IT Services Market Pulse: Week of October 28, 2026

Each week Magis Advisory reviews sector reports, deal announcements and channel research on the IT services and solutions market. Here is what stood out this week for owners thinking about growth, recapitalization or an eventual exit.

Themes this week

• Growth is in infrastructure, not services. Analysts expect IT services to grow at a mid-single-digit rate while data center spending surges. Buyers are paying for project and AI-infrastructure capability; undifferentiated managed services are harder to sell at a premium.

• Fewer deals, but sponsors are still active. Deal counts fell in Q3 across most trackers, yet private equity’s share of activity hit records. Scale still carries a meaningful multiple premium: platforms trade around 12–13x, add-ons around 9–10x.

• Consolidators are crossing borders. This month European and US platforms bought in the UK, Benelux, Ireland, France and ANZ. Owners have a wider pool of potential buyers than they may assume.

• Vendor economics are moving to consumption. Price increases and usage-based AI billing are changing how recurring revenue is built. Expect buyers to look more closely at how much of a firm’s recurring revenue depends on vendor programs.

What the numbers say

• Gartner: IT spending to grow 15% in 2027, to $7.35T (Gartner · Oct 21). IT services grow just 4.4% in 2026 and 4.9% in 2027, against 55.5% for data center systems. The headline growth is going to infrastructure, not services.

• Drake Star: Global MSP Market Update Q3 2026 (Drake Star · Oct 21). 110 MSP deals in Q3, mostly strategic buyers. Platforms trade around 12–13x EBITDA and add-ons around 9–10x.

• Moore Kingston Smith: UK IT services M&A, Q3 2026 (Moore Kingston Smith · Oct 20). UK deal count fell to a five-year low (140), but private equity was involved in a record 84% of transactions.

• Equiteq: Tech Services & Consulting M&A, Q3 2026 (Equiteq · Oct 13). Global tech services and consulting deals fell to 480 from 680 in Q2. Mid-size IT services trade at about 9.2x NTM EBITDA.

Deals worth noting

• Maximus to acquire Agile Defense for $660M (Washington Technology · Oct 19). A sponsor-backed federal IT and cyber firm with about 1,800 cleared staff exits to a strategic buyer.

• Previder enters UK with Wanstor acquisition (ITPro · Oct 27). A Dutch MSP platform buys a London MSP with about 200 staff, another case of European consolidators crossing borders for density.

• Evergreen’s Lyra acquires Dutch MSP Lantack (Business Wire · Oct 21). Evergreen’s first Benelux deal. Even a 10-person, Microsoft-focused MSP draws a programmatic buyer.

• Computacenter Q3 trading update (Computacenter · Oct 26). Profit guidance raised and a record £12.6bn product backlog. Professional Services grew while Managed Services declined.

Channel shifts to watch

• Cisco announces Nov. 7 price increases (Channel Insider · Oct 26). Mid-single-digit list increases on software and select hardware, with more partner rewards tied to recurring contract value.

• Microsoft retires AI Builder add-ons (Channel Insider · Oct 23). Bundled AI capacity moves to usage-based Copilot Credits that don’t roll over, another step from seat-based to consumption billing.

• Only 12% of MSPs report measurable AI gains (Channel Insider (Nerdio survey) · Oct 20). Just 14% have a revenue-generating AI service line. AI is still a cost and capability story for most MSPs, not yet a revenue story.

• Arctic Wolf: agentic AI now resolves 60%+ of SOC investigations (Channel Insider · Oct 27). Human-only investigations fell from 81% to 2% in a year, which puts headcount-based security service pricing under pressure.

Magis Advisory summarizes publicly available sources for informational purposes only. This is not investment, legal or tax advice, and figures are as reported by the cited publishers. Thinking about what these trends mean for your business? Start a confidential conversation.