According to a new report, published by KBV research, The Global Application Modernization Services Market size is expected to reach $62.61 billion by 2032, rising at a market growth of 16.3% CAGR during the forecast period.
Application modernization services refer to the structured set of professional services that help organizations update or transform legacy software applications into modern, cloud-ready, scalable systems that align with current business needs and digital strategies. These services emphasize infrastructure modernization, architecture transformation, and enhanced customer and developer experiences—without necessarily rewriting software from scratch.
The Large Enterprise segment captured the maximum revenue in the Global Application Modernization Services Market by Enterprise Size in 2024, thereby, achieving a market value of $32.3 billion by 2032. Large enterprises represent a significant segment of the Application Modernization Services Market due to their extensive portfolios of legacy applications, complex IT ecosystems, and mission-critical workloads. These organizations typically require deep modernization engagements that include application re-architecting, cloud migration, microservices enablement, and integration with enterprise-grade platforms such as ERP, CRM, and data analytics systems.
The Public Cloud segment is experiencing a CAGR of 15.6 % during the forecast period. The Public Cloud deployment segment in the Application Modernization Services Market is driven by organizations seeking scalability, flexibility, and rapid modernization of legacy applications. Enterprises adopting public cloud modernization focus on refactoring and re-platforming applications to leverage cloud-native services such as containers, serverless computing, and managed databases. This segment emphasizes faster innovation cycles, reduced infrastructure management, and improved accessibility across distributed environments.
The BFSI segment led the maximum revenue in the Global Application Modernization Services Market by Industry Vertical in 2024, thereby, achieving a market value of $14.0 billion by 2032. The BFSI segment drives strong demand for application modernization services due to its reliance on legacy core banking, payment, and risk management systems that must support high transaction volumes and real-time processing. Modernization initiatives in this segment focus on enhancing security architectures, improving system resilience, enabling digital banking platforms, and supporting advanced analytics. Deep integration with compliance frameworks, fraud detection tools, and customer engagement applications is essential.
The Cloud Application Migration segment is growing at a CAGR of 15.3 % during the forecast period. The Cloud Application Migration segment forms a core component of the Application Modernization Services Market, focusing on transitioning legacy applications to cloud environments to achieve scalability, flexibility, and operational efficiency. Modernization initiatives in this segment involve careful assessment of application dependencies, selection of appropriate cloud models, and execution of lift-and-shift, re-hosting, or re-architecting strategies.
The North America region dominated the Global Application Modernization Services Market by Region in 2024, and would continue to be a dominant market till 2032; thereby, achieving a market value of $23.4 billion by 2032. The Asia Pacific region is anticipated to grow at a CAGR of 16.9% during (2025 - 2032). Additionally, The Europe region would witness a CAGR of 15.9% during (2025 - 2032).
By Enterprise Size
By Deployment
By Industry Vertical
By Service Type
By Geography
Unique Offerings
