Artificial Intelligence Market Growth, Size, Share, Trends, Key Players Analysis, and Forecast till 2031

The artificial intelligence market size was valued at US$ 193.25 billion in 2024 and is expected to reach US$ 1,706.71 billion by 2031; it is estimated to register a CAGR of 37.8% during 2025–2031. The burgeoning popularity of agentic Al is likely to bring new market trends in the future.

Artificial Intelligence Market Analysis

The rising adoption across industries, government initiatives and investment to support the adoption of AI technology, and the burgeoning demand for multimodal AI are among the significant factors driving the global artificial intelligence market expansion. Further, increasing investments in industrial automation solutions and the growing popularity of agentic Al is likely to propel the demand for artificial intelligence in the future. Technological advancements and integration of advanced technologies such as machine learning, natural language processing (NLP), and robotic process automation (RPA); demand for generative Al; and development of explainable AI (XAI) and AI-powered cybersecurity solutions that reduce operating costs are expected to create opportunities for the market during the forecast period. An upsurge in the need for customized AI-based solutions, manufacturers' focus on developing small language models and open source advancements, and an increase in research and development activities also benefit the global artificial intelligence market.

Artificial Intelligence Market Overview

Artificial intelligence (AI) operates as a combination of technologies that allow computers to perform a wide range of advanced operations, such as reading, understanding, translating spoken and written language, analyzing data, and making suggestions. AI serves as the basis of current innovations in computing, creating value for individuals and enterprises. For example, optical character recognition (OCR) uses AI to extract text and data from photos and documents, transforming unstructured content into business-ready structured data and providing crucial insights. Industries use AI-based systems and software in a variety of applications, including speech recognition, image recognition, translation, predictive modeling, data analytics, and cybersecurity. Significant benefits offered by AI include 24 × 7 availability, repetitive task automation, fewer human errors, more and faster data insights, reduced physical risks, and enhanced decision-making.

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Artificial Intelligence Market: Strategic Insights

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Artificial Intelligence Market Drivers and Opportunities

Government Initiatives and Investments Supporting AI Adoption

In January 2025, US President Donald Trump announced a private sector investment of up to US$ 500 billion to accelerate the development of AI infrastructure in the nation. The initiative is designed to strengthen America's competitive position in this vital sector. At the core of the announcement is a new joint venture called Stargate, formed by OpenAI, SoftBank Group Corp. (9984.T), and Oracle Corporation (ORCL.N). Stargate will focus on building advanced data center infrastructure in the country and is projected to generate over 100,000 new jobs nationwide. Backed by a coalition of equity partners, Stargate has already secured a US$100 billion initial investment for immediate deployment. The remaining US$400 billion is expected to be invested over the next four years as part of a phased capital allocation strategy. The initiative was formally launched at the White House, where SoftBank CEO Masayoshi Son, OpenAI CEO Sam Altman, and Oracle Chairman Larry Ellison joined Trump to underscore their commitment to positioning the US as a global leader in AI.

Techs and consulting companies, including Accenture Plc, Contents SpA, Aleph Alpha GmbH, and Mistral AI, are investing in AI technology. In June 2023, Accenture Plc announced an investment of US$ 3 billion to accelerate the development of new AI-based solutions. The company is planning to use these solutions to help businesses from across 19 industries, such as manufacturing, retail, and healthcare. These investments are made to develop and implement AI technology in various processes to manage a high volume of data. Thus, initiatives and investments by governments and private organizations support the adoption of AI.

Soaring Demand for Generative Al

Generative AI enables firms to function efficiently and stay ahead of their competitors. Governments of various countries are organizing events to create awareness related to the benefits provided by generative AI. In April 2025, California Governor Gavin Newsom announced a new statewide initiative to integrate generative AI technologies across government functions. The initiative aims to leverage AI to optimize traffic management, enhance road safety, and improve public-facing services, such as customer support. In an official statement, Governor Newsom emphasized that the effort is focused on enhancing and not reducing government services, reinforcing the state's commitment to innovation-driven public sector improvement.

