• Data shows organizations are deploying AI in workflows beyond pilots, with 64% seeing returns on AI investments, up 10 points from 2025
• As AI moves deeper into the business, leaders also report their average readiness for external risks fell to 24% — down 7 points from 2025 — a decline evident across industries and countries
• 71% of leaders say their IT estate is mostly or fully modernized, yet 66% of CIOs believe their infrastructure requires significant re-architecture before it can support AI at scale

NEW YORK, Nov. 10, 2026 /PRNewswire/ — Kyndryl (NYSE: KD), a leading provider of mission-critical enterprise technology services, today released the findings from its third annual Readiness Report, revealing a widening divide between the returns organizations are seeing from AI and their readiness to manage the risks and demands that come with it.

While 64% of leaders report positive returns on AI investments, up 10 points from 2025, average readiness across external risks fell seven points to 24%. The steepest declines were in readiness for cyber threats and competitive disruption, as AI puts new pressure on business models, technology foundations and how organizations operate.

This year’s report captures the attitudes and actions of 3,700 senior business leaders across 21 countries. The data shows a dichotomy: while organizations are racing to deliver returns on significant AI investments, they simultaneously feel ill-equipped to navigate the implications for the AI era.

“As AI creates significant opportunity, organizations are now focusing on how to make early returns sustainable,” said Martin Schroeter, Chairman and CEO, Kyndryl. “This year’s Readiness Report shows a new kind of readiness gap: AI ambitions are moving faster than the systems needed to support them, and the bar for readiness keeps moving as AI becomes more integrated in enterprises. Our data shows that focusing on people, technology and governance can help organizations win with AI and keep the ability to adapt as opportunities evolve.”

The report shows how organizations are making progress and adapting their AI strategies:

• Significantly fewer describe themselves as in the experimentation phase compared to a year ago (-13 points from 2025, to 49%)
• Nearly half (48%) substantially changed their AI strategies this year, with implications across tech, people and governance
• About a quarter (24%) saw an AI investment fail, and 21% canceled a major AI initiative

The transition from experimentation to broader, sustained adoption remains uneven, particularly in the workforce and talent. Organizations have further to go in adapting how people work:

• Just 27% have formally updated roles and responsibilities around AI
• 29% have fully implemented change management for AI adoption at their organizations
• Those who have done both are 28 points more likely to be completely ready for their AI implementation, and are 8 points more likely to report positive ROI on their AI investments

Additional findings in the report include:

Security concerns drive down confidence
For the third year in a row, security concerns topped the list of external risks, and this year contributed most to the overall decline in readiness. Just 26% of firms said they were completely ready for cyberattacks, a drop of 11 points from last year. Three in four leaders say AI helps their organizations identify threats faster, even as confidence in their ability to respond to cyberattacks has declined.

Concern about AI challenges established business models
The second-largest drop in readiness came from leaders’ concerns about competitive disruptions outside of their industry (-10 points from 2025, to 23%). The finding comes as AI agents and other new technologies are being deployed to erode established industry boundaries, and leaders described both challenges of adopting new technologies and questioning established products and business models.

Retailers, for instance, are weighing how to benefit from AI shopping assistants without forfeiting direct customer relationships; software companies face questions about SaaS models as AI rebalances the build-versus-buy equation; and financial institutions are challenged by emerging lending models.

Leaders put a premium on sovereignty, but action remains limited
The research also captures how leaders are considering digital sovereignty in a year marked by greater actions by governments, most visibly in the European Union. Notably, leaders in the EU are slightly less likely to have taken sovereignty-related actions compared to those in the rest of the world. It also captures the trade-offs organizations may need to make: 68% say solutions offering full operational control, should they need it, are worth a premium of 10% or more, and 60% say greater control is worth slower deployment and adoption of advanced capabilities.

Modernized infrastructure isn’t necessarily AI-ready
For the third year in a row, leaders said upgrading their IT infrastructure was the number one action their organizations are taking to mitigate external risks, and 71% rate their infrastructure as mostly or fully modernized. Yet two-thirds of CIOs surveyed think their technology foundations need significant re-architecture before being fully ready for AI at scale. Leaders are also making a distinction between a modern IT estate and one ready for the increased demands of artificial intelligence.

Read the Kyndryl Readiness Report.

About Kyndryl
Kyndryl (NYSE: KD) is a leading provider of mission-critical enterprise technology services, offering advisory, implementation and managed service capabilities to thousands of customers in more than 60 countries. As the world’s largest IT infrastructure services provider, the company designs, builds, manages and modernizes the complex information systems that the world depends on every day. For more information, visit www.kyndryl.com.

Kyndryl press contact
press@kyndryl.com

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SOURCE Kyndryl