AI workloads are increasing wasted cloud spend for the first time in 5 years but AI governance teams might be a solution

Date:
Fri, 20 Mar 2026 15:00:00 +0000

Description:
AI and cloud spend are up, but companies might not be expanding as
efficiently as they could be, leading to wasted resources.

FULL STORY ======================================================================Copy link Facebook X Whatsapp Reddit Pinterest Flipboard Threads Email Share this article 0 Join the conversation Follow us Add us as a preferred source on Google Newsletter Tech Radar Get the TechRadar Newsletter Sign up for
breaking news, reviews, opinion, top tech deals, and more. Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners or sponsors By submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over. You are
now subscribed Your newsletter sign-up was successful An account already exists for this email address, please log in. Subscribe to our newsletter AI adoption continues to rise, and companies are expanding cloud to adapt Cloud waste has risen for the first time in five years Unified teams can be more focused, leading to less waste According to Flexera, 85% of businesses still see managing cloud spend as a top challenge, except artificial intelligence
is causing them to spend more than ever before on cloud services.

Four-fifths (81%) now use AI, up from 47% in 2024, and it's driving waste at the same time. In fact, cloud waste has risen to 29%, marking the first increase in five years, and Flexera's blaming it on AI. Cloud waste can be caused by any number of factors, including unused VMs and databases, extra computer, storage or memory, old backups and more. Article continues below
You may like Tech leaders need a cloud reality check before its too late Businesses are struggling to achieve AI success - this report reveals why IT spending set to hit $1.4 trillion in 2026 - but what exactly are we spending it on? AI and cloud bills are rising At this point, three-quarters (76%) of large enterprises are now spending upwards of $5 million in cloud every
month, while 73% are operating multicloud environments whereby they're paying for cloud and the hardware that goes into fueling their on-prem environments.

"Weve moved beyond treating the cloud as a cost-cutting exercise and now see it as the essential foundation for growth and the engine that allows us to turn ideas into global products," CTO Brian Shannon wrote.

The report's data also quantifies the dominance of US hyperscalers, with AWS (83%) and Azure (79%) leading way ahead of Google Cloud, which itself is
steps ahead of others.

Things could be about to change for the better, though, with 71% now
operating a Cloud Center of Excellence (CCOE) increasing collaboration
between FinOps, business units and software assessment management (SAM)
teams. Are you a pro? Subscribe to our newsletter Sign up to the TechRadar
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With a CCOE in motion, companies can benefit from central governance, consistent standards and better cost control, therefore leading to a more unified approach to AI and cloud driving down costs and eliminating waste. Follow TechRadar on Google News and add us as a preferred source to get our expert news, reviews, and opinion in your feeds. Make sure to click the
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