US Artificial Intelligence Market Outlook to 2028

US Artificial Intelligence Market Outlook to 2028

Market Overview:

United States (US) is one of the largest contributors when it comes to Artificial Intelligence (AI). One of the reasons is, they have been investing in AI research & development for more than three decades. Especially after COVID-19 pandemic, the demand for artificial intelligence has increased in various industries which includes healthcare, transportation, retail, manufacturing etc. In the past few years, US has become a prime location for large & small organizations to work on developing relevant AI tools for smooth operational efficiency & improving customer experience.

The United States Artificial Intelligence Market is expected to grow at CAGR of ~26% by 2028. This has happened due to massive investments & growth in various kinds of artificial intelligence mechanisms, which include machine learning, deep learning, computer vision, natural language processing to name a few things. In the US region, North America has more than half of the market share. This makes it the largest economy operating not just within the country, but also within the world. Some major companies which operate within the country include IBM, Google, Amazon Web Services, NVIDIA etc. who also support start-ups to grow in the field of generative AI.

US Artificial Intelligence Industry is a highly competitive & an ever-growing market which is forecasted to reach new heights. It is catered by leading players like Microsoft, IBM, Google etc. Along with these big names, there are multiple start-ups which are operating in the US Artificial Intelligence market which offer specialized services for specific industries like UIPath, C3.ai, OpenAI, which also stands in competition towards Google.

US Artificial Intelligence Market Analysis

US Artificial Intelligence Market has been one of the oldest in the AI sphere. Over the years, the AI technology in the country has gone through various changes till today where everyone is using Artificial Intelligence for drug development, advanced manufacturing, autonomous transportation, national security & defense.

US Artificial Intelligence Market is seeing investments by large enterprises, as more than 25% of large scale companies are using artificial intelligence to develop their products & services .

Digitalization along with significant reliance on smart devices has resulted in the increasing use of AI- integrated systems for analysing large amount of data & improving overall efficiency in the United States. Other factors like high demand for intelligent virtual assistants, increased use of AI powered industrial & surgical robots & expansion of 5G infrastructure is improving the country.

Key Trends by Market Segment:

By Type of Components:The US Artificial Intelligence Market is segmented into Hardware & Software. Software & services are dominating the market, especially after COVID-19 pandemic in 2022. Currently, the software market has higher revenue over hardware because it is easier to use & has proven abilities to perform mundane tasks with ease.

By Industry:US Artificial Intelligence Market is segmented into various industries which include Healthcare, Finance, Retail & E-commerce, Manufacturing & Automotive Industry. Healthcare & finance industries have made substantial contributions towards developing the AI market in United States market. However, the manufacturing industry is more dominant in the industry due to rapid technological advancement & efficiency of services in 2022.

By Geography:

In United States, there are multiple AI-hubs which have developed over the country which have different amount of growth rates, investment levels & potential access to talent. Most of the AI-related hubs are located in Silicon Valley.

From AI-related start-ups to large-level organizations & start-ups & research institutions which are developing research-oriented technology in the Valley.

Seattle has become a major hub for companies like Microsoft & Amazon & other AI-related start-ups have developed their presence over this region.

Cities like Chicago & Detroit have been witnessing growth in AI development, particularly in industries like manufacturing, automotive & finance.

Competitive Landscape:

United States artificial intelligence market consists of many leading global players & over 13,400 start-ups which have emerged in the third quarter of 2022. Many top players within the artificial intelligence space like Google, IBM, Microsoft, Amazon Web Services etc. have their headquarters in the United States. Many AI-related companies have emerged which includes companies like OpenAI & Anthropic which are in constant competition against the leading names in the industry. Moreover, the leading players like Google & Microsoft have also invested in companies like Anthropic & OpenAI, in order to diversify their customer base along with empowering these companies to take major steps towards making it big in the generative AI sector.

Recent Developments:

US-based generative AI job postings have gone up by 20% since May, 2023, as companies are looking to harness the technology which is considered to be the next growth driver. The figure of 204 million job postings has doubled since 2021 & underlined the buzz around ChatGPT’s success.

United Kingdom (UK) and United States (US) have started developing the most powerful AI technology, as the British competition watchdog, Competition & Markets authority has launched a review of AI & the White House has advised tech firms to ensure their fundamental responsibilities of developing safer products.

Artificial Intelligence in the United States has provided a real boost to the stock market situation. The S&P 500’s (.SPX) rally has been driven by a handful of the index’s biggest stocks, a number of which are at the center of AI frenzy because of ChatGPT. A recent analysis on 20 stocks owned by AI-related exchange trading funds whose overall assets under the management have grown by almost 40% in 2023.

Future Outlook:

US Artificial Intelligence Industry is expected to show increasing and is expected to grow at a CAGR of ~26.4% from 2022 to 2027 with Government initiatives for AI development, research & deployment.

AI research & development in the United States have been developing rapidly, leading to development of sophisticated AI algorithms & models. Due to this progress, it has become easy to perform tasks which required to perform tasks which were impossible or difficult before the discovery of artificial intelligence.

The operational benefits of AI for the US government are that it has the complete potential to be revolutionized with development & further usage of AI. Machine learning has the potential to automate mundane tasks for government agencies like post offices & supply chains & make predictions based on the needs of citizens based on data collection.

By 2030, activities that account for up to 30 percent of hours currently worked across the US economy could be automated. Generative AI is likely to boost the work of STEM, creative, business & legal industry. However, the effects of automation could mean that job categories like office support, customer service & food employment may start seeing a steady decline.

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