European AI spending forecast to reach $470 billion by 2030

IDC predicts European organizations will allocate nearly $470 billion to AI by 2030, with spending growing at a compound annual growth rate of 35% starting from 2025. Generative AI is expected to represent 55.4% of total spending by 2030, supported largely by adoption of agentic AI.

Regulation is shaping investment priorities. The EU AI Act’s user-facing transparency requirements and high-risk obligations became effective on August 2, 2026, with further provisions due by August 2, 2027, affecting banking, insurance and healthcare. IDC’s Carla La Croce said organizations are moving from experiments to operational and strategic deployments aimed at efficiency, risk reduction and resilience.

Software accounted for 54.9% of European AI spending in 2026 and is projected to grow 43.9% annually through 2030. AI platforms are expanding at 61.1% annually, while banking led sector spending with 12.6% of the market in 2026. Financial services accounted for 19.2% overall, and healthcare providers are projected to grow 41.0% annually through 2030.

Regional momentum remains uneven. Western Europe leads in agentic AI deployment and generative AI funding, while Central and Eastern Europe is growing above the global average through nearshore talent hubs and EU recovery funds. IDC highlighted fragmented regulation, AI talent shortages and cloud cost pressure as key constraints.