Artificial Intelligence (AI) Market Size Estimated to Reach USD 2,575.16 Bn by 2032

Ottawa, Dec. 14, 2023 (GLOBE NEWSWIRE) --

The global artificial intelligence (AI) market size was valued at USD 454.12 billion in 2022 and the sector is expanding at a double-digit CAGR of 19% from 2023 to 2032.

The Artificial Intelligence (AI) market is driven by the increasing volume of data generated across industries, the advent of Industry 4.0, technological advancement, and growing investment.

Key Highlights:

• North America led the global market with the largest market share of 36.90% of in 2023.
• The Asia Pacific market is expected to expand at the highest CAGR of 20.3% from 2023 to 2032.
• By Technology, the deep learning segment has accounted for over 36.90% market share in 2023.
• By Solution, the services segment has accounted for a market share of over 39. 40% in 2023.
• By End-user, the BFSI segment accounted for 17.10% of the market share in 2023.

Artificial Intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think and learn like humans. The goal of AI is to develop systems that can perform tasks that typically require human intelligence, such as visual perception, speech recognition, decision-making, and language translation. AI encompasses a broad range of technologies and approaches, with the overarching aim of creating machines that can exhibit intelligent behavior, adapt to new situations, and improve their performance over time.

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The growing funding by the government is expected to propel the market growth during the forecast period. For instance, in December 2023, a $17 million initiative aimed at encouraging artificial intelligence (AI) in Australian businesses was disclosed by the federal government. The proposal, which was introduced by Ed Husic, Minister of Industry and Science, seeks the establishment of up to five AI adoption centers by the Australian government. Each center will focus on companies operating in one of the National Reconstruction Fund's top priority areas, establishing a network of industry-specific centers and providing free training to qualified companies.

• According to IBM, 35 percent of companies have already adopted AI. The data below makes it evident that most CEOs are enthusiastic about AI's ability to improve capabilities and cut costs. Machine learning has reportedly already saved Netflix $1 billion, and AI can increase corporate performance by up to 40%.
• According to secondary analysis, AI will reduce employment by 85 million by 2025, but it will also generate 97 million new jobs, adding 12 million additional employment opportunities overall.

Artificial Intelligence (AI) Market Size by Regions

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• Canada artificial intelligence (AI) market was valued at USD 43.7 billion in 2022 and it is expected to reach around 251.3 billion in 2032, at a CAGR of 19.2% from 2023 to 2032.
• Germany  artificial intelligence (AI) market was valued at USD 25.7 billion in 2022 and it is projected to grow at a CAGR of 20.6% from 2023 to 2032.
• South Korea artificial intelligence (AI) market was valued at USD 16.3 billion in 2022 and it is expanding at a CAGR of 21.1% from 2023 to 2032.
• Japan artificial intelligence (AI) market was valued at USD 20.2 billion in 2022 and will reach a CAGR of 21.0% from 2023 to 2032.

North America is expected to hold the largest market share over the forecast period. The Artificial Intelligence market growth in the region is attributed to the presence of major IT companies such as IBM Corporation, Intel Corporation, Google LLC, Microsoft and Others. The continuous innovation in the AI industry by these players majorly driven the market expansion in the region.

For instance, in September 2023, with the addition of Microsoft Copilot to its lineup of products—a ground-breaking AI companion that aims to revolutionize human-technology interaction—the company, a pioneer in global technological innovation, is bringing in a new era of artificial intelligence. This innovative innovation combines the capability of large-language models and chat interfaces to enable people to converse with technology in natural language and get thoughtful, context-aware replies and other actions.

Additionally, the growing investment is expected to drive market expansion in the North American region. For instance, more than 25% of all venture capital invested in American startups in 2023 went toward AI-related businesses, a huge rise above the prior year's average of about 12% between 2018 and 2022.

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Artificial Intelligence (AI) Market Scope

Global Artificial Intelligence Market Revenue, by Solution (US$ Billion)

The software segment held the largest market share in 2022 and is expected to show the same pattern during the forecast period. A wide range of products, such as computer vision software, machine learning frameworks, natural language processing tools and AI development platforms, are available in the AI software industry. These tools address many facets of developing AI applications. In addition, NLP software has become more and more popular as conversational AI and chatbot have grown in popularity.

