Global Mainframe Modernization Market

Mainframe Modernization Market Size Summary

The Global Mainframe Modernization Market Size Was Valued at USD 7.23 Billion in 2024 and is Projected to Reach USD 20.62 Billion by 2035, Growing at a CAGR of 10% from 2025 to 2035. The market for mainframe modernization is expanding as a result of businesses looking to update legacy systems for better performance, scalability, security, and compliance in a competitive environment. These demand factors include increased agility, lower operating costs, cloud integration, and digital transformation.

Key Regional and Segment-Wise Insights

• In 2024, North America held the greatest revenue share of 30.4% and led the worldwide mainframe modernization market.
• With the biggest revenue share of 63.6% in 2024, services segment dominated the market by component.
• The large enterprise segment held the largest revenue share and dominated the market based on organization size.

Global Market Forecast and Revenue Outlook

• 2024 Market Size: USD 7.23 Billion
• 2035 Projected Market Size: USD 20.62 Billion
• CAGR (2025-2035): 10%
• North America: Largest market in 2024
• Asia Pacific: Fastest growing market

The mainframe modernization market consists of services that include re-platforming, re-hosting, re-factoring, and cloud-native technology integration to update old mainframe systems for modern IT environments. Organisations from various industries adopt modernisation projects because they want to fix their outdated technology barriers, reduce their expenses, and enhance their business flexibility. The main drivers of this trend include the need for bigger systems, faster application deployment, better digital platform compatibility, and the shortage of mainframe-trained personnel. Businesses must update or replace their mainframe systems with modern solutions because they enable them to continue operations and improve customer experiences while delivering instantaneous data processing capabilities. Organisations need to maintain their competitive edge in markets which undergo rapid changes.

The market for mainframe modernization is expanding at a rapid pace due to technological improvements. The transition from legacy systems to cloud-based architectures occurs smoothly because of cloud computing, containerization, microservices, and APIs. Large cloud providers offer specialised mainframe modernization tools and services, which create a more straightforward and secure migration process. The implementation of AI with automation systems has made modernization procedures more efficient because these technologies help reduce errors and system downtimes. Through government programs that back digital transformation initiatives in public services, banking, and healthcare sectors, market growth occurs. These programs support the transition from old IT systems to modern, scalable, and secure solutions.

Component Insights

The services segment led the mainframe modernization market with the largest revenue share of 63.6% in 2024. The increasing need for professional help in handling complex modernization projects has established this sector as the dominant force. Organizations depend on service providers more than ever before to guarantee smooth mainframe transitions to modern IT systems through their consultation, system integration, migration, and maintenance services. The process of updating critical mission systems requires specialised services because it involves handling complex systems and high-risk situations that threaten both system downtime and data integrity. The increasing cloud adoption and digital transformation initiatives across various industries create a higher requirement for complete modernization services. This makes the services segment the main factor driving market revenue.

The software segment of the mainframe modernization market will experience a substantial CAGR through the forecast period because organizations seek advanced tools which enable them to migrate, integrate, and modernise their legacy systems more efficiently. Organisations require software solutions that support automation, code conversion, application refactoring, and system optimisation because they transition to cloud-native and hybrid environments. These tools help reduce manual effort, minimise errors, and accelerate modernization timelines while ensuring business continuity. The market growth receives an additional boost from AI- and ML-powered software systems, which provide real-time analytics and performance monitoring. Predictive maintenance capabilities. The market demands scalable, secure, adaptable software solutions which will keep this industry growing strongly throughout the next few years.

Organization Size Insights

The large enterprises segment held the largest revenue share and led the mainframe modernization market in 2024. The main reason for this dominance stems from large enterprises depending on legacy mainframe systems to operate their supply chain management, customer data, and financial transaction systems. Large businesses dedicate major funds toward modernization projects because they need to enhance their operational efficiency and scalability, and digital platform integration. These organisations possess the financial power, together with technical expertise, to handle complex organisational change initiatives. The industry receives support from modernization projects because organisations need to maintain regulatory compliance, protect cybersecurity, and deliver real-time services to their worldwide customer base.

