Hello. This is Stanton Jones with what’s important in the IT and business services industry this week.
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What You Need to Know
The Americas managed services market has seen a return to growth in 2025 primarily due to banking and financial services, while demand in the EMEA region continues to be sluggish on macroeconomic and geopolitical concerns.
Data Watch
Background
As we discussed on the 3Q25 Index Call last week, managed services bookings are largely flat year to date, with continued business uncertainty weighing on demand. The story is different, though, between the Americas and EMEA. As you can see in this week’s Data Watch, the Americas has seen a return to growth, while EMEA has been on a somewhat downward trajectory. Results have been softening since the blowout quarter of 3Q24, when six mega deals with an ACV of $1.3 billion were awarded.
The Details
- The Americas region is up 15% YTD on the back of a record number of contract awards. On an industry basis, BFSI is up 30% YTD, and on a service line basis, ITO is up 25% YTD.
- In EMEA, ACV is down 8% YTD, while the number of awards in the region is down 15%. ADM ACV is down 16% YTD, and the biggest region, the UK, is down 19% YTD.
What’s Next
In the Americas, BFSI has turned into a real growth engine. Banks are reporting record earnings this quarter, which could lead to a loosening of discretionary technology spending. And, as we discussed on the call, we’re seeing strong momentum at both ends of the outsourcing spectrum, from large-scale renewals to smaller, sub-$10 million awards that had been quiet earlier this year.
In EMEA, energy costs, tariff concerns and geopolitical tensions are leading to business uncertainty, which is having a downstream impact on tech services spending. These factors don’t appear to be abating any time soon, which means the slow discretionary spending environment is likely to continue in the region.
In short, we’re seeing signs of a recovery in managed services, but it’s regional, not global. And, based on the signals we’re seeing today, we believe these trends are likely to continue into early 2026.About the author
Stanton Jones
Stanton helps enterprise technology leaders, IT service providers and buy- and sell-side professionals make sense of the global IT services sector. Stanton's weekly briefing - the Index Insider - is read by thousands of industry stakeholders each week.
