Global Software Spending Surges to Close to USD 700 Billion in 2024, up 50% From 2020; the United States Extends its Lead
June 2, 2025
In 2024, global software spending reached USD 675 billion, up nearly 50% nominally from 2020's level of USD 454 billion. These figures - not adjusted for inflation - reflect a significant post-pandemic push to invest in improved software. This surge aligns with the rise in e-commerce and the maturation of artificial intelligence (AI) technologies. Rather than a one-off spike, this jump marks a lasting “new normal” in the digital economy: annual software expenditures have remained elevated and are projected to hover at this level.
The United States (US) maintains a firm lead in software investment – and that lead is expanding. The US spent USD 368.5 billion on software in 2024, more than half of the world’s total and nearly six times the next-largest spender.
As noted in the WIPO World Intangible Investment Highlights, software is now one of the fastest-growing IP-backed intangible investments globally. It drives both technological and organizational innovation, and enhances productivity and competitiveness, especially in the services sector and at the economy-level more widely, mostly via improved process efficiency and decision-making quality.
This blog highlights key insights from the latest data (courtesy of WIPO’s Global Innovation Index 2025 and S&P Global Market Intelligence) on how software spending trends have evolved post-pandemic. It concludes with an outlook on how AI and digital transformation rely on software: while AI provides predictive and generative capabilities, software enables their deployment, management, and scale.
Figure 1: Global Trend in Software Spending, in USD Billion, Actual and Projected, 2019-2027
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index
Post-Pandemic Boom Cements a New High in Software Spending
The pandemic period triggered an unprecedented surge in software spending, catapulting global investment to a new, higher trajectory. In 2021, worldwide software expenditure jumped by 33% year-on-year – an extraordinary growth rate that set a new baseline. Rather than reverting to pre-pandemic trends, annual software investment has stabilized around its post-2021 high. By 2024, the market reached USD 675 billion, and projections suggest that global software spending will reach close to USD 679 billion by 2027, driven by increased enterprise digitization, ongoing AI integration, and continued cloud infrastructure expansion.
Software spending
- Global software investment has stabilized at a significantly higher level following a nearly 50% surge during the pandemic.
- In 2024, the United States remained the world’s largest software investor, allocating $368.52 billion—representing more than half of global expenditure.
- Middle-income economies, including Iran, Argentina, and Indonesia, have emerged as some of the fastest-growing markets for software spending.
- Among the top 20 economies, software investment patterns show notable consistency, signaling stable and ongoing commitments to digital transformation.
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index. 2025 Software spending by Vanessa Behrens.
US Widens Its Lead in Global Software Investment
In 2024, software spending in the US reached USD 368.5 billion, accounting for more than 54% of global expenditure. This figure was nearly six times higher than that of the second-largest spender, China, and approximately 16 times greater than that of Germany, which ranked third.
The scale of investment by the US also surpasses that of the entire European Union (EU). The EU collectively spent USD 117 billion in 2024—less than one-third of the US total. Indeed, the US is spending more than twice as much on software than the EU and China combined.
Between 2019 and 2024, the US also ranked seventh globally in software spending growth (see figure 5).
Figure 2: Software Spending by Top Economies, in USD Billion, 2024
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index
Figure 3: Software Spending by Top Economies, in USD Billion, Actual and Projected, 2019-2025
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index
Top Five Countries Account for 73% of Global Software Investment in 2024
The US is likely to widen its lead in software due to its unique AI-software ecosystem. Companies like OpenAI, Google, Microsoft, Amazon, and Meta not only develop advanced AI models but also integrate them into vast software platforms. The US also has the resources to scale innovations such as AI-native infrastructure, AutoML, and explainable AI. China, with software spending reaching USD 61.8 billion in 2024, remains the world’s second-largest software investor. China has a huge internal market for AI-enabled applications—from fintech and logistics to smart cities and surveillance tech. Companies like Baidu, Alibaba, Tencent, and Huawei have strong capabilities in building AI-integrated software for scale. Germany ranks third globally in software investment, reaching USD 22.2 billion in 2024. The United Kingdom, fourth in global software investment at USD 20.3 billion in 2024, leads Europe in AI development. In 2024, France invested USD 19.3 billion in software, underscoring its ambition to become a global leader in AI. Innovation hubs like Station F, along with initiatives such as La Mission French Tech, have fostered a vibrant startup ecosystem, including notable AI companies such as Mistral AI and Hugging Face.
Only a few countries have seen notable changes in their rankings over this period. Indonesia, for example, made significant progress, advancing three places from 15th to 12th. A newcomer to the top 20 was Ireland, which entered the ranking for the first time in 2023, securing the 20th position in absolute terms.
Figure 4: Top 20 Economies by Software Spending, in USD, 2020-2024
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index
Middle-Income Economies Drive the Fastest Growth in Software Spending
Over 2019–2024, the fastest compounded growth rates in software investment were predominantly seen in developing and emerging markets. Twelve of the top 20 fastest-growing software markets are middle-income economies across all world regions, indicating that many developing countries are making significant leaps in building their software and IT capabilities.
Iran (Islamic Republic of) stands out with an approximately 17% compound annual growth rate, the highest globally. It is followed by Argentina, Indonesia, Senegal, India, and Cameroon – all recording strong double-digit growth. Argentina has solidified its role in software outsourcing and developer talent with localized applications in fintech and agritech, whereas Indonesia has invested considerably in software for e-government, health tech, and AI for logistics and language translation.
Figure 5: Top 10 Fastest Growing Economies by Software Spending Compounded Annual Growth Rate (%), 2019-2024
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index
Software Spending Rankings Shift When Adjusted for Economic Size
When comparing software spending in absolute terms to spending scaled by GDP (indicator 6.2.3 in the GII), the rankings are again led by the US, followed by Spain, Ireland, Sweden and Iran. The US is the only economy spending more than 1% of its GDP on software. The strong showing of Spain and Ireland but also Sweden, Iran and Denmark in this GDP-adjusted software metric are remarkable.
Table 1: Top Economies for Software Spending, in USD Billion (left) and Scaled as a Percentage of GDP (right), 2024
Source: Authors based on S&P Global Market Intelligence Database and WIPO Global Innovation Index
Outlook: AI Fueling Sustained Software Investment
The global rise in software investment reflects not only accelerating digital transformation but also a deeper structural shift: the convergence of software engineering and AI. AI is the fuel, while software is the vehicle.
The global software spending momentum of nearly USD 700 billion by 2027 will be driven by sustained enterprise adoption of AI-native tools, continued investments in cloud infrastructure, and the rising importance of scalable, intelligent software systems across sectors.
AI systems indeed rely on layered software architecture:
- Data infrastructure for ingestion and labeling;
- Model training environments such as TensorFlow and PyTorch; and
- Deployment environments like CI/CD pipelines using Docker and Kubernetes, for scalable, real-time operation.
Looking into the future, the role of software in AI will consist of
- Software becoming more autonomous, detecting bugs and fixing itself, and
- Code generation tools accelerating or even replacing manual development.
Thanks to backend software development, the rise of no-code AI builders allows non-technical users to construct intelligent workflows.
Background
The Global Innovation Index (GII) includes a pillar on knowledge and technology outputs, featuring indicators such as total computer software spending as a percentage of GDP (indicator 6.2.3 in the GII). WIPO collaborates with S&P Global, Market Intelligence, a leading insights, data and technology solution provider, to track trends in software investment and digital innovation across countries. You can check GII2024 individual GII country profiles, for the United States, the People’s Republic of China, Germany, India and others. For more information, visit the GII webpage and S&P Global Market Intelligence.