Enterprises demand cloud value

The release of the Flexera 2026 State of the Cloud Report provides vital insights into how enterprises are navigating the constantly changing landscape of cloud computing and increasingly AI-driven workloads. The findings show that the enterprise cloud discussion has changed significantly in recent years.

What started as a focus on cost-cutting and simple lift-and-shift migration has evolved into a complex balancing act involving governance, innovation, and measurable business value. This shift is not only logical but also expected, especially considering the rise of AI and the shared experience of enterprises that have faced unexpected cloud costs and unchecked spending for years.

Let’s explore what the report shows, why these findings are expected given industry trends, and what enterprises can do to extract real value from their ongoing—indeed, increasing—cloud investments.

Moving beyond cost-cutting

The main finding from the 2026 State of the Cloud Report is that organizations are clearly moving past an era where “cost-cutting at all costs” was the primary cloud strategy. We see a notable 12% increase in organizations reporting value delivered to business units year over year, even as the emphasis on simple efficiency and savings has decreased by 6%.

This marks a turning point in cloud adoption maturity. For years, cloud evangelists and technology leaders highlighted the cost advantages of moving from on-premises systems to the public cloud, and rightly so. However, the initial enthusiasm faded for many CIOs and CFOs as complexities increased, such as cloud sprawl, unpredictable billing, or wasted resources. According to the report, about 29% of cloud spending is still wasted, a sobering figure for any CFO’s office, but this also marks an improvement compared to years of uncontrolled growth. Now, the focus is on making productive investments and how cloud services can significantly impact business results.

Wiser organizations are trying to understand the cost of each service, align spending with results, and develop the discipline to measure value at every level, from individual projects to large-scale digital transformation efforts.

Oversight and governance models

As cloud complexity increases, so does the need for controls and clear leadership. The State of the Cloud Report shows a growth in the adoption of cloud centers of excellence (CCOEs) and finops teams, with 71% of organizations now using CCOEs. More organizations have dedicated finops teams to advise, manage, and optimize cloud spend. Teams are also more active in overseeing SaaS and cloud software usage.

What unites these efforts is a shift toward centralized accountability. Enterprises have learned the hard way that finops, CCOEs, and asset management cannot function in isolation. Cloud cost management collapses when roles and responsibilities are scattered. The most developed organizations coordinate efforts across teams to maintain shared views on spending, usage, and business priorities.

Some enterprises may worry about adding bureaucracy, but establishing transparency and focus will balance innovation with risk management and connect cloud spending directly to organizational goals.

Opportunities and risks of AI

Perhaps the most important change in this year’s report is the rise in AI-driven workloads, especially the adoption of generative AI. The data is clear: 45% of organizations now use genAI extensively, up from 36% a year earlier. Companies see significant opportunities for innovation and gaining a competitive edge through AI. At the same time, they realize that AI workloads are flexible, can incur unpredictable costs, and are often billed under new consumption-based pricing models that can quickly escalate without strong governance.

While there’s excitement about AI’s potential, there’s also a rapidly growing consensus that strong governance and cost controls must be put in place before spending spirals far beyond projections. We’re starting to see organizations appoint dedicated AI governance leaders who can ensure that innovation is safe, scalable, and firmly tied to business value and operational accountability (unlike the early, chaotic days of cloud).

SaaS spending, too, has exploded, with the most common monthly range among respondents jumping to $200,000 to $500,000. This is a sharp increase from the $50,000 to $100,000-tier that dominated last year, driven largely by the proliferation of AI-powered features and complex, usage-based pricing models. The conclusion: Cloud bills won’t shrink anytime soon, but organizations are determined not to repeat past mistakes. The focus now is on ensuring every dollar has a tangible return.

Three ways to boost cloud value

If you’ve tracked cloud growth as long as I have, these shifts are both natural and expected. Ten years ago, cost savings were the main focus of every cloud business case. As companies moved beyond the initial adoption phase, issues like sprawl, waste, and sticker shock emerged. The rise of AI and its endless demand for compute and data have increased both the opportunities and risks. Enterprises are seeking a balanced approach that carefully considers innovation, costs, and business value.

Cloud cost management is evolving into a smarter, value-driven discipline that’s keeping pace with business priorities and fast-changing markets. Here are three recommendations for enterprises looking to increase value in their cloud services:

1. Double down on centralized governance. Build or strengthen your CCOE and finops capabilities, but don’t let these teams operate independently. Accountability and transparency must be shared and tied directly to business outcomes.
2. Bring AI governance into the fold early. Establish clear ownership, set measurable goals, and don’t hesitate to manage experimental projects with the same rigor as production workloads. AI innovation is too expensive and too important to leave to chance.
3. Treat finops as an ongoing discipline, not a one-time project. Invest in the people, processes, and tools that support continuous tracking, optimization, and reporting. Incorporate cost and value discussions into every cloud project’s life cycle.

The key message from this year’s report is simple: Enterprises are demanding clear value from their cloud and AI initiatives. That’s expected, and it’s exactly where mature organizations should be headed.