IT Outsourcing - Portugal

Portugal

The IT Outsourcing market in Portugal is expected to witness significant growth in the coming years.
According to projections, the revenue in this market is anticipated to reach US$1.09bn by 2024.
This indicates a promising future for the IT outsourcing sector in Portugal.
Furthermore, the market is forecasted to exhibit a steady annual growth rate of 7.84% from 2024 to 2029, resulting in a market volume of US$1.59bn by the end of the forecast period.
This substantial growth is a testament to the increasing demand for IT outsourcing services in Portugal.
When considering the average spend per employee in the IT Outsourcing market, it is estimated to reach US$198.60 in 2024.
This figure highlights the value that companies are willing to invest in outsourcing their IT needs, further driving the growth of the market.
In the global context, it is worth noting that United States is expected to generate the highest revenue in the IT Outsourcing market, with an estimated figure of US$197.30bn in 2024.
This emphasizes the dominant position of the United States in this market segment, while also showcasing the potential for growth in Portugal's IT Outsourcing market sector.
Overall, the projections for the IT Outsourcing market in Portugal indicate a promising future, with significant revenue growth and a rising demand for IT outsourcing services.
Portugal's growing reputation as an emerging IT outsourcing destination is driven by its skilled workforce and competitive costs.

Key regions: Brazil, Italy, United States, China, Germany

Definition:
The IT Outsourcing market refers to the external contracting of IT functions, services, or projects instead of relying on company-owned resources. By outsourcing IT tasks (e.g., to IT suppliers or software developers), enterprises are able to focus on their core functions and save internal resources and costs (e.g., office space, maintenance, and utilities). Thus, outsourcing teams becomes a viable cost resilience strategy in an environment where companies are looking to save money more than ever.

In an IT context, these activities include IT administration, IT application, and web hosting services. Non-IT-related outsourcing services are excluded.

Structure:

IT Outsourcing contains four distinct markets that are based on different services:

Administration Outsourcing refers to the market for services associated with the external sourcing of typical IT administration tasks such as hardware supply, setup, configuration, maintenance, security, and support.
Application Outsourcing refers to the market for all IT application services in a software production context, spanning from requirement assessments to concept and design of software applications.
Web Hosting includes all types of internet hosting services that allow companies or individuals to provide access to their web page via the World Wide Web.
Other IT Outsourcing refers to aggregated revenues of the types of IT outsourcing that are not specifically mentioned in the other IT Outsourcing markets, such as infrastructure outsourcing, network outsourcing, and managed services.

Additional Information:

The IT Outsourcing market comprises revenues, revenue change, average spend per employee, and revenues of the outsourcing types. Market values represent revenues that are generated by primary vendors either directly or through distribution channels at the manufacturer price level (excluding VAT). Reported market revenues include spending by enterprises (B2B) and governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed. Key players in the market include IBM, Accenture, Capgemini, NTT, and Hewlett Packard Enterprise.

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Market

Region

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Currency

Analyst Opinion

Portugal, a country famous for its port wine and delicious seafood, has been experiencing a steady growth in its IT Outsourcing market in recent years.

Customer preferences: The Portuguese IT Outsourcing market has been driven by the increasing demand for software development and maintenance services from various industries, including healthcare, finance, and manufacturing. Additionally, Portuguese companies are increasingly looking to outsource their IT services to reduce costs and increase efficiency.

Trends in the market: One trend in the market is the rise of nearshore outsourcing, where companies outsource their IT services to countries that are in close proximity to their home country. Portugal’s location and time zone make it an attractive destination for nearshore outsourcing for companies in Europe and the United States. Additionally, there has been a shift towards cloud computing, big data analytics, and artificial intelligence, which has led to an increase in demand for IT services in these areas.

Local special circumstances: Portugal’s government has implemented several initiatives to promote the growth of the IT Outsourcing industry. For example, the government has introduced tax incentives and grants to attract foreign companies to invest in the country. Additionally, Portugal has a highly skilled workforce, with many universities offering courses in computer science and engineering.

Underlying macroeconomic factors: Portugal’s economy has been recovering in recent years, with GDP growth averaging around 2% annually. This has led to an increase in foreign investment and a more stable business environment. Additionally, Portugal is a member of the European Union, which has led to increased trade and investment in the country. In conclusion, Portugal’s IT Outsourcing market has been growing steadily due to the increasing demand for IT services, the rise of nearshore outsourcing, and the government’s initiatives to promote the industry. With a highly skilled workforce and a stable business environment, Portugal is well-positioned to continue its growth in the IT Outsourcing market.

Methodology

Data coverage:

The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.