the key challenges, priorities, and technologies shaping the future of banking IT.
Join us on November 27 at 11:00 a.m. CET for an exclusive webinar hosted by Eric Beaudet, Senior Analyst at PAC, and discover:
Munich, July 08 , 2026, Germany’s Top 10 IT Services Providers Face a Tough 2025 as Market Growth Slows and AI Reshapes the Sector
After several years of solid demand, the German IT services market cooled noticeably in 2025, though it still posted slight growth. According to PAC estimates, the market grew by approximately +1.6%. This placed Germany below the Western European average of +1.8% and made it one of the weaker major IT service markets in Western Europe in 2025. Among the major markets, only France performed even worse.
This trend shows that Germany was not a crisis market in 2025 but a significantly more selective and challenging market than in previous years. Growth was no longer widespread across all customer segments and occurred primarily where providers could deliver concrete efficiency gains, regulatory relevance, security expertise, cloud and SAP modernization, or measurable implementation capabilities. Mere transformation rhetoric was increasingly insufficient.
The overall economic situation weighed particularly heavily on investment-intensive customer segments. The environment was especially difficult in manufacturing, especially in the automotive industry, due in part to a weak economy, cost pressures, delayed transformation programs, and high uncertainty in parts of the industry. By contrast, the public sector performed more robustly. Public sector clients continued to invest in digitalization, modernization, the cloud, cybersecurity, and administrative modernization, even though decision-making processes remain protracted.
In this environment, the major providers exhibited markedly different trends. While some players benefited from their strong position in the public sector and from cloud transformation, cybersecurity, SAP modernization, and managed services, others were more adversely affected by their dependence on large industrial clients, a project-based consulting business, or internal corporate restructuring.
At the same time, artificial intelligence is structurally transforming the market. Automation across software development, operations, testing, support, and service delivery is increasing pressure on traditional IT service models to improve efficiency. Providers whose business models rely heavily on time-and-materials, manual delivery, and large project teams are particularly affected. While AI creates new opportunities in consulting, integration, and platforms, it is increasingly putting pressure on traditional revenue models.
Services related to cloud, cybersecurity, AI, SAP modernization, managed services, and public-sector digitalization remained in particular demand. By contrast, more discretionary consulting and transformation budgets performed more weakly, particularly in certain industries. For providers, this means that in 2025, differentiation stemmed less from size alone and more from access to stable customer segments, resilient delivery models, industry expertise, and the ability to integrate AI productively into their service delivery.
Overall, large international providers did not perform uniformly. Accenture and Deutsche Telekom, including T-Systems, maintained their leading positions and continued to grow in 2025. Atos, on the other hand, remained under significant pressure. Notably, medium-sized and more focused providers such as Adesso achieved above-average growth. This suggests that customer proximity, industry focus, agile delivery, and positioning in dynamic segments remain key differentiators.
Top 10 IT Service Providers in Germany 2025
Accenture remains the number one in the German IT services market in 2025. The company benefited from its strong position with large clients and from growth in cloud and platform transformation, data, AI, and managed services. Despite a challenging market environment, Accenture increased its revenue in Germany by approximately 6% to 3.2 billion euros, according to PAC estimates.
Deutsche Telekom, including T-Systems, ranks second and grew by approximately 4% to €3.1 billion. Its strong position in the German market, proximity to public sector clients, robust cloud offerings, security, connectivity-related IT services, and large-scale transformation programs had a stabilizing effect.
Capgemini remains a key player in the German market but recorded a slight decline of about 2% to 1.8 billion euros in 2025. The difficult situation in parts of the manufacturing industry, particularly in automotive, had a negative impact. However, Capgemini remains well-positioned in areas such as cloud, SAP, data, engineering-related IT, and digital transformation.
Atos saw a significant decline in 2025, reaching €1.6 billion according to PAC estimates, a drop of approximately 10%. Ongoing restructuring, the proactive withdrawal from some unprofitable business, and pressure in traditional infrastructure and outsourcing businesses weighed more heavily on its performance than on most competitors.
IBM performed largely steadily and grew slightly by around 1% to €1.5 billion. Demand for hybrid cloud, mainframe-related modernization, AI, security, and complex transformation projects supported the business, even though IBM was not among the most dynamic providers in the market.
