ETOBICOKE, Ontario--(BUSINESS WIRE)-- CDW Canada, a leading provider of end-to-end technology solutions for Canadian organizations, today released its 2026 State of Digital Infrastructure and AI in Canada Report, with research insights by IDC, exploring how Canadian organizations are managing hybrid infrastructure and AI solutions while navigating the shift to digital sovereignty. The study, conducted and analyzed independently by IDC Canada, surveyed 700 senior business leaders at small, medium-sized and large organizations across industries and provinces in Canada.
The report found that Canadian organizations are entering a new phase of AI maturity, where success will be determined less by access to technology and more by the ability to operationalize it. That shift is reshaping cloud priorities as organizations modernize applications, strengthen data foundations and adopt flexible hybrid infrastructure to support AI while maintaining greater control over where data lives and how it is used.
AI value realization is accelerating cloud modernization
AI adoption is already well established among Canadian organizations, with 77 percent using copilots or conversational AI, 60 percent using generative AI and 31 percent testing agentic AI. Most organizations are also choosing to buy or customize rather than build from scratch, with 85 percent purchasing or adapting AI solutions instead of developing their own models.
As adoption matures, organizations are turning their attention to realizing value from these investments and are creating the environments needed to run AI at scale. That is putting greater pressure on the technology and data foundations that support AI. Nearly two-thirds (64 percent) say AI has led them to modernize applications and infrastructure in the cloud, while 59 percent say it has accelerated cloud adoption. Scalability is the top data architecture improvement required to support AI, cited by 63 percent of respondents.
“Success with AI is no longer about access to the technology. It’s about an organization’s ability to operationalize it and turn it into meaningful business value,” said KJ Burke, Field Chief Technology Officer, Hybrid Cloud, CDW Canada. “As organizations move from experimentation to scale, they need to modernize applications, data and infrastructure to create an environment where AI can operate securely and effectively across their digital estate. The opportunity is to build a digital foundation that delivers value from AI today while retaining the flexibility to evolve as the technology advances.”
Hybrid cloud becomes the foundation for AI at scale
As organizations modernize their cloud environments, hybrid cloud is emerging as the preferred operating model. Nearly two-in-three (63 percent) Canadian organizations prefer a hybrid approach, giving them the flexibility to place AI and other business-critical workloads where performance, cost, security and compliance requirements best align.
The appeal of hybrid cloud is particularly strong among medium-sized and small organizations, where simplicity and cost control can outweigh the benefits of operating across multiple public cloud providers. Large organizations are more likely to use multicloud environments to access differentiated capabilities, while smaller organizations often use hybrid strategies to keep predictable workloads in lower-cost environments. For mid-sized organizations in particular, a manageable hybrid environment can provide the flexibility to support new AI workloads without introducing unnecessary cost and complexity.
Managing multiple environments is the next challenge for Canadian organizations. Real-time management and monitoring (63 percent), AI and GenAI automation (51 percent) and cloud orchestration (36 percent) are the top areas for increased investment. While hybrid can offer a simpler path than multicloud for smaller organizations, operational complexity remains a challenge. Smaller organizations are more inclined to manage each cloud environment using its native tools rather than a unified management layer. While simpler to implement initially, this approach can fragment visibility and operations across the cloud estate, with downstream implications for automation maturity.
The operational challenge extends to resilience and security. Over half (57 percent) of organizations now describe their infrastructure as sufficiently or exceptionally resilient, up from 48 percent in 2024. Cybersecurity remains the top concern (62 percent) and the leading priority for futureproofing (69 percent).
Trusted data is critical to AI value
As organizations put AI to work across more of the business, the quality, security and accessibility of their data become increasingly important. More than half of organizations have standardized data management on cloud or dedicated platforms, particularly for integration, governance and privacy.
However, significant gaps remain. More than half (55 percent) say their data management capabilities need improvement, with data security (56 percent) and data fragmentation (54 percent) cited as the leading challenges. Looking ahead, organizations are prioritizing data privacy (49 percent), security (48 percent) and quality (35 percent).
Modern cloud strategies balance scale and sovereignty
Canadian organizations increasingly view digital sovereignty as a matter of governance, trust and business resilience. Nearly three quarters (72 percent) are already on the path to sovereign cloud adoption. More than one quarter have moved beyond the planning stage, with 10 percent using sovereign cloud extensively and 16 percent deploying it for select workloads. The remainder are either piloting sovereign cloud solutions or have plans for implementation within the next 12 months.
Evolving privacy regulations and growing expectations around data governance are driving the change. Quebec's Law 25 has set a higher bar for how organizations manage and transfer personal information. At the same time, a growing range of Canadian cloud offerings are giving organizations real options. Among large organizations, 27 percent already use Canadian cloud providers and another 24 percent plan to make the shift within the year.
Rather than applying one standard, Canadian organizations are matching the level of protection to each workload. Most prefer to stay on major global cloud platforms and add their own sovereign controls, such as keeping data in Canada, holding their own encryption keys and setting clear policies on who can access their data and under what conditions. Of respondents, 34 percent have already taken this approach, which keeps the scale and features of global providers.
“As AI scales, sovereignty becomes an important part of the value equation,” said Burke. “Organizations need access to the innovation and scale of the cloud, but they also need confidence in where their data resides, how it is protected and who controls it. The organizations that get this balance right will be better positioned to operationalize AI securely, responsibly and realize business value.”
As AI moves from early adoption toward enterprise-wide deployment, the measure of success will increasingly shift from how much AI organizations adopt to the value they generate from it. Canadian organizations that combine trusted data, strong governance and flexible hybrid infrastructure will be best positioned to turn AI investment into measurable business outcomes. To read the full report, visit http://www.cdw.ca/cloudreport.
About CDW Canada
CDW Canada Corp. is the strategic end-to-end technology partner that cuts through complexity to turn customer ambition into outcomes. Working with organizations across the business, government, education and healthcare sectors, CDW enables organizations to navigate an increasingly complex technology market and turn their technology investments into lasting value. CDW Canada is a wholly owned subsidiary of CDW Corporation (Nasdaq: CDW), a global organization. For more information, visit www.CDW.ca.
