UK firms boost travel & AI spend as ad budgets fall

UK businesses increased spending on travel and artificial intelligence tools in 2025 while cutting advertising budgets, according to new research from spend management firm Soldo.

Soldo's Spending Trends Spring Index 2026 suggests organisations are shifting from broad cost-cutting to more selective decisions, with investment focused on specific functions.

In the UK, travel and entertainment spending rose 12% year-on-year in 2025, while advertising fell 28%. Day-to-day operational purchases accounted for 63% of all transactions, indicating a high volume of decentralised spending across teams.

Travel rebound

The index found business travel increased after several years of tighter budgets. The 12% rise in UK travel and entertainment spending contributed to what Soldo described as a broader rebound across Europe.

Large businesses drove the increase. Average travel and entertainment spending at large UK organisations rose 17% in 2025, compared with an 8% rise for smaller firms.

The split suggests different operating assumptions: bigger companies appear more willing to fund in-person meetings and events, while smaller organisations continue to manage travel budgets more tightly.

AI spending

Technology spending, particularly on AI, rose in 2025 despite pressure on discretionary budgets. Average spending across Europe increased on the 10 most widely used AI tools, although the summary did not list the full set. The index also pointed to changes in which products businesses chose.

According to the index, spending shifted away from general-purpose AI tools towards more specialised products. AI-native coding and workflow tools saw sharp growth in average spending, suggesting wider use across technical and operational teams.

Average spending on Cursor rose 994% in 2025, while Anthropic increased 489%. The research cited these tools as examples of a broader move towards specialised AI platforms.

The report contrasted this growth with falling advertising budgets, suggesting many organisations see AI tools as more directly linked to productivity and automation than advertising and brand activity.

Advertising cutbacks

Advertising was one of the steepest-declining categories in the UK data. Spending fell 28% year-on-year in 2025, which the index linked to reduced investment in main media, paid marketing and market research.

The scale of the decline suggests marketing remains a primary source of flexibility when finance teams look for savings. It also highlights pressure on marketing leaders to justify spend as companies prioritise other areas.

The index set the reduction in advertising against continued spending in areas tied to commercial activity, such as travel. This pattern points to a rebalancing between customer acquisition and other growth activity, including in-person sales delivery and client engagement.

Operational spend

Everyday operational spending also increased. UK spending on shopping, food, services and transport rose, contributing to a 16% year-on-year increase in operational spend overall.

These purchases are often low in value but high in volume, and now account for nearly two-thirds of all transactions (63%). This suggests more spending is happening outside central procurement, with teams making frequent purchases to keep operations running.

This transaction mix has implications for internal controls, particularly for finance teams managing approvals, policy compliance and reporting across a growing number of small purchases.

"The data shows UK businesses are no longer cutting costs across the board. Instead, they are making selective investments in areas like travel and technology to support business modernisation and digital agility, while pulling back in others such as advertising. As spending becomes more decentralised, maintaining visibility and control at speed is becoming increasingly important," said Sacha Herrmann, Chief Financial Officer, Soldo.

The Spring Spend Index 2026 analyses anonymised spending data from more than 25,000 customers across seven European markets, covering Q1 2024 to Q4 2025.

Soldo said the dataset shows how spending patterns are shifting heading into 2026, with firms balancing targeted investment in travel and AI against tighter control of advertising and other discretionary costs.