2026 is set to be the year of agentic AI, industry predicts

Agentic artificial intelligence tools are slated to dominate federal and consumer markets in the coming year, major tech players predict, underscoring the role data organization and cloud computing will play in delivering tailored agentic solutions.

Agentic AI, which describes autonomous AI systems that are capable of executing specific tasks with little to no human interaction required, was a hot topic in federal and private sector procurement. Major vendors are responding to the ongoing demand for agentic technology with a holistic infrastructure approach for the coming year. 

“Agentic AI is where the industry is headed, is where our customers are headed. It's where they're demanding outcomes,” Rishi Bhaskar, director of public sector partner sales at Amazon Web Services, told Nextgov/FCW. “But that starts in the data journey.”

Bhaskar described the AWS approach to delivering agentic AI solutions as a broader journey that must both modernize legacy infrastructure and code, as well as refine and organize data to make it easy to turn into actionable information. He further anticipates the customer base will be looking for outcome-driven AI tools to augment current workflows in lieu of proof-of-concept ideas. 

“That's really where we see our customer base going: ‘How do we leverage traditional models of AI, agentic AI, to really solve complex business problems and deliver on outcomes?’” Bhaskar said. 

Cisco executives said the company is hearing similar feedback from its customers. 

“As the year 2025 closes and 2026 begins, the sentiment among government technology leaders has shifted from ‘what is possible’ to ‘what can we operationalize,’” Kapil Bakshi, a distinguished engineer within the Office of the Chief Technology Officer at Cisco’s U.S. Public Sector branch, told Nextgov/FCW. 

Both Bakshi and Bhaskar observed a pivot away from chatbot capabilities and a drive towards more actionable investments in AI systems. Bakshi added that public and private sector customers will be looking more for domain-specific models that can handle particular tasks. 

Oracle is moving into 2026 with an extra focus on updating data assets to enable “context-aware AI,” a core feature of agentic solutions. 

“The approach that Oracle has always taken, because we are a data-first company, is: AI that knows your data is the only useful AI out there,” Peter Guerra, vice president of Data and AI for Government Defense and Intelligence at Oracle, told Nextgov/FCW. “What we are looking forward to from our customers working specifically in the federal space is a continued path of modernization of that data asset to enable context-aware AI.”

Guerra said that agentic AI success hinges on understanding specific workflows and modernizing current data resources. He cited a current contract with the U.S. Army where Oracle is synchronizing data from different applications together to deliver a better picture of warfighter conditions as an example. The premise of this project is bringing together disparate data into an AI application to accomplish workflows in more efficient ways. 

“It's really clearly a data modernization path for our federal customers,” Guerra said. "It's the true enablement of AI agents at scale that can solve some of the workflow challenges and process challenges that they have.”

The workflows AWS, Oracle, and Cisco will look to automate with agentic solutions vary, but include network traffic management, data entry and document review. AWS and Cisco both see this as supplementing human labor.

“We have tremendous opportunity for our civil servants, our partners … to actually get away from manual, repetitive tasks and shift to the value at creation that we all like to do,” Bhaskar said. 

Cloud computing infrastructures that can further scale data-reliant agentic AI tools are also a major deliverable for 2026. Guerra said that a partnership with the Department of Energy is meant to create an AI “cluster” network on Oracle's cloud product as a vehicle to process large volumes of data.

“If you look from a commercial standpoint where Oracle Cloud is being used, we're used very heavily in the AI startup space and the frontier model companies and so forth,” Guerra said. “[The cloud] gives customers the flexibility they need, from a consumption standpoint, to consume just what they need." 

Bhaskar echoed Guerra’s comments about data needing to be in the correct place and in the correct format to deliver value to agentic software. AWS, which has long been a major player in the federal cloud computing market, launched its AWS Transform agentic product in early December specifically tailored to accelerate system modernization by moving applications into a cloud environment and testing resources to verify migration success. 

“Speed and acceleration, I think, [are] also important,” Bhaskar said. “The faster we can get the cloud, the faster we can unlock innovation, the faster we can move as a global economy.”