2025 has been a wild ride. As a tech or business leader, you’ve likely seen some long-teething experiments finally bloom, and others crash spectacularly. We sure did!

Back in 2023 we started an annual ‘tech wrap up’ blog, where we highlight cool gadgets or significant technology advancements. But with this year being so radical (both revolutionary and extreme) we’ve decided to focus on trends that shaped software, infrastructure, and risk.

Think of this year’s installment as ‘preparatory research’ to help formulate your 2026 resolutions, both professional and technical.

🔧 2025’s Big Waves

⚠️ ‘Vibe coding’ — coding by vibes, not variables

• What it is: Using natural language prompts to let AI (LLMs) generate code; it went mainstream. It was even named the Collins Dictionary’s 2025 Word of the Year. The developer community on reddit it quickly latched on to it as the joke of the year.
• Why it matters: For many organizations, vibe coding dramatically lowers the barrier to prototype new apps or tools. Non-engineers and small teams can trial ideas fast, speeding up innovation cycles, reducing overhead, and democratizing software creation.
• Risks that grew: Early empirical evidence shows big red flags. According to the 2025 GenAI Code Security Report from Veracode, nearly 45% of AI-generated code samples failed security tests, often introducing OWASP-level vulnerabilities (e.g. XSS, injection). A 2025 Cornell University study comparing human vs. AI-generated code, found that AI variants tend to be simpler but much more bug-prone, with more unused constructs, hardcoded debug leftovers, and common security flaws, often expensive to find and fix later.

🧩 Legacy-system modernization finally picks up steam

• What shifted: Legacy systems are the primary contributor to innovation drag for businesses, still, in 2025. But 2025 saw renewed urgency to update or replace them. Strangler Fig, Cloud-Hybrid Architecture, Robotic Process Automation, Middleware and Containerization have all contributed to modernization efforts gaining momentum this year.
• Why it’s significant: Modernizing legacy systems reduces technical debt, improves scalability & agility, and lays a foundation for integrating modern AI, cloud, or microservices architecture. It also reduces long-term maintenance and security burdens.
• Risks and caveats: Migration is hard. Some legacy apps have deep entanglements, poor documentation, or deprecated dependencies — moving them to cloud or modern stacks can introduce subtle bugs, outages, and compliance issues. Seeking support from third party experts is often the best first move for legacy modernization.

🎉 Explosion in AI-based development tools & Agentic AI experimentation

• What trended: Beyond vibe coding, 2025 saw growth in what analysts call “agentic AI”. AI systems capable of planning and executing multi-step tasks, helping with everything from code generation to workflow automation.
• Why it matters: This trend reshapes how teams are structured: less manual repetitive work, more orchestration, design, prompt-engineering, integration, and oversight. Productivity gains especially for prototypes and internal tools can be significant.
• Risks: Agentic AI is still early. Over-relying on it can lead to poor maintainability, misalignment with business logic, even security oversights. AI may do what you ask, but not always what you mean. Knowing the difference if part of a growing skills gap: prompt engineering and AI-system oversight require new expertise.

🚀 Cloud & hybrid/edge-cloud infrastructure + modernization of architecture

• What shifted: As part of modernization, many organizations expanded cloud usage — public, private, and hybrid — and embraced edge/cloud-native architectural patterns to support modern workloads, especially AI, data streaming, and real-time services. We wrote about how to justify this in your 2026 budget just last week.
• Why it matters: This gives companies scalability, flexibility, and the ability to deploy services globally with lower latency. It also positions them to leverage modern AI, analytics, and data-driven applications without being shackled by outdated on-prem infrastructure.
• Risk/regulatory concerns: As cloud/edge adoption grows, so do the challenges. Governance, data sovereignty, compliance, multi-cloud complexity, cost unpredictability, and increased attack surface for cyber threats all highlight why 80% of companies seek outside support for their cloud related needs.

💡 Increasing cyber-threat sophistication — AI-powered attacks & cyber-risk escalation

• What surged: 2025 saw an uptick in advanced, automated cyberattacks. According to the CrowdStrike 2025 Global Threat Report, adversaries are now running cybercrime like a business, leveraging automation, AI, cloud intrusions, and malware-free techniques. Also, the broader cyber-risk environment continues to intensify under the lens of supply-chain attacks, ransomware-as-a-service, and AI-powered spear-phishing or deep-fake attacks.
• Why it’s critical: As companies adopt more cloud, AI, and hybrid infrastructure, exposure increases. Data becomes more valuable, and more vulnerable. Cyber resilience is now a business-critical strategy.
• Risks: Legacy systems or modern deployments without strong security posture now stand out as low-hanging fruit. Supply-chain weaknesses, misconfigurations, insufficient patching or reliance on opaque AI-generated code (like vibe-coded apps) can all serve as attack vectors.

🔮 Looking Ahead: Shaping 2026’s Strategy

As you plan for 2026 consider these takeaways:

🌐 Adopt AI – but govern it strictly. Use vibe coding (sparingly) and agentic AI for prototypes, internal tools, and experiments. But treat production-grade code like traditional code: enforce reviews, testing, security audits, and documentation standards. Think of AI as a ‘power tool,’ not a magic wand.

🏗️ Modernization isn’t optional, it’s foundational. If your organization is still running on legacy systems, build a modernization roadmap now. Cloud or hybrid-cloud architecture, containerization, CI/CD automation, and modular design will make your company resilient and flexible for future AI & data workloads. Don’t wait to seek advice if you need help getting started.

🔒 Make cybersecurity a first-class citizen. Increase investment in threat detection, identity hygiene, zero-trust architecture, secure supply-chains, and dev-ops security practices. As cyber-attacks become AI-driven, reactive defense won’t be enough; proactive security and risk modeling are critical.

🧑‍💻 Reshape the team and skills mix. In 2026, expect to need prompt-engineers, AI-orchestration leads, cloud-native architects, security-first devs, and legacy-system maintainers. The mix of human + AI + infrastructure will define competitive advantage. Smart planning can keep you out of the AI buyers’ remorse trap.

📈 Treat infrastructure & data pipelines as strategic assets. Whether modernizing legacy systems, building new services, or adopting AI tools — the reliability, flexibility, and security of your infrastructure will be key differentiators.

🔚 Final Thoughts: Outtakes from 2025

2025 showed us that the future of software isn’t just faster, it’s messier, ambiguous, hybrid, and full of trade-offs. ‘Vibe coding’ offered glamour and speed; legacy modernization promised stability and long-term value; AI and cloud opened new frontiers; while cyber-threats kept us humble and reminded us of the stakes.

For 2026, success won’t belong to businesses that chase trendy buzzwords; it’ll belong to those who balance ambition with discipline, innovation with governance, and speed with security. Use the tools, go ahead, but don’t underestimate the responsibility that accompanies these choices.

Spiderman was on to something when he said, ‘with great power comes great responsibility’. As we slip into the holiday season and turn the page on a new year remember this: build for flexibility but not at the expense of maintainability; and always remember, in tech, resilience isn’t just optional. It’s survival.

At STEP Software we have been supporting legacy modernization initiatives with our clients for over 15 years, we are experts in our space and are here to help. Reach out for a free 30-minute consultation with one of our advisors to see how we can help.