Current state of deployment services in the telecom industry

With deployment services growth tied to 5G rollouts in large markets — notably India, China and the U.S. — most vendors in TBR’s Telecom Infrastructure Services Benchmark saw segment revenue decline in 3Q24 as these markets are in post-peak 5G spend territory. The pace of India’s aggressive 5G build has decelerated since 4Q23. Ericsson outperformed its closest peers due to its Cloud RAN deployment for AT&T.
 
The deployment services market faces growing headwinds, including communication service provider (CSP) consolidation, open vRAN’s lower installation costs, and reduced demand for site location and construction (SL&C), offset somewhat by hyperscaler spend and 5G rollouts in select developing markets. Hyperscaler investments provide incremental volume to the market, and TBR notes these companies are increasing their investments in access technologies (e.g., Google Fiber).
 
Over the past few years, Ericsson, Nokia and Tech Mahindra have deemphasized deployment services to improve telecom infrastructure services (TIS) margins, and other vendors have similarly reduced their own exposure to labor-intensive deployment, especially as wage inflation accelerates. Ericsson outsourced field services in the U.S. to Authorized Service Providers effective Oct. 1, 2023. This could drive more field installation work to third-party construction firms, such as Dycom and MasTec.
 
5G RAN projects drive investment in optical transport for fronthaul, midhaul and backhaul, as well as the core network. Ciena, most notably, has capitalized on this trend. Part of the rationale for Nokia’s acquisition of Infinera is to gain greater exposure to this domain.
 
CSPs have deferred 5G core investment in general because they do not see a clear path to ROI and standards that would enable new features for the network, especially those that pertain to B2B, have been delayed. The ability to deploy 5G-Advanced services will spur only incremental growth in this area of the market.
 
TBR expects fiber deployment will increase in 2025 and 2026 as broadband services are extended to unserved and underserved areas globally, with government funds supporting CSP efforts in this area, especially in the U.S.
 

China-based leaders’ TIS revenue declined as domestic 5G RAN rollouts slowed; Nokia’s revenue decreased due to reduced activity in India and lower market share in the U.S.

Deployment services leaders

Revenue leader: China Communications Services (CCS)

CCS derives most of its deployment services revenue from the network infrastructure domain but is increasing its exposure to data center deployments to diversify. The supplier is taking market share from smaller competitors in China as well as Huawei and ZTE. CCS is aligned with and has benefited from the Chinese government’s Belt and Road Initiative, which supports international revenue.
 
Revenue declined year-to-year in 3Q24 as 5G deployment activity in China lessened, partially offset by CCS increasing its account share from its largest customer, China Telecom. TBR believes CCS’ installation work as part of 5G RAN builds is transitioning to maintenance. CCS is increasingly deploying gear in international markets such as MEA, particularly Saudi Arabia and CALA, though volumes in this region pale in comparison to the company’s presence in China.
 

Figure 1: Ten Largest Telecom Infrastructure Suppliers: Deployment Services Revenue for 3Q24

Growth leader: Hewlett Packard Enterprise (HPE)

Deployment is a noncore area of HPE’s TIS business as the company is much more concerned with monetizing maintenance services. HPE largely leaves deployment to its partner base.
 
TBR believes HPE participates in some server installs for CSP clients adopting its hardware as part of open and/or virtualized RAN deployment, such as for Telus in Canada.

Telecom infrastructure services market overview

TIS revenue continued to shrink outside North America in 3Q24 while operating margins sustained recovery

Aggregate TIS revenue among benchmarked vendors declined 2.8% year-to-year in 3Q24, falling across all segments and regions, with the exception of North America, which grew 1.9% year-to-year. North America growth was largely due to favorable comparisons to 3Q23, when aggregate revenue declined 12.9% year-to-year, but also because of AT&T’s open RAN deployment and hyperscaler investments in optical projects.
 
