Mergers and acquisitions to be IT’s next growth play

2026-06-29 · Source: HFS Research · Field: Business & Management — Corporate Strategy & Leadership, Consulting & Professional Services, Entrepreneurship & Start-ups · Depth: Fundamental Awareness, quick

Summary

AI is significantly reshaping the global IT services industry, making mergers and acquisitions (M&A) the fastest route to growth. As enterprises tighten discretionary spending and AI reduces demand for people-intensive services, companies are increasingly acquiring specialized capabilities rather than building them organically. Accenture exemplifies this trend, raising its FY26 acquisition budget to approximately \$9 billion from an earlier target of \$5 billion, expecting these deals to contribute nearly 2% of its FY27 revenue. The company has acquired firms spanning cybersecurity, industrial AI, and digital transformation, including runZero, Faculty, and Avanseus, to expand into high-demand areas. Indian IT firms like Infosys, HCLTech, and Wipro are pursuing similar strategies, with Infosys acquiring Optimum Healthcare IT for \$465 million and Stratus for \$95 million. Experts note acquisitions provide faster access to AI capabilities and industry expertise, crucial as AI adoption expands into critical infrastructure.

Key takeaway

For VPs of Engineering evaluating growth strategies in the AI-driven IT services landscape, recognize that organic capability building is increasingly slow. Your focus should shift towards strategic acquisitions of specialized AI, cybersecurity, and operational technology firms. This approach provides faster access to critical IP and expertise, enabling quicker market expansion and meeting client demands for specific business outcomes. Prioritize integration plans to preserve acquired strengths and ensure long-term value realization.

Key insights

AI's impact on IT services is driving a global M&A surge for specialized capabilities and faster growth.

Principles

• Acquisitions accelerate access to AI capabilities and IP.
• Focus on business outcomes, not just project teams.
• OT, cybersecurity, and proprietary expertise are key.

Method

Acquire specialized capabilities in high-demand areas like cybersecurity and industrial AI to expand market reach beyond traditional IT services.

In practice

• Target firms with OT, cybersecurity, or industrial AI expertise.
• Integrate acquired strengths for long-term value.
• Monitor M&A impact on client wins and margins.

Topics

• AI Services
• Mergers and Acquisitions
• IT Services Industry
• Cybersecurity
• Operational Technology
• Accenture Strategy

Best for: Investor, Director of AI/ML, VP of Engineering/Data, Consultant

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Editorial summary, takeaway, and curation by AIssential. Original article published by HFS Research.