Artificial Intelligence Market Insights, Growth, and Future Scope by 2031
The global artificial intelligence market is on a trajectory of phenomenal growth, projected to leap from US$29.9 Bn in 2019 to an impressive US$718.7 Bn by 2029. Between 2022 and 2030, the market is anticipated to register a staggering CAGR of 31.2%, underscoring the transformative potential of AI across various sectors.
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Market Size and Trend Analysis
Artificial intelligence (AI) continues to be one of the fastest-evolving technologies, with vast applications across numerous industries worldwide. Its role in influencing the global economy and national security has been exceptional. The forecast period promises stellar growth for the AI market, driven by significant investments from global giants such as Amazon, Google, Apple, IBM, Microsoft, and Facebook in AI research and development.
Key Report Findings
Market Size: The worldwide AI market size is projected to exceed US$718.7 Bn by 2030.
Service-Based Models: These remain at the core of developmental strategies for key industry participants.
Economic Gains: North America and China are expected to witness the largest economic gains from AI technology.
BFSI Segment: AI consumption by the banking, financial services, and insurance (BFSI) segment equals over 28% of the total market valuation.
Regional Revenue: North America’s AI market accounts for over 29% of global industry revenue.
Growth Drivers
An Influx of Investments
The International Trade Administration (ITA) reported a twofold growth in global AI funding in 2021 compared to the previous year, with around 65 AI companies reaching the billiondollar valuation mark. This surge indicates a massive AI wave worldwide, as many
governments and organizations embrace AI as a crucial component of their business strategies. Between 2020 and 2022, total annual corporate global AI investments in startups rose by nearly US$5 Bn, setting the stage for notable long-term growth in the AI industry.
Rising Demand from Healthcare Industry
AI is revolutionizing the healthcare industry by enabling the scanning of pre-existing medications and redesigning their usage to combat specific diseases, significantly reducing drug development costs. AI-based solutions also enhance customized healthcare services, improving patient outcomes and accessibility. AI-enabled chatbots and end-to-end assistance systems ensure security and safety amidst fraud risks, driving high demand in the healthcare sector.
Growth Challenges
Inadequate Expertise to Operate AI
The data science field struggles with a lack of expertise, further aggravated by the deepening penetration of automation technologies. The growing need for comprehensive capabilities in AI and machine learning continues to pose a challenge, potentially hindering market growth through 2030.
Overview of Key Segments
Adoption Highest in BFSI
Sector
With more than a 28% revenue share in the global AI market, the BFSI segment is expected to maintain its lead in the long term. The widening uptake of AI technology for FinTech applications, risk assessment, financial analysis, portfolio management, and regulatory compliance drives the BFSI industry's performance in AI consumption. The rapid expansion of e-commerce also boosts AI adoption in retail, contributing to the segment's strong market positioning.
Healthcare to Emerge Lucrative
AI adoption in healthcare is poised to surge, with potential use cases in hospital workflow management, robotic surgeries, nursing and medication assistance, clinical trials, and primary diagnosis. Other key verticals include automotive and transportation, retail, agriculture, manufacturing, and e-commerce. Manufacturing and government & defense sectors, contributing more than 25% of the global AI market value, present significant growth opportunities.
Growth Opportunities Across Regions
North America’s Primacy Intact
Banking on higher government and public sector spending on AI technology, North America will retain its leading position in the global AI market. The region accounts for more than 29% of the overall market valuation. The US market enjoys a first-mover advantage,
supported by the American AI Initiative launched in 2019, which established guidelines for AI development and implementation, significantly boosting the North American market.
Asia Pacific All Set for an AI-Ready Future
With substantial investments flowing in, the Asia Pacific market for artificial intelligence will demonstrate significant revenue growth through the forecast period. The region will benefit from a thriving startup sector, improving funds, and a growing inclination toward process automation and efficiency. Asia Pacific’s AI market represents more than a fourth of the global market valuation.
Key Players in the AI Industry
Leading companies steering the competitive landscape of the AI market include Microsoft Corporation, Cisco Systems, Sailpoint Technologies, IBM, Oracle, DELL, CA Technologies, HITACHI, and Okta. These companies are driving innovation through strategic investments and advancements in AI technology.
Conclusion
The global artificial intelligence market is set for extraordinary growth, driven by technological advancements, significant investments, and rising demand across various sectors. With a projected valuation of US$718.7 Bn by 2029 and a CAGR of 31.2% between 2022 and 2030, AI is poised to revolutionize industries and drive substantial economic gains globally. Key players and regions are positioning themselves to leverage AI's transformative potential, ensuring a dynamic and competitive market landscape in the coming years.