Conversely, several vendors, including Nokia, Ericsson, Samsung and Ciena, are seeing sharply lower revenue in APAC as India’s CSPs reduced investment following 5G RAN rollouts by Reliance Jio and Bharti Airtel. Huawei and ZTE are also seeing revenue in APAC decline due to loss of share in India as their installed bases of LTE and optical equipment are replaced by equipment from trusted vendors, as well as lower spend on 5G RAN deployments in China, which peaked in 2022.
 
As CSPs wind down 5G coverage rollouts in China, the U.S. and India in favor of densification, TIS operating margins are growing. Declining deployment activity, which tends to carry the lowest margins among TIS segments, in these markets — especially India — is the main driver of improving TIS operating margins. In 3Q24 deployment services constituted 18.2% of aggregate revenue, down 120 basis points year-to-year. Meanwhile, maintenance services, which tend to carry the highest margins among the TIS segments, grew to 34.2% of aggregate revenue, up 80 basis points year-to-year.
 
Benchmarked vendors’ aggregate TIS operating margin increased year-to-year for the fourth consecutive quarter, following six consecutive quarters of declines. Aggregate operating margin grew from 11.1% in 3Q23 to 12.4% in 3Q24. TBR expects aggregate TIS operating margin gains to continue into 2025 despite an anticipated rebound in TIS revenue in India (where margins are typically low) as new RAN agreements that Ericsson, Nokia and Samsung have with Vodafone Idea and Bharti Airtel come online, due to the relatively smaller scale of these contracts compared with initial coverage rollouts by Bharti Airtel and Reliance Jio. In addition, TBR believes the digital transformation market will recover as CSPs receive clarity on M&A, driving high-margin professional services revenue for several IT services vendors. Further, AT&T’s open RAN rollout will peak in 2025, though it will continue through at least 2026, and margins in the U.S. tend to be higher than in other countries.

TBR’s Telecom Infrastructure Services Benchmark

Telecom infrastructure services includes all external spend (capex and opex) on services by communication service providers (CSPs), including telcos, cablecos and hyperscalers, on or related to communications and IT infrastructure. For our Telecom Infrastructure Services Benchmark, TBR categorizes TIS revenue into four main segments: deployment services, professional services, maintenance services and managed services.
 
Vendor coverage for this research includes, but is not limited to, Amdocs, CGI, Ciena, Ericsson, Fujitsu, Infosys, Juniper, Nokia, Oracle, Samsung, Tech Mahindra and ZTE.
 
Download a free preview of TBR’s latest telecom infrastructure services research: Subscribe to Insights Flight today!

Moratorium on PwC business tells cautionary tale

My previous and current careers collided last week when the Kingdom of Saudi Arabia’s Public Investment Fund (PIF) announced a one-year moratorium on doing business with PwC (details continue to emerge even as I type this and the exact contours of the new Saudi PIF and PwC arrangement will likely shift, so I won’t try to evaluate a moving target). Having spent 13 years as a U.S. diplomat — including living in the Middle East for four years and taking at least a dozen trips to Saudi Arabia while working at the U.S. State Department, White House, and Department of the Treasury — I have some thoughts on how business and politics work in that region. I’ve also spent almost two decades trying to understand the Big Four firms, and I recently sat down in Washington, D.C., with some of PwC’s leadership to discuss the market, the firm’s ecosystem and what’s coming in 2025.
 
Bottom line upfront: Understand that this is a Saudi story, not a PwC story, although undoubtedly it doesn’t feel that way in PwC’s corridors right now. Saudi Arabia has an opportunity to send some critical messages to players in the country, in the region and globally, and the kingdom is taking advantage. If you’re among the many IT services companies and consultancies — and other multinational companies, although they’re less of a concern to me professionally right now — investing aggressively on growth in the Middle East and you’re misinterpreting this recent development as what PwC did wrong instead of listening to what the Saudis are trying to say, take a long pause and step forward only cautiously.
 

What are the Saudis saying?

First, the Saudis, through the PIF, have issued a warning — a shot across the bow — to management consultancies, IT services companies and others that have been enjoying a seemingly relentless flow of funds from the kingdom: Tighten up your accounts, sharpen your delivery, ensure your value proposition and the Saudis’ return on their investment in you will be abundantly clear. The McKinsey & Co., Boston Consulting Group and Deloitte partners may be enjoying some schadenfreude at the moment, but they understand the message coming from the Saudis: Bring tangible value, or don’t send us a bill.
 
