Some new managed services data to kick off our day.
JumpCloud has released its first report focused on managed service providers, revealing that while 89% of these providers experienced revenue growth in 2024, only 22% achieved high growth, defined as an increase of over 20%. The report highlights key characteristics of successful providers, such as a willingness to adopt new technologies and embrace artificial intelligence in their operations. The 2025 MSP Performance Report indicates that high-growth managed service providers are more likely to manage complexity effectively and implement strong security policies.
The managed services market is experiencing significant growth in 2025, driven by advancements in artificial intelligence and a surge in merger and acquisition activity. In the first quarter alone, over 100 deals were made public, surpassing a billion dollars in disclosed value, according to the Drake Star Q1 2025 MSP Market Update. Artificial intelligence is transforming how managed service providers operate, enhancing efficiency and enabling faster customer support. Companies like Zofiq have reported a 50% reduction in ticket workloads and a 30-50% decrease in operating costs due to automation. Investors are particularly interested in firms that integrate AI into their services, as seen with Sophos acquiring Secureworks for $859 million and Thrive securing $1.5 billion in funding from Berkshire Partners to expand its AI capabilities.
A significant infrastructure shift is underway in enterprise networks as organizations adapt to the demands of artificial intelligence and data-driven workloads. A recent study by Cisco reveals that 97% of IT leaders consider a modernized network crucial for implementing AI, Internet of Things, and cloud solutions. The research highlights that 98% of respondents view secure networking as vital for operations, with over 61% deeming it critical for growth. Additionally, 95% emphasize the need for resilient networks, especially as 77% have experienced major outages caused by congestion and cyberattacks. Cisco’s CTO, Chintan Patel, states, “The network has powered every wave of digital transformation,” underscoring the urgency for IT leaders to build networks that will define their organizations’ future in the AI era. As enterprise networks evolve, the emphasis on smarter, more secure, and adaptive infrastructures is clear, with 89% of leaders anticipating that improved networks will directly drive revenue.
Why do we care?
The data marks a line in the sand for managed service providers: operational maturity powered by AI and network transformation is what separates high-growth providers from the rest. Simply selling tools isn’t enough. The winners are building intelligent service delivery platforms that actively reduce costs, increase speed, and mitigate risk.
For IT services professionals, this means:
- Repositioning around outcome delivery, not just technical capability.
- Leaning into AI not as a bolt-on, but as a foundation of internal workflows and external client value.
- Prioritizing secure, modern infrastructure—not just for compliance, but for growth.
Those who fail to evolve risk becoming commoditized caretakers of infrastructure while others reap strategic advisory revenue. The AI-enabled transformation isn’t coming—it’s already being monetized.