Over the course of the forecast period, the mainframe modernization market's SMEs segment is anticipated to grow at a substantial rate. The expansion happened because small and medium-sized businesses now understand the benefits of modernising their outdated systems to achieve better scalability, agility, and cost efficiency. Organisations of all sizes need digital transformation to survive in their markets. This explains why they choose cloud-based and low-code modernization solutions that deliver adaptable solutions at lower costs and faster implementation. The expansion of managed services, along with affordable modernization tools, enables SMEs to handle their financial and resource constraints. SMEs establish modern IT infrastructure to protect their business operations while they meet new regulatory requirements because data security and compliance standards have become more demanding.

Regional Insights

North America led the mainframe modernization market by holding the largest revenue share of 30.4% in 2024. The region leads because it adopted new technology early while maintaining old infrastructure in big companies. This needs digital transformation. Major businesses in banking, financial services, insurance, and government sectors rely on mainframes extensively, so these industries actively fund modernization projects to enhance security, performance, and cloud platform integration. US and Canadian markets benefit from leading technology suppliers and service providers, which help drive market growth. Real-time data processing requirements, together with cybersecurity threats and regulatory demands, accelerate modernization efforts to preserve North America's mainframe modernization market leadership position.

Europe Mainframe Modernization Market Trends

The European mainframe modernization market will experience significant growth during the forecasted period because manufacturing, finance, insurance, and government sectors actively pursue digital transformation. The majority of European companies continue to operate with outdated mainframe technology so they need system updates to boost operational efficiency and achieve cost reductions and enhanced business flexibility. Modernization efforts are aided by the drive for cloud usage, regulatory compliance (like GDPR), and enhanced data security. The government operates programs to develop smart public services and digital infrastructure. These help speed up the process of moving away from outdated systems. The region will experience increasing demand for scalable, secure, modernization solutions because businesses need these solutions to stay competitive in their fast-moving digital market.

Asia Pacific Mainframe Modernization Market Trends

The Asia Pacific mainframe modernization market is expected to grow at the fastest CAGR during the forecasted period because of its fast digital transformation, expanding IT infrastructure, and rising cloud technology adoption. The four nations of China, India, Japan, and South Korea lead the way as they modernize their business systems to handle increasing requirements for scalable, agile, real-time data processing. The region's expanding manufacturing base, public sector, and BFSI industries drive this expansion. The growing number of SMEs allocates funds toward affordable modernization solutions because they need to stay competitive in the market. The Asia Pacific region leads mainframe modernization growth because governments back digital economic expansion and smart city development.

Key Mainframe Modernization Companies:

The following are the leading companies in the mainframe modernization market. These companies collectively hold the largest market share and dictate industry trends.

• IBM Corporation
• DXC Technology Company
• Infosys Limited
• Accenture
• TATA Consultancy Services Limited
• HCL Technologies Limited
• Wipro
• Amazon Web Services, Inc.
• Capgemini
• Open Text Corporation
• Others

Recent Developments

• In July 2025, Kyndryl Inc., a provider of IT infrastructure services, has launched advising and implementation services that use the agentic AI capabilities of Amazon Web Services, Inc. to assist businesses in modernizing or migrating mainframe programs more quickly, with less waiting time and risk. Through its consulting experience, Kyndryl Inc. streamlines the software development lifecycle to assist clients in modernizing mainframe programs on Amazon Web Services, Inc. Platform engineering is used to allow quick application deployment, provisioning, and integration.
• In April 2025, IBM introduced their z17 system, which was designed with the AI environment in mind. It combines accelerated AI infrastructure, including the Telum II processor, with a number of tools, including Watsonx Code Assistant for Z and Test Accelerator for Z, to allow generative AI in mainframe environments, increase developer productivity, and make modernization easier.

Market Segment

This study forecasts revenue at global, regional, and country levels from 2020 to 2035. Decision Advisors has segmented the mainframe modernization market based on the below-mentioned segments:  

Global Mainframe Modernization Market, By Component

• Software
• Services

Global Mainframe Modernization Market, By Organization Size

• Large Enterprises
• SMEs

Global Mainframe Modernization Market, By Regional Analysis

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • UAE
  • Saudi Arabia
  • Qatar
  • South Africa
  • Rest of the Middle East & Africa