TBR estimates public sector revenue from U.S.-based service providers grew 6.1% year-to-year in 4Q23 to $5.4 billion. Total public sector revenue growth was driven by wireless revenue, which increased 9% year-to-year to an estimated $2.8 billion. First responder initiatives such as AT&T FirstNet and Verizon Frontline are the main drivers of public sector wireless revenue growth as these units are attracting public safety agencies seeking enhanced reliability to support mission-critical workloads and use cases.

While macroeconomic uncertainty challenges year-to-year revenue growth in the IT services sector, the trajectory beyond 2024 appears promising, largely due to the resilience of managed services bookings. Despite macroeconomic uncertainty the revenue growth trajectory beyond 2024 is promising, driven by the resilience of managed services bookings.

Hyperscalers and SaaS providers are clearly on the front lines of GenAI monetization, but the availability of GenAI services through cloud delivery methods will also accelerate the development of the market.