Infosys was among the strongest growth providers in the top 10, with growth of around 10%, reaching €1.4 billion. The company benefited from large transformation mandates (still surfing on the Mercedes and Daimler wave), offshore and nearshore delivery, cost efficiency, and growing demand for cloud, application, and managed services.
NTT Data grew by approximately 4% to €1.4 billion. The provider maintains a broad presence in Germany across SAP, application services, the public sector, financial services, manufacturing, and critical infrastructure.
Adesso posted the strongest growth among the German Top 10, at around 13%, reaching €1.15 billion. The company benefited from its strong local presence, industry focus, software development, proximity to the public sector, and strong positioning in digital transformation projects.
Bechtle remained nearly stable in 2025, approaching €1.15 billion. The company benefited from its broad customer base and from its system house business, managed services, workplace solutions, cloud, and security offerings, but was also affected by cautious investment sentiment in parts of the SME sector and industry.
SAP reported €1 billion, slightly below the previous year, representing a decline of approximately 1%. In the services business, demand for S/4HANA transformation, cloud migration, and business process modernization generally provided support; at the same time, many customers faced budget and prioritization pressures.
FOR MORE INFORMATION, PLEASE FEEL FREE TO CONTACT US
PAC Horizons 2026 is a special edition of our annual event series, held in celebration of PAC’s 50th anniversary in Paris, Frankfurt, London and Munich. To mark this important milestone, the events will bring together industry leaders, innovators, and decision-makers to discuss the key developments and challenges shaping the European IT services market.
This year’s agenda will focus on five central themes:
Throughout the sessions, we will explore these topics not only from an analyst’s perspective but also in conversation with user organisations to understand the concrete impact on their businesses.
Networking with your peers and PAC analysts will be at the heart of the event. At the end of the programme, participants will have the opportunity to further explore the presentation topics in dedicated discussion groups or address their own strategic questions in personal 1:1 conversations with PAC analysts and experts.Interested in joining PAC Horizons 2026?
PAC has published its latest ranking of the top ten IT services providers based on UK revenue, and while overall market conditions remain challenging, the largest vendors out-paced overall market growth.
Total spending on IT services by UK organizations increased by only 2.2% in 2025, but more than half of the top ten players were able to beat this level of growth as clients turned to larger players to support their evolving needs. As appetite for artificial intelligence continues to increase, clients are looking to work with vendors that can accelerate their adoption of AI at scale, and want to work with partners that are adapting their skills, offerings and engagement models to help them transform at speed.
More details for our SITSI customer > “IT Services – Preliminary Vendor Rankings – UK“
Part of the journey to harnessing AI effectively is migrating legacy applications and workloads to more robust platforms, and ERP modernization and legacy transformation remain an important aspect of many of the largest IT services deals signed in the UK in recent months. This also plays to the strengths of the larger vendors that have the depth of resources to manage this transition at scale.
TCS once again topped the rankings as the largest IT services supplier in the UK, and reinforced its position through new wins with clients including NHS Supply Chain and Aviva, as well as extending its relationships with customers including Kingfisher and Virgin Atlantic. The company’s successful expansion into the public sector has been a key part of its recent development and it recently committed to creating 5,000 new jobs in the UK during the next three years.
Accenture ranked in second place, and made the most eye-catching acquisition in the UK market last year with the purchase of Faculty AI, which develops the “Frontier” data intelligence platform. This move highlighted the new types of investment that IT services providers are increasingly making as they build more AI-centric and platform-based propositions to drive differentiation and speed time-to-value.
Capgemini and IBM both enjoyed strong years in the UK, with each posting double-digit rises in revenue as a result of both organic and inorganic growth. Capgemini is leading complex, transformation projects at organizations such as HMRC and National Grid that aim to help them unlock the value in their huge and escalating data volumes. IBM’s long-term investments in AI, cloud and cyber security are starting to pay dividends as it helps UK organizations such as the Home Office and the Ministry of Defence (MoD) build the digital foundations to support their future strategies.
