The global artificial intelligence market could generate USD 6 trillion in annual revenue by 2031 as businesses and technology companies seek to fund rapidly rising demand for AI computing, according to Bain & Company’s seventh annual Global Technology Report.
The report said much of the value will need to come from innovation beyond productivity gains, as existing AI applications alone may not generate enough revenue to support the scale of infrastructure investment underway.
Bain estimates that existing consumer and enterprise AI applications could generate between USD 1.2 trillion and USD 1.8 trillion in revenue.
Consumer AI revenue is expected to come through subscriptions and advertising, while enterprise applications include software development, sales, marketing, customer service, and IT operations.
The remaining USD 4.2 trillion would need to come from new categories and innovation. Bain identified four areas that could contribute to this growth.
These include AI model providers replacing search engines and integrating advertising, autonomous systems for automobiles, trucks, drones and industrial automation, and physical AI involving simulations, digital twins and robotics.
New products and uses that do not exist today could also create markets around areas such as drug discovery, mental health and energy generation.
The surge in AI computing demand has also strengthened the hardware and semiconductor industry. Bain said hardware and semiconductor stocks grew at a 24% compound annual rate between 2020 and 2026, compared with 6% for software.
High-bandwidth memory, advanced packaging and custom silicon are among the fastest-growing segments, with application-specific integrated circuits also expanding rapidly.
The report warned that rising demand for high-bandwidth memory could contribute to shortages in other memory categories and potentially raise smartphone and PC prices.
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Bain also highlighted cybersecurity risks linked to AI’s rapid adoption. The report found that AI has compressed the time required for a typical cyberattack from about four weeks to approximately 18 hours.
At the same time, Bain said the speed at which companies adopt AI and put it into practical use has become a new competitive variable.
The report noted that leading AI labs are investing more than USD 9.75 billion in forward-deployed engineering models to help companies integrate AI more quickly.