BofA European IT Services Indicator: improvement in June

Research evidence excerpt

BofA European IT Services Indicator: improvement in June

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European IT Services

BofA European IT Services Indicator:

improvement in June

Industry Overview

Indicator improves in June 17 July 2026

The BofA European IT Services Indicator improved in June 2026 after three months of Equity

consecutive decline (see Introduction to the Indicator and the European IT Services Europe

Indicator May 2026). Five out of six components improved (US CEO Confidence, IT services

European Commission Economic sentiment indicator, EU services PMI business

expectations, global earnings revisions ratio and offshore hiring activity), which we

believe potentially reflects easing concerns about the impact of the Middle East conflict.

The Indicator’s six-month moving average slightly deteriorated sequentially. Historically,

the Indicator leads average organic revenue growth of our basket (CAP, SOP, ATE) by

three quarters. While our IT Services coverage has very limited direct exposure to the

Middle East, we continue to look for commentary on any signs of indirect impact. AdityaResearchBuddhavarapu,Analyst CFA >>

MLI (UK)

Q2 expectations: modest acceleration +44aditya.buddhavarapu@bofa.com20 7995 7318

We expect a modest improvement in organic growth for European IT services, with 1.7% Frederic Boulan, CFA >>

growth in Q2 versus 1% in Q1. While demand remains uneven and customers continue Research Analyst

to scrutinise spending decisions, activity appears broadly resilient based on comments +44 20 7995 7101

from companies at our TMT Conference in June (see note), in contrast to more cautious frederic.boulan@bofa.com

commentary from Accenture (see readacross). We continue to expect a gradual recovery Carla Courthial >>

Research Analyst