Ukrainian IT in early 2026: software has captured nearly 80% of the market, geography has stabili...

April 23 2026

Kharkiv IT Cluster has analyzed the state of the Ukrainian IT market as of the end of Q1 2026. The analysis was conducted within the framework of the EU-Ukraine Digital Sector Interlinkages Report — the first systematic study that mapped 14 critical technological dependencies of the EU, identified by the European Commission, against the real competencies of the Ukrainian IT market.

The report was prepared by a consortium of Ukrainian and European IT clusters within the ITBridge project. We cross-checked the data with YC.Market to look not only at overall trends, but also at the structure of companies and sole proprietors (FOPs). The market has become more concentrated, less fragmented, and significantly more predictable in its structure. Key changes are outlined below 👇

Software Development almost fully dominates the market

• The Software Development sector demonstrates strong growth: if at the beginning of 2025 it accounted for 72% of the market, today it is already nearly 80%.
• This is the core of the industry, where one registered company corresponds to 9 sole proprietors.
• The second-largest segment is Digital Marketing — its share has increased from 7% to 10%.
• The Hardware & System Integrators segment currently accounts for around 7% of the market.

What stands behind this growth?

The increase in the share of Software Development does not imply a decline in other areas such as Telecom or R&D — rather, it reflects a transformation of the market:

• a part of companies working on defense-related solutions formally remain classified under “Computer Programming” (including due to access to grants),
• software development scales faster than hardware production, which is more complex in terms of logistics and security.

Unmanned Vehicles, Robotics & Automation remains one of the critically important areas for the European Union, which Ukrainian expertise is fully capable of covering — just like 11 out of 14 of the most critical dependencies in the IT sector.

Market geography: where are talent and capital concentrated?

Big three — 50% of the market

• Kyiv — the main decision-making center
• Kharkiv region — remains a strong hub despite proximity to the frontline
• Lviv region — a key center in western Ukraine

Second tier — 30% of the market

• Dnipropetrovsk region
• Odesa region
• Kyiv region (excluding Kyiv city)
• Vinnytsia region
• Zaporizhzhia region
• Poltava region
• Cherkasy region
• Ivano-Frankivsk region
• Mykolaiv region

Despite the war and relocation, this geographical structure of the market has remained stable since 2024.

A detailed analysis of the Ukrainian IT market is available in our study:

EU-Ukraine Digital Sector Interlinkages ReportAnalytics

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EU-Ukraine Digital Sector Interlinkages Report is created by Kharkiv IT Cluster, Transilvania IT Cluster (Romania), Cluster Digital de Catalunya (Spain), IT Dnipro Community, and Odesa IT Family as part of the ITBridge project — a strategic initiative to strengthen cooperation between the European Union and Ukraine in the digital sector.

The ITBridge project is funded by the European Union through the Single Market Programme under grant agreement №101196018. Views and opinions expressed are those of the author(s) only and do not necessarily reflect those of the European Union or European Innovation Council and SMEs Executive Agency (EISMEA). Neither the European Union nor the granting authority can be held responsible for them.