Tercera Outlines the Top IT Services Trends to Watch in 2025

Growth returns to some sectors, AI-native consultancies pressure traditional providers, and value pricing finally gets real

CHICAGO, Jan. 16, 2025 /PRNewswire/ -- Tercera, an investment firm supporting growth-stage IT professional services firms, today revealed the top trends it believes will impact the tech services market in the year ahead.

"2025 is going to be a year of reckoning for IT services firms," said Chris Barbin, CEO of Tercera. "AI is giving rise to a new generation of service providers. These AI-native firms, along with shifting behavior from buyers, partners and employees will force leaders to rethink the playbooks they've used for decades."

Here are 5 trends Tercera believes will shape the IT services landscape in 2025.

Trend 1: Pockets of growth return for services
Businesses that put transformational projects on hold realize they need to modernize or get left behind, creating tailwinds in some sectors like data, security, financial services and energy. Gartner is predicting 9.4% revenue growth for IT services in 2025, up from 5.6% growth in 2024. A push for greater delivery efficiency and smaller project sizes make it harder for firms to grow like years past, but automation brings an uptick in gross margins and profitability.

Trend 2: Rise of AI-native consultancies
AI-native firms are finding ways to deliver services cheaper and faster using reusable IP, autonomous AI agents and low-code/no-code automation. This puts pressure on traditional firms that haven't invested, especially public firms constrained by quarterly results and entrenched business models. More companies are taken private to make the pivot. 

Trend 3: Game time for GenAI
Today only an estimated 10% of GenAI pilots make it into production. As companies get clear on how to utilize it effectively, assess ROI and solve data issues, we expect that number to double or triple this year. IT services firms must move beyond simply pitching pilots and demonstrate real experience in production systems.

Trend 4: The rise of value-based deals
For years services firms have dabbled with value-based selling, where a portion of the fees is set on business outcome. Yet few succeed. AI will change this. As timelines shrink and projects require less people to deliver results, firms will begin to move away from hours and heads to output and outcomes. Business buyers will get behind the shift, while procurement resists.

Trend 5: Africa on the rise: Race for data and AI talent moves to a new region
To date, India, Latin America, and Eastern Europe have been destinations for those seeking low-cost, high-quality talent. As companies go on the hunt for data, AI and cyber specialists, they'll turn to new regions like Africa, home to the youngest population in the world. Services firms start exploring the region, starting with Nigeria, Egypt, Kenya, and South Africa.

A full list of 2025 trends can be found on Tercera's blog, as well as grading of last year's predictions.

About Tercera
Tercera is an investment firm founded to accelerate the growth of people-centric businesses. Specializing in the $1 trillion IT services market, the Tercera team is composed of invested operators who know first-hand what it takes to build and scale a successful services business.

SOURCE Tercera