Goldman Survey Paints Bleak IT Spending Picture

After showing signs of stabilizing last autumn, the spending plans of information technology managers have taken a "nasty turn for the worse," a Goldman Sachs survey found.

Respondents to the Goldman poll now see 2003 IT spending falling 1% instead of the 2%-3% average gain they previously saw. As a result, Goldman argued that current multiples among technology companies remain "lofty" on a relative basis, particularly with no obvious buying catalysts on the horizon.

Two-thirds of the managers surveyed think reduced IT spending is more likely, while 56% expect discounting to rise and 15% expect spending to pick up in the second half of 2003, the survey found.