The fastest growing of the top ten players was CGI, due in part to the integration of its acquisition of domestic IT services challenger BJSS, but also to a string of major wins in the commercial, defence and central government sectors. PAC expects the public sector to be the UK’s fastest-growing IT services market for the next five years, as long-term transformation cycles in the NHS and the MoD drive a more data- and AI-centric approach.
Nick Mayes, Principal Analyst at PAC, said: “While the leading players in the UK IT services market have remained fairly consistent for several years, there are a lot of changes happening beneath the surface. All IT services suppliers need to adapt fast as AI shakes up and cannibalizes the delivery and commercial models that have underpinned this sector for decades. If we were to fast-forward a further five years, the leading players will be those that have most successfully pivoted around these fundamental shifts.”
Despite the current economic headwinds, PAC expects UK spending on IT services to accelerate to growth of just over 3% in 2026. Legacy transformation will be the primary contributor to project volumes, but aspects such as cyber resilience, data sovereignty and cloud platform optimization will also create new growth opportunities for suppliers. These areas will be a key focus for PAC’s research agenda in the coming months.
For more information, please contact:
Nick Mayes, Principal Analyst
Après plusieurs années de croissance soutenue, le marché français des services numériques a traversé une année 2025 difficile. Selon les estimations de PAC, le marché des services IT a reculé de -1,8%, pénalisé par un contexte économique incertain, des budgets technologiques sous pression et des arbitrages d’investissement de plus en plus défavorables aux prestations de services traditionnelles. De nombreuses grandes entreprises et organisations publiques ont également poursuivi leurs programmes d’optimisation des coûts et de rationalisation de leurs investissements technologiques.
Dans cet environnement complexe, la majorité des grandes ESN ont souffert et les six premiers acteurs du marché français ont tous enregistré un recul de leur chiffre d’affaires en France en 2025, tout comme 7 des 10 premières grandes entreprises en France. Cette situation s’explique notamment par leur forte exposition aux grands comptes, dont les dépenses en services numériques peuvent constituer une variable d’ajustement lorsque les conditions économiques se dégradent.
Parallèlement, l’intelligence artificielle continue de transformer en profondeur le secteur des services IT. L’automatisation croissante de certaines activités, l’industrialisation du développement logiciel et l’émergence de nouveaux modèles de delivery remettent progressivement en question les modèles économiques historiques fondés sur la facturation au temps passé. L’IA représente ainsi à la fois une opportunité de croissance et un facteur de pression sur les revenus traditionnels des ESN.
Dans l’ensemble, les grandes ESN, davantage exposées aux grands donneurs d’ordre et en première ligne sur la transformation IA, ont plus souffert que les plus petits acteurs en 2025. En effet, certaines ESN continuent de tirer leur épingle du jeu et enregistrent de la croissance dans un marché en recul, grâce à leur positionnement sur les segments les plus dynamiques, notamment la transformation vers le cloud et la cybersécurité.
Capgemini demeure de très loin le leader du marché français des services IT. Le groupe a néanmoins connu une année 2025 difficile, avec un recul de son chiffre d’affaires en France estimé à -3,7 %, en raison de la faiblesse persistante du secteur manufacturier (automobile …) et de la contraction des secteurs de l’énergie et des utilities.
Sopra Steria conforte sa deuxième place sur le marché français avec une performance relativement résiliente et un recul estimé de son chiffre d’affaires de « seulement » -1,1%. En effet, le groupe a renoué avec la croissance au quatrième trimestre grâce, notamment, à une amélioration de l’activité dans le secteur aéronautique et une forte dynamique dans le secteur public.
Accenture conserve la troisième marche du podium malgré un recul de son chiffre d’affaires dans un contexte peu favorable aux activités de conseil et de transformation.
Orange Business, quatrième, enregistre une légère décroissance sur les services IT, mais Orange Cyberdefense demeure un acteur de référence sur un segment très dynamique et enregistre une croissance de plus de 6% en 2025.
Atos demeure dans une situation plus délicate que ses principaux concurrents malgré les transformations engagées. La pression continue sur plusieurs de ses marchés historiques pèse sur son activité. Nous estimons que son chiffre d’affaires sur les Services IT en France a reculé de plus de 10% en 2025.
