Investments in AI and Digital Asset Surge While Data and Legacy Tech Challenges Persist, Broadridge Digital Transformation Study Finds
Rhea-AI Summary
Broadridge Financial Solutions (NYSE: BR) has released its fifth annual Digital Transformation & Next-Gen Technology Study, revealing significant trends in financial services technology adoption. 80% of firms are making moderate-to-large investments in AI this year, with 72% specifically investing in GenAI, up from 40% in 2024.
The study highlights that 41% of executives feel their technology strategy isn't moving fast enough, while 46% believe legacy tech is hampering resiliency. Firms plan to allocate 29% of their total IT spend to technology innovation over the next two years, a seven percentage point increase from last year.
Key findings include:
- 71% of firms are making major investments in blockchain and DLT, up from 59% in 2024
- 64% are making significant cryptocurrency investments, up from 51% in 2024
- 86% of firms are integrating cloud technology
- 58% identify data harmonization as important for maximizing ROI
- 40% admit to having data quality issues
Positive
- Significant increase in GenAI investments from 40% to 72% YoY
- Strong growth in blockchain/DLT investments from 59% to 71% YoY
- Cryptocurrency investments up from 51% to 64% YoY
- 29% of IT budget allocated to innovation, up 7 percentage points
- 86% cloud adoption rate with 84% making substantial investments
Negative
- 40% of firms report data quality issues
- 46% indicate legacy technology hurting operational resiliency
- 41% of executives admit technology strategy moving too slowly
- 58% struggle with data harmonization affecting ROI
News Market Reaction – BR
In the trading session that priced this news, BR declined 2.57%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
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- Data harmonization is key when it comes to implementing AI and digital assets with
80% of firms making moderate-to-large investments in AI this year;50% of executives believe there will be a significant adoption of digital assets and ledger technology within the capital markets over the next several years. - While
58% of financial services technology and operations executives agree a clear data strategy leads to the maximum rate of return on technology investments,40% admit to having data quality issues. - Almost half (
41% ) of executives feel their technology strategy is not moving fast enough at its current trajectory and46% feel legacy tech is hurting resiliency. - Overall, firms expect to allocate
29% of their total IT spend to technology innovation over the next two years, an increase of seven percentage points from last year's study.
"As financial services firms modernize their operations and move away from legacy systems, many are realizing that the right data management strategy has the power to break down silos and achieve the level of data quality needed to realize the potential of AI and sustain prolonged digital transformation within their organizations," said Chris Perry, President of Broadridge. "With the right data strategy and a clear plan to address legacy tech, firms can drive digital transformation, enable innovation at scale, enhance customer experiences, and foster long-term growth while providing operational resilience and efficiency."
Over half (
Promise of GenAI Gains Too Hard to Ignore
The results of this year's study show an evolution in the way financial services firms are extracting value from GenAI. Key findings include:
72% are making moderate to large investments in GenAI this year, up from40% in 2024.- More than two-thirds (
68% ) believe that GenAI will have the greatest impact on employee productivity and35% expect to start seeing ROI from GenAI within six months. 67% noted that they personally use GenAI most for investment or market research.
Digital Assets Go Mainstream
After many years of sitting on the sidelines, digital assets have also captured the focus of financial services executives. Key findings include:
- Nearly three-quarters (
71% ) of firms are making major investments in blockchain and distributed ledger technologies (DLT) this year, up from59% in 2024. 64% are making big investments in cryptocurrency, up from51% in 2024.- Almost half (
47% ) believe DLT is enabling the development of new opportunities in the capital markets ecosystem. 73% agree that there will be greater regulation and governance around digital assets moving forward.
Cloud Continues as the Backbone of Scalability, Operational Efficiency and Agility
When it comes to the technology being adopted most widely today, cloud is king, with
When asked which technology executives believe has the greatest impact on their business, the majority (
"It's really all about straight-through processes and the ability to see consistent data across all products and workflows," said Jason Birmingham, Broadridge global head of engineering. "Firms that are still trying to drive transformation by bolting on point solutions are quickly starting to realize that there is a limit to how much they can accomplish before they address the fundamental flaws in their platforms."
The fifth annual Broadridge Digital Transformation & Next-Gen Technology Study breaks down the sentiment, reflections and actions of more than 500 financial services technology and operations leaders from around the world and across wealth management, capital markets and asset management firms. The study demystifies what's guiding each organization's transformation roadmap and explores their unique approaches to data, AI, crypto, cybersecurity, personalization and more.
Methodology
Broadridge commissioned Phronesis Partners to conduct this survey. This survey, as part of Broadridge's annual series, was conducted in a fashion consistent with previous years. The survey was taken by over 500 financial services technology and operations leaders from around the world and across wealth management, capital markets, and asset management firms.
About Broadridge
Broadridge Financial Solutions (NYSE: BR) is a global technology leader with the trusted expertise and transformative technology to help clients and the financial services industry operate, innovate, and grow. We power investing, governance, and communications for our clients – driving operational resiliency, elevating business performance, and transforming investor experiences.
Our technology and operations platforms process and generate over 7 billion communications per year and underpin the daily trading of more than
For more information about us, please visit www.broadridge.com.
Broadridge Contacts:
Investors:
Edings Thibault
Head of Investor Relations, Broadridge
broadridgeir@broadridge.com
Media:
Gregg Rosenberg
Global Head of Corporate Communications
Gregg.Rosenberg@broadridge.com
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SOURCE Broadridge Financial Solutions, Inc.