UK bosses see AI reshaping business within two years

Nine in ten UK chief executives expect artificial intelligence to have at least a significant — if not transformative — impact on their business model or operations within the next two years, according to a new survey from EY-Parthenon.

The consulting firm, working with FT Longitude, polled 100 CEOs of public and private companies in the UK for its CEO Outlook 2026 study. A majority, 57%, said they are currently in the middle of a major enterprise-wide transformation, and another 41% plan to start one in the next 12 months.

CEOs bet big on AI while keeping an eye on the risks

Nearly every respondent — 96% — said their company will invest in emerging technology over the coming year. Of that group, 40% called AI investment critical to their organization’s future resilience.

Despite the common fear that AI will replace jobs, 62% of the executives said they believe investments in the technology will help them maintain or even grow employment levels in the next year. The tech has been linked to shrinking graduate hiring at some big professional services firms, but the survey suggests many CEOs see it differently.

Still, enthusiasm has limits. More than a third said they’re worried about cybersecurity risks tied to AI adoption, and 23% pointed to high upfront running costs as a concern.

The pattern of CEO optimism running up against practical worries isn’t new. Similar tensions played out when cloud computing and big data first gained traction — companies saw potential but balked at security and cost questions. The current AI wave appears to follow a familiar script.

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Silvia Rindone, EY UK&I managing partner for EY-Parthenon, said: “While there is excitement surrounding the potential of AI, the reality for CEOs is far more complicated. It is essential that business leaders adopt a pragmatic approach that acknowledges the transformative impact of AI while also addressing challenges such as cybersecurity risks, the rules set by regulators, and upskilling their workforce.”

Profit outlook strong but operating costs are climbing

Separately, 89% of the CEOs said they expect their company’s profitability to rise in 2026, echoing findings from a Forvis Mazars survey of C-suite executives. But 47% also anticipate higher operating costs.

Geopolitical and trade policy changes have already reshaped investment plans. Over the last 12 months, 78% of leaders altered their strategic investment strategies in response to such developments — 32% delayed a planned investment, 31% accelerated one, and 9% scrapped a move entirely.

The survey also shows strong dealmaking intentions. Almost all respondents said they intend to pursue some kind of transaction in the next year. More than half are looking at mergers and acquisitions, 16% at divestments or spin-offs, and 83% at joint ventures or strategic alliances to get quick access to new capabilities.

Rindone added: “UK CEOs are recalibrating their strategies, demonstrating remarkable resilience and adaptability, while also showing a willingness to make bold decisions in the face of ongoing geopolitical and economic uncertainty.”

EY-Parthenon has previously noted that in an unpredictable macro environment, leading CEOs will “act on imperfect information…and learn through iteration rather than waiting for certainty.” Rindone said those who actively reassess capital allocation, handle geopolitical complexity, and pursue technology-driven M&A will be better positioned to weather market volatility and seize opportunities in 2026.