Les autres acteurs du Top 10 ont connu des trajectoires plus contrastées. CGI et Inetum ont également subi les effets du ralentissement du marché et de la prudence des grands donneurs d’ordre. À l’inverse, Alten, IBM et surtout Neurones ont affiché une croissance de leur chiffre d’affaires, grâce à leur positionnement sur les segments les plus dynamiques (engineering, cloud, cybersécurité…) et à une solide exécution. Neurones, notamment, confirme ainsi sa capacité à surperformer le marché année après année.
Nous sommes une société de recherche de marché, basée sur des données, avec un ADN de conseil. Depuis 1976, PAC apporte des réponses ciblées et objectives aux défis de croissance des fournisseurs de logiciels et de services informatiques dans le monde entier. Nous sommes leur partenaire privilégié pour définir leur stratégie, renforcer leur part de marché, optimiser leur go-to-market et les aider à se positionner en tant que leaders d’opinion. PAC est un cabinet d’analystes avec une équipe de plus de 50 employés et des bureaux dans quatre pays européens. Nous réalisons des études de marché dans plus de 30 pays, grâce à nos piliers “Recherche, Conseil et Visibilité”, ainsi qu’à notre célèbre plateforme de recherche SITSI®.
SAP Sapphire Orlando is SAP’s flagship event in the United States, bringing together global customers, partners, and executives to showcase the company’s strategy for AI-driven, cloud-based enterprise transformation. The event highlights SAP’s vision for the future of business applications, with a strong focus on innovation, platform integration, and real-world customer value.
Key agenda highlights include:
More events where we are present
Who will be there:
SAP Sapphire Madrid 2026 is the EMEA edition of SAP’s flagship Sapphire event series, bringing together customers, partners, and SAP experts from across Europe, the Middle East, and Africa.
The event showcases how organizations in the region are accelerating digital transformation with SAP’s cloud portfolio, Business AI innovations, and integrated business suite.
Key highlights include:
Who will be there:
Paris, Munich, London, 19 February 2026: Market research and strategic consulting firm PAC has released its PAC RADAR series on “Leaders in AI-related Services 2026 – Europe, France, Germany, and the UK”, designed to help AI clients and prospects identify the right services partner for their business.
PAC has evaluated leading AI-related service providers in Europe and in local markets in France, Germany, and the UK. This series of RADAR reports and graphics analyses more than 30 providers ranging from global market leaders to specialized local experts. The assessment covers overall AI-related services capabilities in Europe, France, Germany, and the UK, as well as Agentic AI and Sovereign AI-related services, AI-related services for five business functions, and AI-related services in four vertical sectors, at European level. The assessment also covered two crossed categories, Sovereign AI-related services in France and AI-related services for the German Mittelstand.
Even though AI is not a new concept, PAC has witnessed phenomenal interest in AI-based tools and services in recent years. The meteoric rise of generative AI in 2024 and Agentic AI in 2025 have disrupted the IT market and reshaped the approach to digital transformation.
While giants like Amazon and Google are announcing huge investments in AI, and even a European AI LLM provider such as Mistral AI is investing record amounts in datacenter infrastructure in early 2026, also global, European, and local IT services providers are prepared to support their customers with AI adoption.
Accenture for example has been assessed ‘best in class’ in most categories of this PAC RADAR among other things thanks to its important investments in IP assets, R&D, numerous partnerships with universities, training, competence centers, and M&A related to AI.
This market upheaval has also sparked discussions about accountability, ethics, and legal frameworks that guide the development of AI. Concepts like eXplainable AI (XAI), Responsible AI (RAI), and Sovereign AI have started to be incorporated into vendor offerings and guidelines for the reliable use of AI.
CGI, for example, has established itself as a ‘best-in-class’ provider for Sovereign AI services in Europe by leveraging a deep local footprint and advanced sovereign cloud capabilities. On the other hand, JEMS, a pure player in Data & AI emerges as an ‘excellent’ provider for Sovereign AI services in France thanks to its ability to deploy AI Agent / complex AI services on sovereign infrastructures for the finance and public sectors, amongst all other industries in France.
Local players can also make their mark in categories such as AI-related services for the German Mittelstand where Materna stands out as ‘best-in-class’ provider, scoring particularly well with sovereign AI approaches and expertise in the public sector.
