Enterprise AI Spending Hits $7.3B; VCs Predict 2026 as Breakout Year

According to Menlo Ventures' "State of Generative AI in the Enterprise" report, departmental AI spending hit $7.3 billion in 2025 — up 4.1x year over year. Coding tools dominate at $4 billion (55% of spend).

Vertical AI became a $3.5 billion category, tripling from the prior year. Despite this growth, only 8.6% of companies have AI agents deployed in production, 63.7% report no formalized AI initiative, and 46% of tech leaders cite AI skill gaps as a major barrier.