Embedded AI Market Growth – Trends & Forecast 2024-2034

Embedded AI Market Outlook from 2024 to 2034

The embedded AI market is projected to be worth USD 9.5 billion in 2024. The market is anticipated to reach USD 36.2 billion by 2034. The market is further expected to surge at a CAGR of 14.3% during the forecast period 2024 to 2034.

Key Market Trends and Highlights

There is a growing emphasis on developing energy efficient AI models and hardware, as embedded AI finds applications in battery powered devices, which is crucial for applications in sectors such as wearables, where prolonged battery life is a key consideration.

• The automotive industry is increasingly incorporating embedded AI for applications like advanced driver assistance systems, autonomous vehicles, and in-car infotainment. The growth of electric vehicles and connected cars further fuels this trend.
• Embedded AI is playing a significant role in various healthcare applications, such as medical imaging, remote patient monitoring, and predictive analytics. The demand for more efficient and intelligent healthcare solutions is driving growth in this sector.
• There is a growing awareness of security and privacy concerns, with the proliferation of embedded AI in various devices. Addressing these issues is becoming a priority to ensure the safe and responsible deployment of embedded AI technologies.

Attributes	Key Insights
Embedded AI Market Estimated Size in 2024	USD 9.5 billion
Projected Market Value in 2034	USD 36.2 billion
Value-based CAGR from 2024 to 2034	14.3%

2019 to 2023 Historical Analysis vs. 2024 to 2034 Market Forecast Projections

The scope for embedded AI rose at a 17.8% CAGR between 2019 and 2023. The global market for embedded AI is anticipated to grow at a moderate CAGR of 14.3% over the forecast period 2024 to 2034.

The market experienced steady growth during the historical period from 2019 to 2023, owing to continued growth in IoT adoption, which led to increased demand for embedded AI in devices.

• Continued advancements in AI hardware, including GPUs, TPUs, and AI accelerators, played a significant role in enhancing the performance and efficiency of embedded AI solutions.
• Embedded AI applications in smart cities, including video surveillance and analytics, were on the rise. Governments and businesses increasingly explored AI solutions to enhance security and optimize urban services.
• The healthcare sector saw continued adoption of embedded AI for applications such as medical imaging, diagnostics, and personalized medicine. The role of AI in improving patient outcomes and optimizing healthcare processes contributed to market growth.

Looking ahead to the forecast period from 2024 to 2034, the market is expected to witness significant growth. Ongoing developments in AI algorithms, especially those optimized for edge computing, are expected to enhance the capabilities of embedded AI solutions. Improved algorithms will contribute to better performance and efficiency.

• The integration of embedded AI in robotics, drones, and autonomous systems is expected to grow. Industries such as manufacturing, logistics, and agriculture may see increased use of AI driven automation.
• The rollout and expansion of 5G networks will likely facilitate faster and more reliable connectivity, supporting real time communication for embedded AI applications, which is particularly relevant for applications that require low latency.
• Embedded AI is likely to find applications across a broader range of industries, including retail, energy, and finance. The adoption of embedded AI solutions may diversify, As industries recognize the potential benefits of AI.

Embedded AI Market Key Drivers

Embedded AI is closely tied to edge computing, where processing is done closer to the source of data rather than relying on centralized cloud servers, which is particularly important for applications that require low latency, such as autonomous vehicles, IoT devices, and robotics.

• The growth of the Internet of Things has led to an increased demand for embedded AI in devices ranging from smart home appliances to industrial sensors. The devices often benefit from on device AI processing for quicker decision making and reduced dependence on cloud resources.
• Ongoing advancements in AI hardware, including specialized processors such as Graphics Processing Units and Tensor Processing Units, enable more efficient and powerful embedded AI solutions. The developments enhance the performance and capabilities of devices with embedded AI.
• Continuous improvement in AI algorithms, particularly those designed for edge computing, contributes to the effectiveness of embedded AI applications. Optimized algorithms allow for more efficient use of computational resources and better performance on resource constrained devices.

Challenges in the Embedded AI Market

The integration of AI in embedded systems often involves the processing and analysis of sensitive data. Concerns related to data privacy and security can hinder adoption, especially in industries where safeguarding personal or confidential information is critical.

• The absence of standardized protocols and frameworks for embedded AI development can lead to compatibility issues and interoperability challenges. Standardization is crucial for ensuring seamless integration and collaboration across different devices and platforms.
• Developing and implementing embedded AI solutions can be expensive, particularly for small and medium sized enterprises or startups. The high upfront costs for hardware, software, and skilled personnel may act as a barrier to entry for some businesses.
• Many embedded devices have limited computational resources, such as processing power and memory. Implementing sophisticated AI algorithms on resource constrained devices can be challenging, impacting the performance and efficiency of embedded AI applications.