Second, the Saudis have been feeling the positive heat of the world’s economic attention for a few years now, particularly as new leadership has pushed hard to invigorate the non-oil part of the kingdom’s economy. I wrote recently about what that has looked like in the United Arab Emirates — based on a webcast by PwC, coincidently — and for the Saudis, the initial success of those efforts and the increased global market and investor attention have been welcomed. What better time to send a message that Saudi Arabia has a transparent, high-functioning, rules-based economy, long since evolved from the souks of the old days and the opaqueness that characterized so much of the kingdom as late as the mid-2000s?
 
The Saudi Arabia and PwC story serves that purpose perfectly: We’re holding accountable a Big Four accounting and consulting firm and subjecting them to our high standards, just like every other advanced economy. The particulars of the kingdom’s regulatory environment and business culture can certainly be up for discussion, but the message, again, is clear: Everyone needs to play by the Saudis’ rules.
 
And maybe that’s the biggest takeaway as this story develops. Operating in the Middle East requires local knowledge, a regional presence, and an on-the-ground understanding that can only be sustained by being there. Yes, I am writing this 6,303 miles from Riyadh, but lessons learned hard are lessons long remembered, even over long distances. TBR has seen a surge in IT services companies’ and management consultancies’ investments in the Middle East and heard expectations around growth in the near term.
 
In my view, those investments and expectations are smart strategies and well founded. It’s the execution that matters, and a significant — perhaps the most significant — part of that execution comes from knowing the ground, reading the messages being sent, and understanding the story behind the story.

Updated Feb. 26, 2026

Revenue growth acceleration among the top 10 IT services revenue leaders reflects execution and demand mix advantages rather than market recovery

Eight of the top 10 IT services revenue leaders in TBR’s IT Services Vendor Benchmark reported accelerated positive trailing 12-month (TTM) revenue growth year-to-year in U.S. dollars (USD) during 3Q25, indicating vendors are capturing pockets of growth opportunities despite lingering growth challenges caused by macroeconomic uncertainty, tight discretionary spending, and constrained spending in the U.S. federal sector.
 
Skills rotation, amplified by the announced business optimization program in 3Q25, will enable Accenture to meet shareholders’ short- to mid-term expectations. The reaccelerated pace of acquisitions during 3Q25 aligns with Accenture’s proven playbook but also raises expectations for the company to drive upper-midsingle-digit organic growth in FY26 and beyond, post-integration.
 
IBM Consulting accelerated revenue growth year-to-year in 3Q25 due to its emphasis on client trust, flexible and open platforms, sustained innovation, deep domain expertise and an expanded partner ecosystem. IBM Consulting will sustain its expansion in AI due to IBM’s early advances in the segment and ability to showcase results from internal AI adoption as client zero. IBM Consulting’s GenAI bookings reached more than $1.5 billion in 3Q25, and the number of engagements more than doubled year-to-year. In comparison, Accenture reported GenAI bookings of $1.8 billion in 3Q25, up from $1.5 billion in 2Q25.
 
Fujitsu’s revenue grew as the company continued to benefit from modernization and digital transformation demand in Japan. Fujitsu continually invests in Japan-based, innovative partnerships, which drive growth opportunities but limit global visibility. Fujitsu, RIKEN and NVIDIA announced a collaboration on the AI-HPC supercomputer, FugakuNEXT, expected to be operational in Kobe, Japan, by 2030. TBR expects Infosys’ growth will remain in the midsingle digits in the next two years, largely fueled by converting large and mega outsourcing deals into cash.
 

