Hungarian-owned IT companies largely delivered double-digit median revenue growth in 2025, despite a weaker macroeconomic backdrop. Artificial intelligence and cloud migration are driving structural change across IT consulting, custom software development and product (own-software/SaaS) businesses. This analysis reviews financial trends, cost dynamics and M&A activity in those three segments.
Macroeconomic context
In 2025 Hungary’s GDP grew by only 0.5%, while the IT segment expanded by 1.3%. In the first half of 2026 the overall economy grew 1.7%, yet the IT sector recorded only 0.2% growth according to the Hungarian Central Statistical Office (KSH). Salary growth in many IT roles moderated in 2026 (Bluebird 2026 IT Salary Guide), but personnel costs rose faster than revenues for the companies we examined in 2025.
Methodology and scope
We focus on Hungarian-owned companies in three areas: (i) IT consulting (cloud, system integration, ERP implementations, analytics), (ii) custom software development (client-specified projects), and (iii) own software/products (licensed or subscription/SaaS). State- or foreign-owned firms, non-IT core players and companies with large hardware wholesale exposure were excluded. Classification relied on public financials and industry knowledge.
IT consulting: stable segment under cost pressure
The TOP20 IT consulting companies posted a median revenue growth of 10.7% in 2025. Median EBITDA margin declined modestly to 13.4%, indicating slightly lower profitability but still a stable, double-digit margin profile. Personnel costs rose faster than revenues — median personnel expenses increased by 20.6% among the TOP20. Material-type costs are highest in this segment (about 64% of revenue), largely due to resold software.
Growth drivers in IT consulting were cloud services, cybersecurity and AI-integration work. Major platforms such as SAP and Atlassian continue to migrate customers from on-premise to cloud models, generating sustained advisory and migration demand. AI-driven automation and agent-based solutions also create differentiation opportunities for vendors that can integrate AI into industry-specific offerings rather than as standalone technology.
Custom software development: strong rebound and improving returns
The custom development TOP20 recorded the strongest growth: median revenue growth rose to 16.8% in 2025 (from 10.4% in 2024). Median EBITDA margin improved from 13% to 15.2%, suggesting better utilisation of previously underused capacity and more efficient delivery.
Geographic exposure remains largely domestic for most players; exceptions include Gloster Csoport and Sysdata PSE, where exports account for over 50% of revenues. AI’s impact on this segment is complex: it can significantly boost productivity (same tasks completed faster, with fewer people), yet it can also put downward pressure on prices and lower entry barriers, intensifying competition. Consequently, billing models may shift from time-and-materials to outcome-based pricing and greater emphasis on high-value, domain-specific expertise.
Own software (product/SaaS): slower growth but still highest margins
The product software segment showed a slowdown in growth: median revenue growth fell from nearly 16% to 11.4% in 2025. Nevertheless, it remains the most profitable of the three segments — median EBITDA margin declined from around 25% to 19% but still exceeds margins of consulting and custom development. Material costs rose by 8% and personnel costs by 16%.
From an M&A perspective, the “Rule of 40” is informative: 11 of the TOP20 met the Rule of 40 in 2024, while 9 did so in 2025. The sample contains both fast-growing but less profitable companies and mature, margin-rich but slower-growing firms.
AI affects product businesses not only through development efficiency but also by potentially making certain functions or entire product modules more easily replicable. This increases the value of vertical domain knowledge, embedded customer relationships, proprietary data and high switching costs — all elements that support valuation and defensibility.
Transaction landscape: international buyers and premium on specialization
There were several Hungary-related M&A deals across the three segments; four notable transactions included three with international buyers. The strategic rationales differ but share common themes: the importance of specialized domain knowledge, entrenched customer relationships, proprietary technology/IP and exportable business models.
Examples highlighted in the market:
- Bechtle – EuroSolid: Bechtle acquired a PLM-capable local player to extend PLM activity across nine European countries and leverage international synergies.
- Vesta – SK Trend: Vesta added a vertical software company aligned with a long-term, ‘hold-forever’ strategy focused on industry specificity and a buildable customer base.
- Hawk Infinity – Dorsum: the acquisition emphasised international growth potential and the value of domain expertise.
- Attrecto – Bobcats Coding: the buyer integrated AI-focused development competence and a team experienced with US startups to support its growth strategy.
These deals illustrate that international buyers prize more than developer capacity: they seek hard-to-replicate value such as industry specialization, proprietary tech/IP, stable client relationships and export potential.
Conclusions and outlook
Based on 2025 data, the examined Hungarian IT segments showed resilience despite a weaker macro backdrop: all three TOP20 medians registered double-digit revenue growth. However, growth quality and profitability diverge by segment. Custom development delivered the strongest growth and improving returns, consulting remained stable but faces cost pressures, and product software maintained the highest margins while growth slowed.
AI is both an enabler and a disruptor across segments: it can boost operational efficiency and create new services, but it can also compress prices, alter monetisation models and change valuation metrics. As a result, performance will increasingly depend on how well companies integrate AI into their operations and product offerings and on their ability to offer defensible, non-replicable value (domain expertise, client embedding, proprietary data/technology, export readiness).
On the M&A front, international interest in Hungarian IT remains, but buyers are becoming more selective. Firms that combine technological adaptability with well-defined, defensible market positions and scalable, exportable business models are expected to fare best in future consolidation and investment activity.
Related event
The business implications of AI and digital transformation will be discussed at the Portfolio AI & Digital Transformation conference to be held on November 26 (details and registration available from Portfolio).
