Spending on ITC offerings continued to boom in Q2 2025. ITCandor’s quarterly market assessment shows that:
- Quarterly user spending on IT and Communications offerings increased year on year by 11% to $2,026 billion,
- Net profit from those sales made by suppliers also grew by 11% to $321 billion,
- Annual spending to the end of June was up 6% to $7,782 billion and
- Annual net profit was up 11% to $1,192 billion.
Quarterly spending was a new record high for the industry, while the quarterly net profit was the highest in any quarter since Q1 2014. In this post I’ll look at the variation in offerings, suppliers and countries and make some comments on how these results will affect my prediction for market growth in 2025 overall. As the value of the $US has been falling against many other currencies recently, the growth inspending and net profit is even higher if you measure using constant dollar calculations (see the dotted lines in my Figure above).
In terms of spending on ITC offerings in Q2 20225:
- The small, but dynamic gaming market saw the greatest growth (+47% to $26b) – spurred on by the 3.5 million sales of Nintendo’s Switch 2 in June.
- The server market grew 26% to $134b, driven by the wide-spread adoption of Nvidia’s GPUs for AI applications and IBM’s introduction of is z17 mainframe.
- The Software as a Service (SaaS) market was the worst performing (-15% to $237).
- Storage system (-1% to $38b) and smart tablet (-4% to $51b) were the only other major ITC offerings to show a decline in spending.
The overall ITC market moved distinctly from a cloud-driven to an AI-driven one over the last few years.
The suppliers achieving the highest revenue growth from end-user sales were:
- Wistron (contract manufacturer spun off from Acer in 2000 and now a major partner for Nvidia’s AI revolution) was the most successful ITC vendor in Q2 2025, achieving a 150% growth in is revenues from end-users to $186m.
- Nintendo’s revenues grew by 147% to $3.91b in the quarter; despite this its annual revenues only grew by 2%.
- Other high-growth suppliers included notebook manufacturer Quanta (77%), chip-maker Cavium/Marvell (59%) and Nvidia’s (56%).
Apart from Nintendo, each of these manufacturers’ main business is in selling to other vendor’s. In consequence their total sales revenues for the quarter are far greater than hose shown in my Figure above.
My figure above shows the vendors ith the least growth in Q2 2025:
- Western Digital was the poorest performing supplier in terms of revenue in the quarter – the 31% decline to $990m was due to its decision to spin off its Scandisk solid state device supplier.
- Atos is in the process of restructuring. It sold off its Advanced Computing division to the French government for €410 in June 2025.
- Among the other poorly performing suppliers were peripherals manufacturers Canon and Oki, chip suppliers STMicro and Micron and Chinese cloud provider Baidu.
Most of these companies will post better results once their restructuring is complete.
I show the top and bottom countries in order of quarterly spending growth in my Figure above, where I’ve included both current dollar and local currency grow for the quarter and annual (>q2 2025) periods. It shows:
- Argentina (+65% to $3.00b), Turkey (+33% to $6.57) and Nigeria (+25% to $5.74) were the strongest.
- Israel (-3% to $6.83), Russia (-4% to $23.05b) and Switzerland (-5% to $17.53) were the weakest.
It is significant that the top performing countries only include South American, African and Eastern European countries and intriguing that two of the poorest are currently engaged in significant armed conflict.
Q2’s results demonstrate the continued growth of our industry, requiring me to rethink my revenue and net profit forecasts. I’m surprised, however, that none of the larger research companies are reporting this good news. Let me know what you think.