The Russian IT market has proven resilient since the mass exodus of Western vendors in 2022. It has not only stabilized but transformed. However, the industry has moved from the “frenzied” import substitution phase into a new era of pragmatism where cybersecurity, artificial intelligence, and measurable return on investment are the primary drivers.
📊 Market Size and Growth Trajectory
The Russian IT market has grown substantially, from 2.06 trillion rubles in 2021 to 3.86 trillion rubles in 2025. It is projected to reach 4.44 trillion rubles in 2026 and could nearly double to 6.75 trillion rubles by 2030. Its share of GDP is expected to approach 3%.
However, growth is slowing significantly. The software industry grew 14% in 2025, down from 20-25% in previous years, and is expected to grow 17% in 2026—primarily driven by price increases rather than expanding demand. Some 61.3% of software companies expect revenue growth, but this is a much lower percentage than in previous years, and over 20% of developers may face revenue decline in 2026. The industry is bracing for a potential wave of bankruptcies among small and medium-sized players.
🔑 Key Drivers and Priorities
Cybersecurity: The Top Priority
Cybersecurity has become the dominant priority. 66% of surveyed CIOs in large Russian companies identified it as a key objective for 2026. This is driven by a surge in cyberattacks—over 100,000 were recorded in 2025, nearly double the previous year, with one in five being critical. The cybersecurity market is valued at 469 billion rubles in 2026 and could reach 968 billion rubles by 2030. Security is no longer a separate line item but a prerequisite for AI projects, digital transformation, and software import substitution.
Artificial Intelligence: The Pragmatic Engine
AI is rapidly moving from hype to practical implementation. 67% of CIOs cite AI and automation as key priorities, and 65% of companies have increased IT budgets in 2026, with AI as the primary investment direction. Companies are using AI primarily for internal efficiency—analytics (69%), document management (58%), and software development (54%)—rather than customer-facing applications (only 17%). For example, T1 Holding reported saving 1 billion rubles in 2025 by using an AI assistant for 5,000 developers.
Cloud and Infrastructure: Hybrid Models Dominate
The cloud market is growing, but hardware shortages and cost pressures are driving hybrid strategies. As of early 2026, the server market faced acute shortages with prices for server DRAM quadrupling since summer 2025 and NAND flash up 25% by February 2026. Delivery times for equipment to Russia stretched to 8-10 months. Under these conditions, businesses are pursuing hybrid models—stable workloads on purchased or leased hardware, and variable loads, development, and testing on public cloud. The Bare Metal Cloud segment grew 33.1% in 2024 to 14.2 billion rubles, driven by AI workloads requiring high-performance GPUs.
🏗️ Industry Transformation and Challenges
Import Substitution: From “Replacement” to “Development”
The peak of the “emergency” import substitution phase has passed. The focus has shifted from simply finding a quick replacement to ensuring quality, functionality, performance, and integration capabilities. Companies are now expected to compete more naturally, with fewer state support mechanisms. However, this transition has created a “seller’s market” in certain segments. Licenses for certified Russian software rose 10-20% in Q1 2026, with limited choice and quality often falling short of expectations. Some industry experts also argue that Russia has over 70 operating systems listed in the state registry, spreading resources too thinly instead of focusing on a few strong “cores”.
The Talent Shortage
The most significant barrier to IT development is the shortage of qualified personnel, cited by 83% of surveyed CIOs. No respondents cited a lack of technology or business interest as a major obstacle. This talent crunch is likely to intensify as the industry demands higher-skilled specialists for AI and security projects.
Hardware: A Secondary Concern
Hardware remains a secondary issue for many. While the software market grows, some estimates suggest the equipment segment will face stagnation or very moderate growth. The high cost of capital and cautious spending by large customers further constrain hardware investment.
Export: A Partner Model, Not a Product Model
Russian software exports are recovering but changing shape. They grew modestly in 2025 and are expected to grow 9% in ruble terms and 7% in dollar terms in 2026. However, the “sell a boxed product” model is increasingly ineffective. Foreign clients in friendly countries want not just a product but technology transfer and a local partnership. Russian companies are moving toward shared teams, joint ventures, and collaborative development to sustain international revenue.
🔭 Outlook
The Russian IT market is not collapsing, but it is entering a period of slower, more complex, and more competitive growth. The structural transformation is complete, but the industry must now mature and face the realities of a pragmatic, efficiency-driven environment. The winners will be those that can balance:
- Cybersecurity as a fundamental requirement for any project.
- AI integration for concrete, measurable gains in efficiency.
- High-quality software and hardware that can genuinely compete on functionality, not just price.
- A pragmatic approach to infrastructure, balancing on-premise and cloud resources.
- Talent acquisition and retention in a fiercely competitive market.
The “nursery period” of easy state support is over; the test of true competitiveness has begun.
