Kyndryl’s 2025 Readiness Report Shows AI Progress Amid Foundational Challenges

Kyndryl’s second annual Readiness Report reveals that while businesses are gaining returns from AI investments, many still struggle with infrastructure, skills, and regulation. The report, based on insights from 3,700 senior leaders across 21 countries, highlights how enterprises are at a tipping point between experimentation and large-scale transformation.

Kyndryl, a leading global provider of mission-critical enterprise services, has released its 2025 Readiness Report, showing businesses reporting increased returns on AI investments, yet facing mounting barriers in technology, workforce capability, and regulatory compliance.

The report underscores the current paradox: organisations feel confident about their innovation potential but are constrained by ageing infrastructure and workforce readiness. 

Martin Schroeter, Kyndryl’s Chairman and CEO, captures this tension: “A readiness gap exists as enterprises grapple with the promise of transformative value from AI. While 90% of organisations think they have the tools and processes to scale innovation, more than half are stalled by their tech stack, and less than a third say their employees are truly ready for AI. Closing that gap is the challenge and opportunity ahead.”

AI adoption and ROI on the rise

The study shows a 12-point increase in positive returns from AI investments compared to 2024, with 54% of organisations now seeing measurable ROI. Despite this improvement, 62% of enterprises remain stuck in the pilot phase, unable to scale projects into full deployment.

Business leaders are also increasing investment, with AI spending up 33% year-on-year and 68% reporting heavy investment in at least one AI form. Cybersecurity emerges as the top AI use case as companies focus on safeguarding new value streams.

Infrastructure and cloud under strain

Technological readiness remains a limiting factor. While 90% of respondents believe their tools support rapid testing and scaling, over half admit that outdated systems still block innovation. 

Additionally, 75% of leaders express concern about geopolitical and regulatory risks linked to global cloud storage. Nearly two-thirds (65%) are adapting by reassessing vendors, repatriating data, or moving toward private cloud solutions. A striking 70% of CEOs acknowledge their current cloud setup was reached “by accident rather than design.”

Workforce readiness and cultural barriers

The report highlights that while 87% expect AI to completely transform jobs within a year, only 29% feel their workforce is ready. Many employees lack frequent exposure to AI tools or the technical expertise needed.

Cultural hurdles are also impeding innovation: 48% of CEOs say their organisations stifle creativity, while 45% admit decision-making is too slow. Kyndryl identifies “Pacesetters”, organisations outperforming peers by focusing equally on culture, leadership alignment, and upskilling. Pacesetters are 32 points less likely to face tech-stack limitations, 30 points more adaptable to regulatory changes, and 20 points less likely to suffer cyber-related outages.

About Kyndryl

Kyndryl (NYSE: KD) is a leading global provider of mission-critical information technology services, specialising in the design, construction, management, and modernisation of complex IT systems that power businesses worldwide. Operating in more than 60 countries, Kyndryl serves thousands of enterprise customers across industries including finance, healthcare, manufacturing, telecommunications, and government. 

The company offers advisory, implementation, and managed service capabilities through platforms such as Kyndryl Bridge, an AI-powered open integration solution that helps organisations optimise performance, enhance resilience, and accelerate digital transformation. As the world’s largest IT infrastructure services provider, Kyndryl plays a central role in enabling businesses to operate securely, efficiently, and sustainably in an increasingly digital economy.