This 12 months’s CES conference has showcased one other vary of thrilling improvements: AI on each chipset, smarter endpoint gadgets and more and more savvy robots. The headlines are loud, the demos are glossy, and the longer term appears simply across the nook. However for enterprise CIOs, {hardware} technique does not proceed at show-floor pace.
CES displays what’s doable in technical gadgetry; the job of the CIO is to find out what’s sensible. {Hardware} funding selections are being made in an surroundings formed by financial uncertainty, uneven AI adoption and mounting stress to show worth from each greenback spent. Whereas staff could thrill to get their arms on the newest laptops and equipment, that is not often the wisest use of IT budgets.
Niel Nickolaisen, chairman of the CIO Council at FC Centripetal and director of strategic engagements at JourneyTeam, captured this pressure neatly: “The previous one to 2 years have been the years of CIO ‘hedging.'”
That hesitancy is just not essentially indecision; for a lot of, it is technique.
Modernization is pushed by agility, not obsolescence
For years, {hardware} refresh cycles have been predictable: new servers, new storage and new desktops each few years. However in 2026, modernization is much less about routine updates and extra about enterprise agility. Growing old {hardware} is not simply previous however a threat to efficiency, simply turning into a drag on pace and suppleness.
Nickolaisen observes this firsthand: “We have a tendency to carry onto our {hardware} for a very long time,” he mentioned, noting that infrastructure corresponding to storage arrays can stay in service properly past vendor reference lifecycles, even as much as 15 years. Extra necessary than age, he emphasised, is efficiency in context: “Due to the age of the infrastructure, it’s probably the largest barrier to enterprise agility. When we have to transfer quick, the older the legacy system is, the extra probably it’ll get in our manner.”
Business information helps this judgment. In keeping with Gartner, worldwide IT spending is forecast to extend by 9.8% in 2026; nonetheless, a lot of this growth displays rising element prices and recurring cloud expenditures quite than broad {hardware} overhauls. CIOs are below stress to modernize selectively, prioritizing the place infrastructure truly limits adaptability and holds again workflows, quite than chasing each CES novelty.
Strategic restraint is usually intentional
If modernization is prioritized for particular bottlenecks, that means de-prioritization elsewhere. In follow, this implies CIOs could delay upgrades in elements of the enterprise which are steady, predictable, or not central to innovation. Nickolaisen framed this as a deliberate selection: “To me, the choice is: The place are my greatest agility ache factors?”
For a lot of enterprises, that calculus means extending the lifetime of techniques that also meet baseline wants, whereas shifting funding towards compute and storage that instantly allow digital transformation or AI workloads. This isn’t ignorance of innovation, however a recognition that {hardware} funding should be tightly tied to enterprise influence.
IDC’s {hardware} market reporting illustrates this: AI-optimized servers — particularly GPU-accelerated techniques — noticed explosive income development final 12 months, reaching a file $112.4 billion in income within the third quarter of 2025. Nonetheless, the majority of conventional enterprise servers grew at a extra modest tempo, typically buoyed by cloud adoption quite than on-premises refresh cycles. CIOs are successfully shopping for capability the place it issues and deferring the place it does not.
This method displays a theme that has emerged in different areas of enterprise know-how: focus not on each rising functionality, however on those who unlock measurable worth.
“I’ve to stability my {hardware} modernization roadmap and priorities in opposition to the entire different calls for for know-how: new initiatives, fixing my information points, new purposes and instruments, AI,” Nickolaisen mentioned. “It may very well be that I solely have the price range and sources to tackle a small set of infrastructure modernization work.”
AI is redrawing the {hardware} precedence map
Many CIOs have been in a position to keep away from an excessive amount of {hardware} funding over the previous few years, however AI stands aside as a drive that reintroduces urgency to {hardware} technique. Purposes starting from generative brokers to high-throughput analytics place calls for on legacy infrastructure that it was by no means designed to satisfy. And whereas cloud offers a versatile on-ramp for a lot of groups, the sheer scale of AI compute means CIOs should consider when and the place devoted {hardware} yields efficiency or price benefit versus public cloud.
“For instance, I can stay with the present state of my community, however to help newer purposes I have to modernize my compute and storage,” Nickolaisen mentioned. For him, the uncertainty surrounding AI is a part of a broader market problem that makes each {hardware} determination really feel riskier.
He outlined a number of issues CIOs are weighing concurrently: “What if somebody introduces some whizbang know-how that accelerates the obsolescence of my present infrastructure? What if somebody acquires a component of my infrastructure and overhauls the licensing mannequin and pricing, and makes it much less inexpensive? What if the complete group is ‘hedging’ and won’t make investments till there may be extra market readability?”
These questions are particularly acute relating to AI, the place workloads could shift amongst on-premises infrastructure, specialised {hardware} and cloud platforms sooner than conventional planning cycles anticipate.
CES as inspiration, not obligation
CES gestures towards a future the place {hardware} and intelligence are inseparable. For CIOs, the problem is to not replicate each flooring innovation in-house, however to align enterprise actuality with strategic alternative. The best {hardware} methods can be those who harmonize between the place enterprise agility actually wants help — in information facilities, in AI workloads and in techniques that underpin buyer worth — and the place legacy techniques may be sustained with out impeding progress.
“Personally, I’ve determined that I can not management the market or know-how uncertainty, and so I’ve to be actually good at decision-making and researching the choices,” Nickolaisen mentioned. “However sooner or later I have to decide, select a path and transfer ahead — in any other case, I threat falling behind.”