Applications such as sentiment analysis and virtual assistants are made possible by these technologies, which make it possible to analyze and comprehend human language. This is expected to propel the segment expansion over the forecast period.   

Global Artificial Intelligence Market Revenue, by Technology (US$ Billion)

The deep learning segment held the largest share of 36.90% in 2023. Deep learning models benefit significantly from large volumes of data. The availability of extensive datasets for training allows deep learning algorithms to generalize well, enhancing their performance across diverse scenarios. As the volume of data in various industries continues to grow, deep learning becomes increasingly effective.

The deep learning approach has gained widespread adoption across industries due to its proven success in solving complex problems. Significant research and development investments have been directed toward improving deep learning techniques, leading to a rapid evolution and refinement of models.

The machine learning segment is estimated to witness the fastest rate of growth. AI and machine learning market are experiencing significant growth across industries. Businesses are increasingly recognizing the value of leveraging machine learning techniques to gain insights, automate processes, and make data-driven decisions. Machine learning applications are widespread across various sectors, including healthcare, finance, retail, manufacturing and technology. These applications ranged from predictive analytics and recommendation systems to autonomous vehicles and fraud detection.

Deployment Insights

The cloud segment is estimated to grow at the highest CAGR during the forecast period. Cloud platforms provide the scalability and flexibility required for AI applications, allowing businesses to access computing resources on demand. This is particularly advantageous for handling large datasets and training complex machine learning models. In addition, the growing collaboration in the market offers a lucrative opportunity for market revenue development during the analysis period.

For instance, in August 2023, Google Cloud and General Motors released further information on their partnership to integrate conversational AI technology into billions of GM vehicles, which will benefit drivers in several ways. Equipped with sophisticated intent-recognition algorithms that leverage Google Cloud's conversational AI technologies, GM's OnStar Interactive Virtual Assistant (IVA) has been supplying routing and navigation support as well as answers to frequently asked questions since its introduction in 2022. GM and Google Cloud will now be working together to test more generative AI installations after the latter company's AI was successfully integrated into GM's OnStar service. Thus, driving the market growth.

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Market Dynamics:

Driver

Growing automation demand

AI-powered automation, such as autonomous systems and robotic process automation (RPA), is removing tedious and repetitive jobs that used to take up precious human resources. This change frees up human laborers to concentrate on higher-value jobs that demand imagination, analysis, and problem-solving skills. Robots and systems driven by AI are being used in industries including manufacturing, logistics and customer service to manage anything from inventory to customer relations. As a result, productivity increases but also accuracy and consistency are improved. Automation solutions that advance human abilities and foster business development are growing in popularity as more and more businesses realize how AI may completely transform their operations.

Restraint

Security issues and lack of skilled professional

As AI systems rely on large datasets for training and decision-making, there are concerns about the privacy and security of sensitive data. Ensuring the responsible and ethical use of AI, especially in areas like healthcare and finance, is a significant challenge. For instance, According to Fortified Health, hacking and IT events accounted for 78% of data breaches in 2022, up from 45% in 2018. Additionally, there is a shortage of skilled professionals with expertise in AI and machine learning. As demand for AI talent increases, organizations face challenges in recruiting and retaining qualified individuals. According to the World Economic Forum's Future of Jobs Report 2023, professionals in artificial intelligence and machine learning are expected to rise at the quickest rate in the coming years, with a 40% increase in employment expected by 2027.

Opportunity

Increasing collaboration in healthcare           

The growing collaboration in healthcare is expected to offer an enormous opportunity for market growth during the forecast period. AI accelerates the drug discovery process by analyzing vast datasets related to molecular structures, genetic information and clinical trial results, which can lead to the identification of potential drug candidates more quickly and cost-effectively.