According to data released by Infosys Limited in December 2023, countries across the globe are investing in generative AI technology to streamline and automate operations, enhance product development, and optimize customer experiences. Between 2022 and 2023, France and Germany doubled their GenAI spending to approximately US$ 730 million and US$ 610 million, respectively. In both countries, ~50% of businesses have either deployed generative AI or have implemented and achieved business value from it. Roughly 40% of companies in the UK, Benelux, and Nordics invest in AI technology to improve their business operations. In December 2023, the UK surpassed Benelux to take third place, as its spending is likely to increase two-fold or more to reach approximately US$ 510 million. In 2023, companies in Nordic countries invested more than 2.5 times their present spending, totaling more than US$ 470 million in GenAI. Thus, the development of generative AI tools and models for managing business processes is expected to create future growth opportunities in the global artificial intelligence market.

Artificial Intelligence Market Report Segmentation Analysis

Key segments that contributed to the derivation of the artificial intelligence market analysis are component, organization size, and industry vertical.

• Based on component, the market is divided into hardware, software, and services. The market for the software segment is segmented into cloud-based and on-premise. The software segment dominated the market in 2024.
• By organization size, the global artificial intelligence market is categorized into large enterprises and SMEs. The large enterprises segment dominated the market in 2024.
• On the basis of industry vertical, the market is segmented into automotive, healthcare, manufacturing, retail and e-commerce, IT and telecom, BFSI, and others. The IT and telecom segment dominated the market in 2024.

Artificial Intelligence Market Share Analysis by Geography

• The artificial intelligence market is segmented into five major regions: North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South & Central America. North America dominated the artificial intelligence market in 2024. Europe is the second-largest contributor to the global artificial intelligence Market, followed by Asia Pacific.
• The artificial intelligence market in North America is categorized into the US, Canada, and Mexico. North America is home to tech giants such as Microsoft, Google, and Amazon, which invest heavily in AI research, cloud platforms, and generative AI. The venture capital funding for AI startups hit US$ 40 billion in 2023, fueling innovation. Government initiatives, such as the US National AI Initiative and Canada’s Pan-Canadian AI Strategy, support research and public-sector adoption. Key industries include healthcare (diagnostics), finance (fraud detection), and automotive (autonomous vehicles). A robust talent pool, bolstered by leading universities, strengthens the region’s position. However, regulatory fragmentation, such as California’s CCPA, and intense competition for AI talent increase costs. Cybersecurity risks and ethical concerns around AI bias also pose challenges, requiring businesses to prioritize compliance and transparency to maintain consumer trust and market dominance.

Artificial Intelligence Market Regional Insights

The regional trends and factors influencing the Artificial Intelligence Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Artificial Intelligence Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.

Artificial Intelligence Market Report Scope

Artificial Intelligence Market Players Density: Understanding Its Impact on Business Dynamics

The Artificial Intelligence Market market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.

Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.

Major Companies operating in the Artificial Intelligence Market are:

1. Accenture Plc
2. Advanced Micro Devices Inc
3. Google LLC
4. International Business Machines Corp
5. Intel Corp
6. Microsoft Corp

Disclaimer: The companies listed above are not ranked in any particular order.

Artificial Intelligence Market News and Recent Developments

The artificial intelligence market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. Key the developments in the artificial intelligence market are listed below:

• IBM launched Watsonx AI Labs, a new, developer-first innovation hub in New York City designed to supercharge AI builders and accelerate AI adoption at scale. watsonx AI Labs connects IBM's enterprise resources and expertise with the next generation of AI developers to build breakthrough AI applications for business.

(Source: IBM, Press Release, June 2025)

• Accenture announced that Accenture Ventures has invested in Aaru, creators of the AI-powered prediction engine that simulates consumer behavior and preferences, driving stronger customer experiences, new growth opportunities, and speed-to-market. As part of this collaboration, Accenture Song intends to integrate Lumen—Aaru’s flagship model for the private sector—into its AI products and services across new product development, marketing, customer strategy, and customer service.

(Source: Accenture, Press Release, March 2025)

Artificial Intelligence Market Report Coverage and Deliverables

The "Artificial Intelligence Market Size and Forecast (2021–2031)" provides a detailed analysis of the market covering the areas mentioned below:

• Artificial intelligence market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
• Artificial intelligence market trends, as well as market dynamics such as drivers, restraints, and key opportunities
• Detailed PEST and SWOT analysis
• Artificial intelligence market analysis covering key market trends, global and regional framework, major players, regulations, and recent market developments
• Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments for the artificial intelligence market
• Detailed company profiles