Country-wise Insights

The below table showcases revenues in terms of the top 5 leading countries, spearheaded by the United Kingdom and Korea. The countries are expected to lead the market through 2034.

Countries	Forecast CAGRs from 2024 to 2034
The United States	14.5%
China	14.8%
The United Kingdom	15.4%
Japan	14.9%
Korea	15.1%

Adoption in Key Industries Driving the Market in the United States

The embedded AI market in the United States expected to expand at a CAGR of 14.5% through 2034. The United States has a strong presence in industries such as technology, finance, healthcare, manufacturing, and automotive. The adoption of embedded AI in these key sectors, driven by the need for innovation and efficiency, contributes to market growth.

• The country is at the forefront of technological advancements. Ongoing developments in AI algorithms, hardware, and software contribute to the growth of embedded AI solutions. Companies in the United States are actively involved in pushing the boundaries of what embedded AI can achieve.
• The widespread deployment of Internet of Things devices in the country creates a favorable environment for embedded AI. Embedded AI solutions are essential for processing and deriving valuable insights from this data, as IoT devices generate vast amounts of data.

Digital Transformation Initiatives to Accelerate Market Growth in the United Kingdom

The embedded AI market in the United Kingdom is anticipated to expand at a CAGR of 15.4% through 2034. The United Kingdom has been actively pursuing digital transformation across various industries. Embedded AI is a key enabler of digitalization efforts, providing intelligent solutions for automation, data analytics, and enhanced decision making.

• Supportive government policies, funding, and initiatives for AI research and development contribute to the growth of the Embedded AI market. The government of the country has shown a commitment to fostering innovation and technological advancements in the AI sector.
• The United Kingdom boasts a strong pool of AI talent, including researchers, data scientists, and engineers. The availability of skilled professionals accelerates the development and deployment of embedded AI solutions in the country.

Advancements in Manufacturing and Industry 4.0 Spearhead the Market in China

Embedded AI trends in China are taking a turn for the better. A 14.8% CAGR is forecast for the country from 2024 to 2034. Rapid urbanization in the country has led to the development of smart cities, where embedded AI plays a crucial role in applications such as urban management, transportation optimization, and environmental monitoring.

• The manufacturing sector in China is embracing Industry 4.0 practices, and embedded AI is a key component in smart manufacturing. Applications include predictive maintenance, quality control, and process optimization.
• The country has a thriving consumer electronics market with a high demand for smart devices. Embedded AI is incorporated into products such as smartphones, smart TVs, and wearables, enhancing their capabilities and functionalities.

Advanced Robotics and Automation Fueling the Market in Japan

The embedded AI market in Japan is poised to expand at a CAGR of 14.9% through 2034. Japan is a global leader in robotics and automation. Embedded AI is integrated into robotic systems for tasks such as image recognition, object manipulation, and decision making, contributing to the growth of the market.

• The healthcare sector in Japan is actively adopting AI technologies, including embedded AI, for applications such as medical imaging, diagnostics, and personalized medicine. The technologies contribute to improving healthcare outcomes.
• Japan is adopting embedded AI for threat detection, anomaly detection, and secure authentication, with the growing importance of cybersecurity. AI driven cybersecurity solutions are crucial for protecting digital assets.

Telecommunication and 5G Infrastructure Driving the Demand in Korea

The embedded AI market in Korea is anticipated to expand at a CAGR of 15.1% through 2034. The country is a leader in 5G technology, and the deployment of 5G infrastructure facilitates the growth of embedded AI applications. High speed and low latency connections enable advanced AI processing at the edge.

• The automotive industry in Korea integrates embedded AI for advancements in connected vehicles, autonomous driving, and in vehicle AI applications. The pursuit of innovation in automotive technologies contributes to the growth of the market.
• The growing interest in edge computing solutions in Korea drives the adoption of embedded AI. Edge computing enhances real time processing capabilities, making it essential for various applications, from IoT to industrial automation.

Category-wise Insights

The below table highlights how BFSI segment is projected to lead the market in terms of vertical, and is expected to account for a CAGR of 14.1% through 2034.

Based on data type, the numeric data segment is expected to account for a CAGR of 13.8% through 2034.

Category	CAGR through 2034
BFSI	14.1%
Numeric Data	13.8%

BFSI Claims High Demand for Embedded AI

Based on vertical, the BFSI segment is expected to continue dominating the Embedded AI market. Embedded AI systems are crucial for enhancing fraud detection and prevention capabilities in the BFSI sector. Machine learning algorithms can analyze patterns, detect anomalies, and identify potentially fraudulent transactions in real time, improving the security of financial transactions.

• AI powered embedded systems contribute to advanced risk management strategies. The systems can analyze vast amounts of financial data to assess and mitigate risks, providing financial institutions with more accurate risk assessments and helping them make informed decisions.
• Embedded AI enables the implementation of virtual assistants, chatbots, and personalized customer experiences in the BFSI sector. The systems can provide 24/7 customer support, answer queries, and offer personalized financial advice, enhancing customer engagement and satisfaction.

