AI spending squeezes IT modernization as 61% of projects stall

An Ensono survey found 61% of organizations paused, delayed, scaled back or abandoned IT modernization projects in the past 24 months, diverting budgets to AI. More than 70% of projects exceeded their original budgets, with 27% overshooting by 51% or more.

• 61% of organizations paused or scrapped IT modernization in 24 months
• Over 70% of projects exceeded budget; 27% by more than 51%
• Digital transformation budgets grew from $39.4M to $54.2M in a year
• Only 17.5% have data infrastructure ready for agentic AI