Investing.com — The IT Operations (ITOps) market, once seen as a cost center limited to back-office functions, is undergoing a deep transformation driven by artificial intelligence and automation, according to a note from Raymond (NS:) James.
The company estimates that the sector will grow to $125 billion by 2028, an annual growth rate of 13% from $80 billion in 2024.
Raymond James highlights the shift in the role of ITOps from back-office support to a critical business engine, with platforms such as ServiceNow (NYSE:) gaining prominence among C-suite executives for streamlining operations and enabling differentiation. The increased reliance on AI to automate redundant tasks and optimize workflows has positioned the sector for sustainable double-digit growth, attracting investor interest despite a challenging macroeconomic backdrop.
The report notes that valuation ratios for ITOps companies have fallen and are now trading in line with broader technology indices, such as the Technology Select Sector SPDR Fund (XLK). However, Raymond James sees this as an attractive entry point for investors, highlighting the potential for significant shareholder value creation through a cycle of growth, profitability and reinvestment.
The ITOps ecosystem includes several submarkets, including IT Service Management (ITSM), Health Performance and Analysis (HPA) and Artificial Intelligence for IT Operations (AIOps):
ITSM – The ITSM market, valued at over $7 billion, is expanding in the low to mid-teens, driven by the consolidation of spend across core platforms and the integration of AI capabilities. ServiceNow remains a leader with a market share of almost 50%, followed by competitors such as Atlassian (NASDAQ:), which leverages its Jira ecosystem.
HPA This market is estimated at $22 billion and supports the performance of IT infrastructure and applications, with submarkets such as Application Performance Monitoring (APM) and observability showing high growth. Organizations’ shift to cloud-based systems and the importance of real-time performance monitoring are key growth drivers.
AIOps – At $2 billion, the AIOps segment is growing in the mid-to-high teens. By using AI to analyze massive amounts of IT data, this technology improves decision-making and accelerates problem resolution. Raymond James expects AIOps to increasingly integrate with ITSM platforms.
