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Worldwide Enterprise Applications Revenue Grew 12.0% in 2023 and Is Forecast to Surpass $600 Billion in 2028, According to IDC

#CRM--The enterprise applications market delivered solid revenue growth in 2023 as artificial intelligence (AI), and particularly generative AI (GenAI), has started to reshape the employee and custome...

Business Wire

NEEDHAM, Mass.: #CRM--The enterprise applications market delivered solid revenue growth in 2023 as artificial intelligence (AI), and particularly generative AI (GenAI), has started to reshape the employee and customer experience of business software. According to a new report from International Data Corporation (IDC), the enterprise applications market grew 12.0% year over year in 2023 with worldwide revenues reaching $356 billion.

The integration of AI and GenAI into enterprise applications brings more intelligence, faster time to insights, and enhanced decision velocity to users. As a result, employees can have a greater reliance on enterprise software as a coworker to help solve business problems and navigate the dynamic world of change. All of this is possible with increased reliance on cloud technology as the foundation from which to innovate fast, quickly changing up the employee, customer, and partner experiences resulting in faster time to value and competitive differentiation.

"SaaS and cloud-enabled applications continue their growth across the enterprise applications market. With new innovation such as generative AI and its plethora of use cases, the opportunity to reshape businesses with intelligent technology using cloud applications brings greater competitive advantage," said Mickey North Rizza, group vice president, Enterprise Software at IDC. "Experience-orchestrated (X-O) businesses are leveraging more modern, innovative, and intelligent enterprise applications, improving their decision velocity with smarter business decisions and ultimately bringing greater differentiation for organizations globally."

The top 5 enterprise application vendors in 2023 were SAP, Salesforce, Oracle, Microsoft and Intuit, which together accounted for 21.2% of worldwide revenues. With just 0.2% of market share separating SAP and Salesforce, IDC regards these two companies as statistically tied for the number 1 position in the worldwide enterprise applications market for 2023. (IDC declares a statistical tie in software competitive markets when there is a difference of 0.5% or less between the market share of two or more companies.)

IDC forecasts worldwide revenues for the enterprise applications market will be more than $600 billion in 2028 as organizations further integrate traditional AI, machine learning, and GenAI into workflows, creating faster and more intelligent insights and decisions. Organizations will also invest in new tools to keep their application portfolio up to date as they move further into the digital era. Meanwhile, public cloud will become the foundational deployment model for enterprise applications software, accounting for more than 70% of new enterprise applications spending in 2028. Demand for public cloud-based enterprise applications is forecast to produce a five-year compound annual growth rate (CAGR) of 16.5%, surpassing the 11.1% CAGR for the overall market.

The enterprise applications market is comprised of the following secondary markets: enterprise resource management (ERM), customer relationship management (CRM), engineering applications, supply chain management (SCM), and production applications. Each of these secondary markets consists of multiple functional markets.

IDC's software market sizing and forecasts are presented in terms of commercial software revenue. The term commercial software is used to distinguish commercially available software from custom software. Commercial software revenue typically includes fees for initial and continued right-to-use commercial software licenses. These fees may include, as part of the license contract, access to product support and/or other services that are inseparable from the right-to-use license fee structure, or this support may be priced separately. Upgrades may be included in the continuing right of use or may be priced separately. Commercial software revenue excludes service revenue derived from training, consulting, and systems integration that is separate (or unbundled) from the right-to-use license but does include the implicit value of software included in a service that offers software functionality by a different pricing scheme.

The IDC report, Worldwide Enterprise Applications Software Market Shares, 2023: Cloud Foundation Brings Preparedness for AI (IDC #US51079524), reviews the vendor market shares for the worldwide enterprise applications software market for 2023. The report provides worldwide revenue, market share, and year-over-year growth for more than 400 enterprise application vendors. The report also provides a breakdown of enterprise applications revenue by geographic region and deployment type (public cloud vs. on premise).

The IDC report, Worldwide Enterprise Applications Software Forecast, 2024–2028: AI Everywhere World Brings Intelligence and Experience-Orchestrated Applications (IDC # US51079424), provides IDC's five-year forecast for the enterprise applications software market. The report also provides a forecast for enterprise applications revenue by deployment type (public cloud vs. on premise) and geographic region. The forecast data in this report is based on IDC's Worldwide Semiannual Software Tracker.

About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,300 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC Blog for industry news and insights.

Fonte: Business Wire

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