Numeric Data Segment to Hold High Demand for Embedded AI

In terms of data type, the numeric data segment is expected to continue dominating the Embedded AI market. The proliferation of IoT sensors and devices that generate numeric data is a key driver. Embedded AI is used to analyze and derive insights from the vast amounts of numeric data generated by sensors in applications like smart cities, industrial IoT, and healthcare.

• Numeric data from sensors monitoring equipment conditions is crucial for predictive maintenance applications. Embedded AI analyzes this numeric data to predict potential failures, schedule maintenance proactively, and minimize downtime in various industries.
• In manufacturing and production environments, embedded AI processes numeric data from sensors and cameras to perform quality control and inspection, which ensures the consistency and quality of products through the analysis of numerical measurements.

Competitive Landscape

The embedded AI market is characterized by intense competition and dynamic innovation as companies strive to harness the power of artificial intelligence within embedded systems. Various players, ranging from established technology giants to innovative startups, contribute to the competitive ecosystem.

Recent Development

• In 2023, Arrow Electronics, Inc. and Qualcomm Technologies International, Ltd. recently expanded their strategic collaboration. The collaboration has led to the establishment of Edge Labs, a designated Arrow Center of Excellence.
• The CoE, known as Edge Labs, is set to play a crucial role in assisting customers in accelerating the development of connected intelligent edge devices. The devices will be based on innovative solutions provided by Qualcomm Technologies.

Report Scope

Attribute	Details
Estimated Market Size in 2024	USD 9.5 billion
Projected Market Valuation in 2034	USD 36.2 billion
Value-based CAGR 2024 to 2034	14.3%
Forecast Period	2024 to 2034
Historical Data Available for	2019 to 2023
Market Analysis	Value in USD billion
Key Regions Covered	North America; Latin America; Western Europe; Eastern Europe; South Asia and Pacific; East Asia; The Middle East & Africa
Key Market Segments Covered	Vertical, Data Type, Offering, Region
Key Countries Profiled	The United States, Canada, Brazil, Mexico, Germany, France, France, Spain, Italy, Russia, Poland, Czech Republic, Romania, India, Bangladesh, Australia, New Zealand, China, Japan, South Korea, GCC countries, South Africa, Israel
Key Companies Profiled	Google LLC (Alphabet Inc.); IBM Corporation; Microsoft Corporation; Amazon Web Services Inc. (Amazon.com Inc.); NVIDIA Corporation; Intel Corporation; Qualcomm, Inc.; Salesforce Inc.; Siemens AG; Oracle Corporation

Table of Content

• 1. Executive Summary
• 2. Market Overview
• 3. Market Background
• 4. Global Market Analysis 2019 to 2023 and Forecast, 2024 to 2034
• 5. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Vertical
  • 5.1. BFSI
  • 5.2. Healthcare & Lifesciences
  • 5.3. IT & Telecom
  • 5.4. Automotive
  • 5.5. Media & Entertainment
  • 5.6. Energy & Power
  • 5.7. Transportation & Logistics
  • 5.8. Government & Defense
  • 5.9. Manufacturing
  • 5.10. Others
• 6. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Data Type
  • 6.1. Numeric Data
  • 6.2. Sensor Data
  • 6.3. Image & Video Data
  • 6.4. Categorical Data
  • 6.5. Others
• 7. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Offering
  • 7.1. Hardware
    • 7.1.1. Processors
    • 7.1.2. Memory
    • 7.1.3. AI Accelerators
    • 7.1.4. Others
  • 7.2. Software
    • 7.2.1. Edge Computing Platforms
    • 7.2.2. AI & ML Framework
    • 7.2.3. AI Middleware & Others
  • 7.3. Services
• 8. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Region
  • 8.1. North America
  • 8.2. Latin America
  • 8.3. Western Europe
  • 8.4. Eastern Europe
  • 8.5. South Asia and Pacific
  • 8.6. East Asia
  • 8.7. Middle East and Africa
• 9. North America Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 10. Latin America Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 11. Western Europe Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 12. Eastern Europe Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 13. South Asia and Pacific Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 14. East Asia Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 15. Middle East and Africa Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 16. Key Countries Market Analysis
• 17. Market Structure Analysis
• 18. Competition Analysis
  • 18.1. Google LLC (Alphabet Inc.)
  • 18.2. IBM Corporation
  • 18.3. Microsoft Corporation
  • 18.4. Amazon Web Services, Inc. (Amazon.com, Inc.)
  • 18.5. NVIDIA Corporation
  • 18.6. Intel Corporation
  • 18.7. Qualcomm, Inc.
  • 18.8. Salesforce, Inc.
  • 18.9. Siemens AG
  • 18.10. Oracle Corporation
• 19. Assumptions & Acronyms Used
• 20. Research Methodology