While many vendors focus on AI-related consulting and systems integration services, T-Systems stands out as a ‘best-in-class’ vendor with a true end-to-end portfolio; services range from sovereign operations services, incl. massive GPUaaS via the recently launched Industrial AI Cloud, to deep project expertise in sectors like manufacturing and the public sector.
Whilst IT service providers have made great strides in establishing AI service lines to meet modern demands and opportunities, for many of their clients the transition from Proof-of-Concepts (PoC) to production is still not occurring at broad scale. The main AI use cases are still AI-powered everyday professional tools, chatbots, or content and image generation tools. The other significant use case is to further enhance existing automation applied to business workflows and operating models.
Furthermore, providers and clients are aware that productivity gains from AI are not necessarily obvious to make and will certainly not concern all their business processes currently. Nevertheless, IT services providers and client organizations are starting to think bigger. The latter are approaching this opportunity from the lens of business transformation at the scale of the organization but often starting with specific processes.
The PAC RADAR is an effective tool for the holistic evaluation and visual positioning of software vendors and IT service providers on local markets. With the help of predefined criteria, PAC evaluates and compares providers’ strategies, development, and market position, in addition to their performance and competencies within specific market segments. Each PAC RADAR focuses on a specific IT market segment, either geographic, technologic (Agentic AI and Sovereign AI), business function-oriented (Back-Office Workflows, Digital Customer Engagement, ICT, SCM, and HCM), vertical sector-focused (Manufacturing, Financial Services, Retail & Wholesale, and Public Sector), or specific, such as Sovereign AI-related services in France and AI-related services for the German Mittelstand.
The PAC RADAR is supplemented by a dynamic tool that allows user companies to weight all evaluated criteria in line with their specific preferences. For instance, the long list of providers this tool compiles for a medium-sized manufacturer seeking a services partner to implement AI for Supply Chain Management in Germany may differ significantly from the list generated for a French global corporation operating in several vertical sectors looking for a provider to integrate AI in numerous business processes at global or European level.
For more information about the PAC RADAR series go to “Leaders in AI-related Services 2026 – Europe, France, Germany, UK”.
Date & Time: March 12, 2:30 – 4:20pm (GMT+1)
Location: Alexandre Fira Congress Hotel, Barcelona, Spain
We are pleased to announce the 5th edition of the Green All-Optical Network Forum, organised by IDATE and taking place in Barcelona alongside the Mobile World Congress (MWC).
The event brings together industry leaders, network operators and technology innovators to explore the latest trends and breakthroughs in sustainable all-optical networks. It offers a unique platform to exchange insights, discuss key challenges and help shape the future of environmentally friendly telecommunications.
Do not miss the opportunity to connect with experts, gain practical insights and be part of the dialogue on greener networks.
Secure your spot here.
We hope to meet you at HANNOVER MESSE 2026 — one of the world’s leading industrial technology events covering innovation across AI, automation, digitalisation and sustainable manufacturing. The fair brings together industry leaders, technology providers and decision-makers to explore real-world industrial transformation and future-ready solutions.
Agenda highlights include:
Keynotes & leadership sessions on AI-driven industrial value chains
Solution Labs and showcases on automation, smart production and digital twins
Discussions on decarbonisation, resilience and technology sovereignty
Networking formats connecting global industrial and tech communities
More events where we are present
Who will be there:
Paris, Munich, London, 20 January 2026: Market research and strategic consulting firm PAC has released its PAC RADAR series on “Leaders in SAP Services 2026 – Worldwide, Europe, France, Germany, UK”, designed to help SAP clients and prospects identify the right services partner for their business.
PAC has evaluated leading SAP service providers globally as well as key players in Europe and local markets in France, Germany, and the UK. This series of RADAR reports and graphics analyses more than 25 providers ranging from global market leaders to specialised local experts. The assessment covers overall SAP delivery capabilities and providers’ ability to support globally and regionally operating clients in their S/4HANA migrations, modernise back-office processes using SAP Business AI and Joule, and deliver SAP-related managed services.