Top 10 IT Services Revenue Leaders: TTM Revenue (Source: TBR)

While stable revenue rankings underscore the difficulty of displacing IT services incumbents, acquisitions could cause movement among adjacent peers in the case of Capgemini and IBM in 4Q25

Accenture, NTT DATA and TCS retained their No. 1, No. 2 and No. 3 revenue contribution positions, respectively, compared to 2Q25

We do not anticipate Accenture will lose its No. 1 position in revenue anytime soon, even in the highly unlikely scenario that NTT DATA and Tata Consultancy Services (TCS) merge their operations. While Accenture is calibrating its operating model toward that of a software-like company to capture agentic AI-driven opportunities, a key strategy for TCS is increasing wallet share among lower-spending clients by building trust and offering competitive, in-demand technology solutions.

IBM and Capgemini retained their No. 4 and No. 5 revenue contribution positions, respectively

Strong relationships and collaborations with partners will strengthen IBM Consulting’s position as the link to IBM’s hybrid cloud and AI platforms. The completed acquisition of WNS will jump-start Capgemini’s intelligent operations model and provide an inorganic boost to Capgemini’s revenue, which will reach an estimated $6.9 billion in 4Q25 and surpass IBM’s revenue of $6.7 billion, according to TBR estimates.

Cognizant and Infosys retained their No. 6 and No. 7 positions, respectively, compared to 2Q25

Crossing $5 billion in quarterly revenue in 3Q25 for the first time in its history highlights Infosys’ ability to leverage the trust it has built within the ecosystem during a time when many of its peers are facing downward pressure.

IT services market outlook

Low single-digit growth persists as IT services activities shift toward efficiency, managed services and selective modernization

TBR estimates TTM revenue growth for the benchmarked IT services vendors will be 2% year-to-year in 2025, an increase over 2024 revenue growth of 0.9% year-to-year.
 
Enterprises remain cautious, prioritizing short-term ROI, phased programs and vendor accountability over large, multiyear commitments. Revenue growth acceleration is increasingly tied to AI-enabled scope expansion, core systems modernization and long-term managed services contracts rather than discretionary budgets. Enhancing managed services activities enables IT services providers to increase client stickiness, a necessary strategy to weather competitive threats.
 
Although consulting and systems integration demand have been pressured by tight discretionary spending, activity is stabilizing as clients selectively fund modernization initiatives tied to efficiency and risk mitigation. AI adoption and IT services delivery continue to support productivity and profitability improvements but will not materially accelerate top-line growth in the near term.
 
Uncertainty around measures taken by the Department of Government Efficiency negatively impacted vendors’ performance in the U.S. federal sector in 1H25. However, these measures will create growth opportunities for established IT services providers in the public sector around system efficiency improvement; technology modernization to enhance citizen services and reduce waste; and adoption of AI by government agencies. IT services providers are also experiencing revenue growth in the public sector in areas such as data and digital sovereignty and cybersecurity.

Explore deeper data and analysis

TBR’s IT Services Vendor Benchmark delivers unique insight and value through in-depth analysis in a concise, consumable format. This quarterly research program covers 30 leading vendors in the IT services segment and analyzes their go-to-market strategies; investments, alliances and acquisitions; and resource management and financial performance. An updated Excel data pivot table is also published with each edition of the benchmark.
 
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TBR has been tracking performance of IT services companies for decades. As go-to-market strategies increasingly focus on industry-centric solutions, TBR determined to build trailing 12-month revenue based on a standardized breakout of key industry verticals.
 
In 2018 we expanded our IT services coverage to include estimates for seven industry vertical splits (full list below), leading to the recent launch of the IT Services Industry Vertical Data Excel file. This extensive data file includes revenue estimates for 17 IT services companies, including Accenture, Capgemini, DXC Technology, IBM and Tech Mahindra (full list below). Quarterly estimates, year-to-year growth, and percentage of IT services totals date back to 1Q21.
 
This proprietary data stream, in conjunction with our qualitative analysis of these firms, including their partners and how they operate, offers unprecedented intelligence on which companies are growing or maintaining their revenue or experiencing declines within industry verticals and allows for partner adjustments and competitive maneuvering.

TBR’s vertical-specific IT services data reveals notable industry trends

In the most recently published data file, several key insights stand out, including highlights from TBR’s research on Tata Consultancy Services (TCS), Capgemini and Wipro.

