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A global study from NTT DATA has found that just 14 per cent of organisations have reached the highest level of cloud maturity, despite nearly two decades of cloud adoption, raising questions about whether enterprises can deliver on their AI ambitions without addressing foundational gaps.
The report, titled Cloud-led Innovation in the Era of AI, is based on a survey of more than 2,300 senior decision-makers across 33 countries and 13 industries, including 100 respondents from Australia.
AI is increasing cloud dependency
The central finding is a paradox. While 99 per cent of organisations say AI is increasing their demand for cloud investment, 88 per cent acknowledge that current investment levels are putting AI, cloud-native and modernisation initiatives at risk.
Cloud spending has flatlined, with 84 per cent of organisations reporting no change in cloud budgets over the past 12 months, even as the demand for cloud capabilities accelerates.
Charlie Li, President and Global Head of Cloud and Security at NTT DATA, Inc., framed the issue in stark terms.
“AI is accelerating faster than enterprise cloud maturity,” Li explained. “Cloud has moved well beyond infrastructure and is now the execution layer for AI. Organisations that fail to evolve their cloud foundations risk constraining the growth and value of their AI investments.”
He added that clients succeeding in this space are treating cloud as a value creator rather than a technology initiative.
The maturity gap
The report breaks cloud maturity into four levels: cloud-novice, cloud-enabled, cloud-mature and cloud-evolved. The largest group of organisations, at 34 per cent, sit in the cloud-mature category. A further 28 per cent are cloud-enabled and 24 per cent are cloud-novice. Only 14 per cent have reached the cloud-evolved stage, where cloud-native services are embedded in core business strategies.
This maturity gap helps explain why many organisations struggle to translate cloud adoption into sustained business value. Fewer than half of respondents reported being fully satisfied with cloud’s role in driving innovation (49 per cent) or with their overall IT modernisation progress (44 per cent).
Cloud leaders pulling ahead
The report identifies a subset of “cloud leaders” – organisations that are cloud-evolved and have achieved operating profit growth of more than 10 per cent in the past year alongside revenue increases. These organisations are nearly 2.5 times more likely than others to deliver revenue growth exceeding 10 per cent and more than twice as likely to operate at margins of 15 per cent or higher.
Cloud leaders report less budget pressure, with 55 per cent describing their cloud funding as more than sufficient, compared with 34 per cent of all other organisations. They are also more focused on AI readiness as a cloud priority: 48 per cent want their cloud capabilities to enable greater AI readiness over the next 12 to 18 months, compared with 34 per cent of others.
The gap extends to confidence in agentic AI, with 53 per cent of cloud leaders viewing it as a complete game changer for cloud, compared with just 30 per cent of all other organisations.
Legacy systems holding back innovation
Half of all organisations surveyed reported that the need to modernise applications and data platforms is holding them back from cloud-related innovation. Cloud modernisation will remain the top cloud priority for the next two years, ahead of migration, optimisation and managed services.
The report argues there is no realistic path to AI-driven value without cloud modernisation. Organisations still restricted by legacy environments built on applications not designed for the cloud face limits on scale and speed.
Data readiness is also a significant barrier. Challenges around data readiness and analytics are the number-one reason organisations report dissatisfaction with their efforts to build cloud-native AI applications. Some 36 per cent of organisations say agentic AI has intensified the need for clean, well-governed and AI-first data models and architectures.
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Six rules for cloud value
NTT DATA outlines six imperatives for organisations looking to turn cloud into a strategic value engine in the AI era.
The first is that cloud and AI strategies need to be developed together. The report notes that organisations cite a shortage of AI skills as their single largest cloud-related skills gap, with cloud leaders feeling this more acutely – 49 per cent expect it to remain a challenge over the next 12 months, compared with 33 per cent of others.
Chief AI Officers are 22 per cent more likely than CIOs and CTOs to feel strongly that the rise of agentic AI has increased the need for cloud investment, exposing a growing tension between AI ambitions and the technology foundations needed to support them.
Architecture decisions matter more than ever
The second imperative focuses on cloud architecture choices. Nearly all organisations (99 per cent) expect private cloud adoption to increase, driven by concerns about sovereignty, data ownership, cost and data security. Sovereign cloud adoption is projected to rise 50 per cent in the next two years, from 28 per cent of organisations to 42 per cent.
These models are not replacing public cloud but are being layered alongside it, creating more complex hybrid and multicloud architectures. Organisations rank integration with existing multicloud and hybrid cloud strategies as their number-one concern about sovereign cloud adoption.
Platform-led approaches gaining traction
The report’s fourth rule highlights a sharp shift toward fully managed cloud platforms. Organisations expect their use of fully managed and automated cloud platforms to triple over the next 12 to 18 months, from 11 per cent to 32 per cent.
More than half of organisations surveyed (57 per cent) identify cloud cost management as a challenge, a problem that intensifies as AI workloads drive higher and more unpredictable infrastructure usage.
Nearly half of all organisations (49 per cent) now execute site reliability engineering (SRE) practices entirely through a service provider, with just over one in 10 handling SRE fully in-house.
Security the top investment priority
Security has become the number-one cloud investment priority, according to the research. Organisations cite security, governance, risk and compliance concerns regarding autonomous agents as the top challenge to adopting agentic AI in cloud-based solutions over the next 12 to 18 months.
Confidence in cloud security diverges sharply between leaders and others. Among cloud leaders, 68 per cent report strong confidence in their cloud security posture, compared with 36 per cent of all other organisations. Cloud leaders are also far more likely to define clear security roles and responsibilities backed by regular audits – 54 per cent versus 34 per cent.
Only 27 per cent of cloud leaders rely primarily on a cloud provider’s native security controls, compared with 44 per cent of other organisations, with 50 per cent of all organisations now using a mix of native and third-party security tools.
Measuring what matters
The report also calls for organisations to reset how they measure cloud transformation success. Traditional KPIs such as the number of applications migrated or infrastructure cost savings track activity rather than business value and are assessed too late to guide decisions.
AI adoption in cloud migration projects remains uneven: 47 per cent of cloud leaders used AI in their last cloud migration project, compared with 35 per cent of all other organisations. Meanwhile, 62 per cent of all organisations expect the impact and ROI of agentic AI for cloud-native application modernisation to fall short of expectations.
Industry cloud gaining ground
Nearly two in three organisations (64 per cent) say industry cloud solutions will be extremely important to their cloud strategy, with cloud leaders far more likely than others to adopt them – 82 per cent compared with 63 per cent.
About one in three organisations (34 per cent) are already building centralised, cloud-native platforms to manage growing AI demand, though 39 per cent express concern about moving agentic AI from pilot phase to production.
About the research
The survey was conducted via online questionnaire in September and October 2025 by STRAT7 Jigsaw on behalf of NTT DATA. Respondents included C-suite executives (73 per cent), vice presidents and directors (21 per cent) and senior managers (6 per cent) across 13 industries. The dataset is presented at a 99 per cent confidence level with a 3 per cent margin of error.
Last Updated on April 8, 2026 by Nick Ross