Currently, demand for SAP-related services is still driven by ongoing S/4HANA migrations. According to PAC estimates, by the end of 2026, more than half of all companies will have completed their migration to S/4HANA. Future demand for SAP-related services will increasingly shift to other areas, such as the integration of AI-driven use cases, automation and modernisation of business processes, data management, and the integration of SAP’s LoB solutions, as well as custom extensions and third-party applications.
Against this backdrop, customer organisations must reassess their relationships with SAP partners.
“PAC’s RADAR for SAP-related services reduces the complexity of vendor selection by providing transparency on partners based on a variety of criteria, such as regional and global delivery capabilities, expertise, and AI-driven innovation,” says Joachim Hackmann, Principal Analyst at PAC and Lead Analyst for this PAC RADAR.
PAC’s most recent analysis of SAP service providers reveals several striking trends. Providers have considerably expanded their AI-focused service offerings, with a strong emphasis on developing proprietary IP assets.
“Compared to previous RADAR evaluations, we see a clear expansion of portfolios, especially through predefined AI use cases that better exploit the potential of Business AI and Joule,” says Sidney Siegertsz, Senior Analyst at PAC.
Another notable trend is the growth of hybrid cloud hosting capacities, driven by increasing customer adoption of RISE with SAP and increased awareness of data protection. Deployment models frequently target cloud infrastructures provided by major hyperscalers.
“Providers have started to complement their hosting services with sovereign infrastructure options. In particular, providers with a strong local footprint and customer focus offer additional consulting services for sovereign SAP operations,” says Dominique Raviart, Senior Analyst.
Let’s highlight a few examples that illustrate these market dynamics: T-Systems has reinforced its strong position as a preferred SAP partner in Europe, especially in the hosting business, with innovation around sovereign infrastructure. NTT DATA is one of the top SAP partners globally, distinguished by a rich set of proprietary IT assets and AI use cases. Atos has long been recognised as a trusted SAP services provider, gaining consistent recognition from competitors and strong ratings in PAC’s RADAR assessments. BTC is a highly specialised provider with a strong industry focus, serving midsize enterprises and consistently earning excellent customer ratings. DXC has established itself as a leader in the SAP ecosystem especially within the last 3 years, earning recognition in several categories of PAC’s RADAR series on SAP-related services for 2026. INETUM stands out for its excellent performance as a recommended SAP partner for customers, with a well-established and reliable global service organization, particularly strong in Western Europe.
The PAC RADAR is an effective tool for the holistic evaluation and visual positioning of software vendors and IT service providers on local markets. With the help of predefined criteria, PAC evaluates and compares providers’ strategies, development, and market position, in addition to their performance and competencies within specific market segments. Each PAC RADAR focuses on a specific IT market segment, such as SAP Consulting & Systems Integration, SAP Application Management, SAP Hosting, and SAP S/4HANA-related Services.
The PAC RADAR is supplemented by a dynamic tool that allows user companies to weight all evaluated criteria in line with their specific preferences. For instance, the long list of providers this tool compiles for a midsize company seeking a services partner for an SAP S/4HANA migration may differ significantly from the list generated for a global corporation looking for a provider to migrate and operate a complex SAP environment.
For more information about the PAC RADAR series go to “Leaders in SAP Services 2026 – Worldwide, Europe, France, Germany, UK”
We hope to meet you at the PwC EMEA Analyst Summit on March 12, 2026, at PwC More in London. The summit brings together PwC leadership, EMEA subject matter experts, clients, and analysts for a day of exchange and insight.
The agenda will include discussions and real-world examples of how PwC is supporting organizations to deliver, operate, and accelerate in a dynamic business environment. This event is also an opportunity for open dialogue on market trends and on how PwC is partnering with clients and AI, technology, and alliance partners across the region.
More events where we are present
Who will be there:
We hope to meet you at the 10th Intelligent Automation Congress 2026, a leading European event for AI, automation, and digital transformation, taking place in Milan in collaboration with the Osservatorio Intelligent Business Process Automation on March 3rd and 4th.
The congress brings together industry leaders, innovators, and decision-makers to explore how AI, RPA, and intelligent automation are reshaping business and operations. A key highlight will be a presentation by our Analyst Tom Reuner.
More events where we are present
Who will be there:
