UBS Group AG: The AI industry is expected to reach a scale of $225 billion by 2027, with software and chip industries benefiting the most.
With the increasing demand for AI applications in various industries, UBS believes that the AI industry will reach a scale of $225 billion by 2027. The software and chip sectors will experience rapid expansion, and AI technology will be the most important "technology theme" in the next decade.
AI, leading the "technology theme" of the next decade, the AI industry is expected to reach $225 billion by 2027, with rapid expansion in software and chip sectors.
On Tuesday, January 2nd, UBS Group AG released a report predicting the growth of the AI industry:
The market size of the AI industry is projected to soar from $2.2 billion in 2022 to $225 billion in 2027, with a compound annual growth rate of 152%.
AI industry revenue is expected to increase from $18 billion in 2022 to $420 billion in 2027, a nearly 15-fold increase (the latest forecast has been revised up by 40% compared to previous estimates, as UBS Group AG analysts admit they were too conservative);
The compound annual growth rate of AI software applications is projected to be 138%.
The market size of AI infrastructure is expected to grow from $25.8 billion in 2022 to $195 billion in 2027.
In 2024, the biggest beneficiaries will be hardware chips and GPUs that are essential for AI training and operation. It is estimated that these companies in the industry will experience a tenfold increase in revenue, surging from $15.8 billion to $165 billion.
The AI industry is currently in its early stages of rapid development. In the future, AI will become one of the fastest-growing and largest segments in the global technology industry, and it is the most important "technology theme" of today and the next decade. AI has its unique growth trajectory in the technology field, with no other segment showing a similar growth profile as AI.
UBS Group AG compares the release of ChatGPT applications to the "iPhone moment" of the AI industry, marking a significant turning point in the widespread application and popularization of AI technology. The various applications and features launched by OpenAI in the fourth quarter of 2023 are seen as the "App Store moment" of the AI industry, similar to how Apple's App Store provides a broad platform for smartphone applications.
Furthermore, regarding the AI regulation issue that investors are highly concerned about, UBS Group AG mentioned that regulation is a risk but not an obstacle. Early-stage regulation can provide clear frameworks and guidance during the early development of technology, which is more preferable compared to imposing restrictions in the later stages of industry maturity. Additionally, excessive market reactions, such as stock price declines, caused by geopolitical or regulatory reasons may create attractive buying opportunities.