Most notable: TCS’ public sector success in India

Tata Consultancy Services’ (TCS) public sector revenues jumped 52.2% year-to-year in 3Q24, extending — and accelerating — five straight quarters of double-digit growth. Curiously, however, TBR’s data shows a deviation from the norm in geo data. Reported India revenues by TCS (as a percentage of revenue) have been growing at a mid-double-digit range for over a year. In fact, reported revenue has grown so rapidly that India generated more revenue for TCS than the rest of the Asia Pacific region combined for the first time in 3Q24, and that gap expanded in 4Q24.
 
While it is unquestionably an impressive growth story, public sector revenue accounts for less than 5% of TCS’ overall IT services revenue, making it strong growth from a relatively small base. Still, 52.2% is impressive relative to the market, and analysis in TBR’s quarterly reports on TCS can help us understand this success. In short: It’s India.

• “India was again a bright spot for TCS, nearly doubling its revenue composition from the previous year, now accounting for 8.9% of total TCS revenue. We attribute the growth in India to strong brand reputation and favorable government policies to incentivize companies to digitize their IT operations.” — TBR’s 3Q24 Tata Consultancy Services report
• “Although India has historically only accounted for 5% to 6% of TCS’ total revenue, we anticipate this share will rise over the next few years, reaching double-digit figures before peaking and stabilizing. IT spending in India continues to increase, indicating there is plenty of opportunity, particularly for locally based IT services firms such as TCS. For example, during 2Q24 TCS and Indian state-owned telco Bharat Sanchar Nigam Limited announced plans to build four data centers across India to meet rising demand.” — TBR’s 2Q24 Tata Consultancy Services report

 
According to TBR’s lead analyst on TCS, Senior Analyst Kevin Collupy, “They are killing it with local Indian enterprises and government organizations. And last year we reported on an uptick in consultancies and IT services companies investing in their India-for-India capabilities, offerings and scale. So, 52.2% growth in public sector, even as TCS itself only grew 6.4%, tracks with the overall India growth story while illustrating just how well TCS has been doing.” ​

Additional insights from 3Q24 data

Capgemini’s revenue declined 1% year-to-year in U.S. dollars (USD) in 3Q24, but the company’s public sector revenue increased by more than 4% in the same period. At 15.1% of the company’s total IT services revenue, public sector revenue significantly buoyed what would have been an even rougher quarter. Retail, CPG, Travel & Transportation declined 4% year-to-year in USD in 3Q24 and accounted for 15.1% of Capgemini’s IT services.
 
Wipro’s 19.1% drop in public sector revenue in 3Q24 looks terrible, particularly in the context of an overall IT services decline of just over 2%. The vertical did not pull down Wipro as a whole though, as it represents just 0.5% of total revenue. The real culprits were Financial Services (down 1.3%, while accounting for 33.9% of revenue) and High Tech, Communications & Media (down 8.1%, at 15.4% of revenue).

Access all IT services vertical-specific data

While a single quarter is only a snapshot of the market narrative, the numbers in TBR’s vertical-specific IT services data starts to paint the picture while company reports fill out the story. An updated IT Services Industry Vertical Data Excel file will be released quarterly in TBR’s digital platform, Insight Center™.
 
If you are a current TBR user with access to the IT Services Vendor Benchmark, you can download the IT Services Industry Vertical Data Excel file today.  If you’re interested in gaining access to the data, as well as TBR’s entire IT services research stream, start your free trial to Insight Center™.
 
