Optimism in AI drives investment

DELOITTE

Deloitte’s latest survey of UK Chief Financial Officers (CFO) shows that the overwhelming majority (net* 95%) of CFOs expect to raise spending on digital technology and assets such as software, IT and AI, both over the next 12 months and on a five-year time frame (net 97%).

The survey took place between 17th and 29th September 2024 and is the 69th quarterly survey of CFOs and Group Finance Directors of major companies in the UK.

Finance chiefs remain optimistic about AI’s ability to drive improvements in business performance, with 86% reporting either an increase in optimism or little to no change relative to this time last year.

Ian Stewart, chief economist at Deloitte, said:

Economists have been waiting for a new technology that has the potential to reboot productivity growth. If CFOs are right, AI is that technology.

Sentiment among UK CFOs has edged lower this quarter

Corporate confidence edged lower in the third quarter of 2024, following a strong bounce in optimism after the General Election. Sentiment has fallen among CFOs, with a net 6%1 feeling more optimistic about the financial prospects of their businesses now than three months ago (which was at net 23%). Despite this, confidence is still running above the long run average of net -1%.

UK CFOs also report a modest increase in uncertainty – as 31% now rate the level of external financial and economic uncertainty facing their business as high or very high, compared to 23% last quarter. This remains below the long-term average of 39%.

For more details about the CFO survey go to CFO Survey | Deloitte UK

*A number of the Deloitte CFO survey findings are presented in terms of net balances – standard practice with surveys conducted by many central banks. In the case of the CFO optimism figures, CFOs were asked whether they are now more or less optimistic about the financial prospects for their firms than they were three months ago (or if their optimism remains unchanged). The net balance (net 6%) was then computed by subtracting the percentage of CFOs less optimistic from the percentage more optimistic. Net balances can also be negative. In the case of CFO optimism, a negative reading would imply a greater proportion of CFOs are less rather than more optimistic about their firm’s prospects. Throughout this press release and the survey report net percentages indicate where net balances are used to present findings.

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