After the Iran war, what’s next for tech?
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The past week has seen some progress, albeit uneasy and stilted, being made towards ending the Iran war.
A two-week ceasefire was agreed on Wednesday, and while it looks fragile, hopes of the conflict approaching a close are prompting analysts to look ahead and assess its longer-term impact on the global tech sector.
Exports of helium, a key material in chipmaking and other manufacturing processes, have already been significantly curtailed by the fighting, and some European companies have faced delays to semiconductor deliveries from Asia due to flight path disruption. Experts have also warned a prolonged conflict would throw uncertainty over future data center and AI infrastructure projects in the region.
Now, analysts tell me that a month-and-a-half of conflict in the Middle East has damaged its reputation as a place to invest and could see some backers look to put cash elsewhere in the world.
Local investors with deep pockets could help bolster tech projects in the region, though, and longer-term it still boasts attractive conditions for international tech companies and investors, not least due to its cheap energy and availability of land.
People wave Iranian flags while attending the funeral of Alireza Tangsiri, commander of the Iranian Revolutionary Guards’ navy alongside others killed in US-Israeli strikes on Iran at Enghelab Square in Tehran on April 1, 2026.
AFP | Getty Images
Reputation damage
The conflict is likely to weigh on near-term investor confidence in the region, Michael Field, chief equity strategist at Morningstar, said.
“For many countries, it has been a reminder of the need to prioritise national security, which will reduce cross-border investment.”
AI data center builds could also slip down the priority list for countries directly affected by the conflict, Simon Lapthorne, senior research analyst at Rathbones, told me.
“Wars inevitably increase uncertainty, hitting confidence and investment decisions well beyond the region itself,” he said.
But the impact on tech projects in the Gulf is more about timing than demand disappearing altogether, Lapthorne added.
Attacks on data centers in the Middle East will make it harder for countries to become major AI centers running workloads from customers in other regions, but AI demand within the region should continue, Ian Fogg, tech industry analyst at CSS Insight, said.
“Business cases for AI investment will likely narrow to focus on AI workloads that originate in the region and benefit consumers and businesses in the GCC area,” he added.
While Mehdi Paryavi, CEO of think tank the International Data Center Authority, told me he expects some companies to diversify investments towards other regions like Europe, Latin American and Asia-Pacific, he added that the “reality is that the Middle East region is too rich in resources to be ignored.”
The huge spending power of often state-backed local…
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