Vendors covered in TBR’s IT Services Vendor Benchmark Data:

• Accenture
• Atos
• Capgemini
• CGI
• Cisco Customer Experience
• Cognizant
• DXC Technology
• Fujitsu
• HCLTech
• Hewlett Packard Enterprise Services
• IBM
• Infosys
• Kyndryl
• Tata Consultancy Services
• Tech Mahindra
• T-Systems
• Wipro IT Services

Industry coverage in TBR’s IT Services Vendor Benchmark Data:

• Financial Services
• Healthcare & Life Sciences
• High Tech, Communications & Media
• Industrial Solutions, Manufacturing, Automotive, Energy, Utilities & Chemicals
• Other Industry
• Public Sector
• Retail, Consumer Packaged Goods (CPG), Travel & Transportation

Atos showcases strength in manufacturing industry specialization

Although it is an understatement to say Atos has struggled with its financial performance in recent years, the new year gives TBR analysts a chance to look for signs of change or markers indicating that Atos’ strategic decisions, investments and leadership adjustments have put the company on the path to sustained and profitable revenue growth in the coming years. We are paying close attention to Atos’ enhanced and deepened partnerships with technology companies, its major multiyear deal signings, and the use cases Atos’ two business lines — Eviden and Tech Foundations — tout as indications of what is working well and where they are gaining additional traction (and traction equals growth).
 
Along with the usual digital security solutions, cloud migrations, platforms and advanced computing implementations, one recent use case stood out, surprisingly not only for what Eviden did but also for what the organization positioned its client to do in the future. As part of a five-year engagement, Eviden helped Spanish train manufacturer Talgo develop what Eviden called a “state-of-the-art fleet monitoring system” that can ingest and process massive volumes of data, bring information and insights to train maintenance engineers, and “achieve architectural flexibility and scalability to incorporate modern train series without additional development efforts.” While the first few elements should be considered core capabilities of any modern, AI-enabled, and purpose-built system, the last one addresses a customer sentiment we have been hearing relentlessly for the last 18 months: Make my current technology work better without additional investment in even more new technology.
 
But that is not what jumped out at TBR as something special and a marker of potentially good things to come.

Reselling the TSMART solution creates new revenue streams for Talgo

Eviden’s work with Talgo produced the fleet monitoring system Talgo SMART Maintenance (TSMART). In recent years TSMART has been improved with capabilities such as predictive maintenance and visualizations. So far, so good, and so much like most others.
 
There is a significant difference, though, as Eviden noted in the press release: “Long an aspiration of smart manufacturing, the ability to create value-adding services from products is now Talgo’s reality. TSMART can be enhanced with product packaging/branding to be offered as a service to third parties. Talgo can easily extend the TSMART system to new train series or offer it to customers as a service. Its customizable interfaces include options for company branding and user personalization as well as new train configurations.”
 
Eviden helped create more than just an asset for Talgo to use internally and benefit from increased productivity, operational safety and fleet reliability. Now Talgo can expand its offerings with its own clients, develop a new business model, create new revenue streams, and, likely, greatly enhance its stickiness and position across its ecosystem. Not every IT services engagement leads to a client creating a new business opportunity, but this one did.

Now, can Eviden recreate the success of TSMART with other clients? Can this become a calling card for Eviden, an example of what can separate the organization from peers?

Certainly not with every client and every engagement — routine designing and building of systems are just that, routine — but if Eviden brings the mindset behind TSMART into opportunities, particularly with long-standing clients in the manufacturing and energy industries, TBR anticipates a quicker return to revenue growth for Eviden, which will support Atos’ overall financial performance.
 
Atos has established expertise around delivering predictive maintenance solutions and is applying its skills across industries. The company is working with multiple clients in the theme park and attractions industry, utilizing data and AI as well as edge server technologies to reduce the downtime of rides and improve customer satisfaction. For example, in 2020 Atos won a deal with the Triple Five Group’s American Dream entertainment complex to provide predictive maintenance utilizing data analytics and AI solutions as well as BullSequana Edge servers to collect and store data from ride sensors and detect issues through real-time analytics at the edge.
 
In covering Atos and its two business lines, Eviden and Tech Foundations, TBR publishes a quarterly Atos report and a semiannual Atos Cloud report. TBR also includes the company in our quarterly IT Services Vendor Benchmark, AI and GenAI Market Landscape, and various ecosystem intelligence and digital transformation reports, as warranted by Atos’ investments and activities in those areas. Access all of this research and more with your Insight Center™ free trial. Sign up today!