Major players in the Zacks Computer – Integrated Systems industry, including IBM, HPE, Agilysys, and PAR Technology, are adjusting to ongoing challenges such as supply chain bottlenecks and inflation. In the past year, the industry returned 17.9%, underperforming the S&P 500’s 23.3% and the broader Computer and Technology sector’s 32.4%. Demand for integrated solutions, particularly in cloud computing and AI technologies, remains robust, with Gartner projecting a recovery in global IT spending, which could propel industry growth.
The industry faces significant hurdles including persistent order backlogs and the semiconductor chip shortage, which is hampering production capabilities. Additionally, foreign exchange volatility poses further challenges amidst a tough macroeconomic environment. The industry’s Zacks Rank stands at #77, indicating it is in the top 31% of over 250 Zacks industries, suggesting some potential for near-term outperformance despite current challenges.
Looking ahead, companies are investing heavily in data modernization and integrated cloud solutions. Notably, IBM is expanding through several acquisitions to enhance its hybrid cloud offerings, while both HPE and PAR Technology are adapting their business models to leverage the rise of AI and cloud technologies. As the industry continues to adapt, its capacity to overcome supply chain and economic challenges will crucially determine its future success.