For instance, in December 2023, BigHat Biosciences and AbbVie Inc. started a research partnership to find and create next-generation therapeutic antibodies in the fields of brain and cancer. Under the partnership, BigHat aims to work closely with AbbVie to assist in the creation and selection of high-quality antibodies for a variety of therapeutic targets. It will do this by utilizing its MillinerTM platform, a suite of machine learning technologies coupled with a high-speed wet lab. This partnership is yet further evidence of their dedication to incorporating AI/ML-based methods into drug research and development, as they work to quicken their pipeline for cancer and neurology and produce better medications more quickly.

Related Reports:

• Cloud Services Market: The global cloud services market size was estimated at USD 454.20 billion in 2022, and it is expected to reach around USD 2,192.54 billion by 2032 and is poised to grow at a compound annual growth rate (CAGR) of 17.10% between 2023 and 2032.
  
  
• Augmented Intelligence Market: The global augmented intelligence market size was valued at USD 14.74 billion in 2022 and it is expected to hit around USD 142.3 billion by 2032, growing at a registered CAGR of 25.5% from 2023 to 2032.
  
  
• Machine Learning as a Service Market: The global machine learning as a service market size accounted for USD 22.86 billion in 2022 and is projected to hit around USD 626.64 billion by 2032, growing at a CAGR of 39.3% during the forecast period from 2023 to 2032.
  
  

Recent Developments:

• In September 2023, prior to "Open Source Summit Europe 2023," Fujitsu Limited and the Linux Foundation announced the formal release of Fujitsu's automated machine learning and AI fairness technologies as open source software (OSS). Users will have access to both a technology that corrects latent biases in training data and software that automatically writes code for new machine learning models due to these two initiatives. To inspire developers worldwide to further experiment and innovate with AI and machine learning technologies, the Linux Foundation approved the incubation of two new projects, "SapientML" and "Intersectional Fairness." Future events, such as hackathons, will be held to engage and foster community members in support of open source AI.
• In March 2023, Salesforce, a pioneer in customer relationship management (CRM), introduced Einstein GPT, the first generative AI CRM system in the world. This technology provides hyperscale AI-generated content for every sales, service, marketing, commerce, and IT interaction. Salesforce will use generative AI and Einstein GPT to revolutionize every customer experience. Salesforce's own AI models will be enhanced by Einstein GPT with generative AI technology from a network of partners and real-time data from the Salesforce Data Cloud, which consumes, harmonizes, and integrates all of a business's customer data. After connecting their data to Einstein GPT, users can use OpenAI's sophisticated AI models straight out of the box, or they can select an external model and use natural language prompts within Salesforce CRM to create content that dynamically adjusts in real-time to changing customer needs and information.

Market Key Players:

• Intel Corporation
• Microsoft
• IBM
• Google
• Amazon Web Services
• Baidu, Inc.
• NVIDIA Corporation
• H2O.ai.
• Lifegraph
• Sensely, Inc.
• Enlitic, Inc.
• AiCure
• HyperVerge, Inc.
• Arm Limited
• Clarifai, Inc.
  

Market Segmentation

By Offering

• Hardware 
• Software 
• Services
  

By Technology

• Machine Learning 
• Natural Language Processing 
• Context-Aware Computing 
• Computer Vision

By Deployment

• On-premise 
• Cloud

By Organization Size

• Large enterprises 
• Small & medium enterprises (SMEs)

By Business Function

• Marketing and Sales 
• Security 
• Finance 
• Law 
• Human Resource 
• Others

By End-Use

• Healthcare
  • Robot Assisted Surgery
  • Virtual Nursing Assistants 
  • Hospital Workflow Management 
  • Dosage Error Reduction 
  • Clinical Trial Participant Identifier 
  • Preliminary Diagnosis 
  • Automated Image Diagnosis
• BFSI
  • Risk Assessment 
  • Financial Analysis/Research 
  • Investment/Portfolio Management
  • Others
• Law 
• Retail 
• Advertising & Media 
• Automotive & Transportation 
• Agriculture 
• Manufacturing 
• Others

By Geography

• North America
• Europe
• Asia-Pacific
• Latin America
• The Middle East and Africa
  

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