Hooray! IT Spending Cranks Up

This is the trend we’ve been all waiting for – IT spending is bouncing back, as businesses invest more in new network equipment, desktops, software, cell phones and other technology. I read about this yesterday in The Wall Street Journal, as it reported on Cisco Systems Inc.’s 23% hike in fiscal second-quarter 2010 profits and an 8% jump in revenue.

In the Journal article, Cisco’s CEO John Chambers said that he planned to hire up to 3,000 workers this year, adding: “This is one of the most robust positive turnarounds I’ve seen in my career.”

Cisco’s news comes after the Commerce Department recently reported that business spending on equipment and software climbed 13.3% annually in the fourth quarter – the fastest growth since the first part of 2006.

A lot of the comeback in tech spending is from consumers, buying laptops and cell phones. But businesses are laying money down again, too. For example, Intel Corp. in January reported that revenue for its business that sells chips for corporate servers rose 42%, and Sybase Corp., which makes database software for financial services firms, had a 34% jump in profits for the December-ended period.

Cisco, whose fiscal second quarter ended in late January, said its profit was $1.85 billion, up from $1.5 billion a year earlier.

Could Cisco’s results be a grand harbinger of things to come and a spurt of much-needed hope since 2008? I hope so. Aside from the big tech outfits like Cisco, I’m personally seeing more and more demand from small and mid-size companies deciding to invest in new IT technology and services, such as cloud monitoring. What a year we had in 2009!

What do you think? Is the IT sector finally beginning to recover?