Artificial Intelligence (AI) Chip Market

Artificial Intelligence (AI) Chip Market Size Survey Report – In a Glance

As per the survey report on Global Artificial Intelligence (AI) Chip market, the market is projected to foresee a CAGR of 29.3% between 2025-2035, and further generate a market size of USD 836.9 billion revenue by the end of 2035. In the year 2025, the market size was valued at USD 82.7 billion revenue.

• The global Artificial Intelligence (AI) Chip market is projected to grow on account of the increased adoption of AI across industries and growth in the demand for real-time data processing and IoT integration.
• In Japan, the Artificial Intelligence (AI) Chip market growth can be attributed to the widespread adoption of cloud computing, big data analytics and IoT, leading to a surge in the demand for high-performance AI-driven solutions.
• KDMI analyst’s growth analysis foresees complexity of the development of AI chip high costs involved to pose a challenge to the market growth.
• North America, having the highest market share in the Artificial Intelligence (AI) Chip market, is projected to dominate the global market.

Artificial Intelligence (AI) Chip Market Analysis

An Artificial Intelligence (AI) Chip is a computer microchip that is used in the development of AI systems. AI chips differ from other chips as it is specifically built to handle tasks related to AI, such as machine learning (ML), data analysis and natural language processing (NLP). It is a rapidly growing market with a forecasted growth rate of 20% of the total chip market by the end of the year 2025.  These chips harness parallel processing abilities, optimized memory structures and unique neural network architectures to achieve remarkable performance compared to a general-purpose processor NVIDIA Corporation, Advanced Micro Devices, Inc., Intel Corporation, Micron Technology, Inc., Google, are some of the significant parties in the global market for Artificial Intelligence (AI) Chip.

Analyst’s Observation on Japan Artificial Intelligence (AI) Chip Market Survey 

The Japan Artificial Intelligence (AI) Chip market is driven primarily by the presence of an aggressive expansion of data centre infrastructure. With the widespread adoption of cloud computing, big data analytics and IoT, there is a surge in the demand for high-performance AI-driven solutions. The focus of Japan on smart manufacturing, digital transformation and autonomous technologies further fuel this demand. In the fiscal year 2023, the Japanese government allocated roughly JPY2 trillion (approximately $13 billion) to strengthen the domestic production system of semiconductors. With this support from government and the rise in the adoption of AI, Artificial Intelligence (AI) chips market is experiencing a rapid growth.

Artificial Intelligence (AI) Chip Market Growth Drivers and Challenges 

Growth Drivers

• Increased Adoption of AI Across Industries:

A major driver for AI chips market is the rise in the adoption of artificial intelligence across industries. In a report, it was stated that 77% of companies are indulging with the use of AI in their businesses, and 83% of companies claim that AI play a necessary role in their business plans. Sectors like automotive, healthcare, and finance are increasingly integrating AI to help enhance automation, and operational efficiency in their respective fields. High-performance AI chips help with all these functions and enables an efficient and smooth functioning with advanced technology incorporation. As AI embeds more within the industrial process, the requirement for such chips increase to offer fast-processing, lower latency, and improved energy efficiency. This trend in the investment in artificial intelligence is leading the growth of AI chips market.

• Growth in the Demand for Real-Time Data Processing and IoT Integration:

The rise in demand for real-time processing is a key driver for the AI chip market. Various applications like smart infrastructure, autonomous vehicles, and industrial automation require real-time analysis and response that only AI chips can provide. With the expansion of IoT ecosystems, there is an increase in the generation of massive volumes of data from the connected devices which leads to a rise in the demand for AI chips that can process the data efficiently. AI chips allow for quick decision-making and an improved response system, making them a necessity in the emerging technologies. This growth in dependency on high-performance AI chips is fuelling the expansion of the market. 

Restraints

• Complexity of the Development of AI Chip Design and Manufacturing:

The designing and manufacturing process of AI chips is intricate and resource-intensive. The development of these chips requires highly specialized architectures, advanced materials, and precise engineering that may not be required in the development of traditional chips. The complex nature of this process requires a significant investment in research and development, and access to cutting-edge fabrication facilities, which only a few companies have the capability to manage, creating high entry barriers. This challenge may lead to slowing down the development process of these chips and limit the number of available suppliers, restricting the market expansion.

• High Costs Involved in the Development Process and Possible Environmental Threats:

The entire development process is complex and leads to a high cost of production due to the investment required in R&D and various other factors. The advanced functionality of the chips requires sophisticated manufacturing equipment and complex system of integration, therefore elevating the cost. For small or medium enterprises this may limit their ability to adopt such technology, limiting the widespread adoption of the chips and restricting market expansion. Additionally, the entire production process involves a significant consumption of energy which may contribute to the carbon emissions and cause environmental degradation. These factors can contribute to limiting market growth and expansion if not addressed properly.

Artificial Intelligence (AI) Chip Market Segmentation

Our experts at KD Market Insights have segmented the global Artificial Intelligence (AI) Chip market research report as:

Artificial Intelligence (AI) Chip Market Regional Synopsis

North America holds a dominant position in this market, generating approximately $100 billion per year in revenues. The AI chip market of the region is driven by a strong technological ecosystem and concentration of hyperscale cloud providers and data centres. Further acceleration in the demand of the market is fuelled due to the robust venture capital funding and collaboration between various tech firms, universities, and federal research labs, allowing the market to emerge as a dominating region in the market growth.

The Asia-Pacific AI chip market is a fast-paced market led by the strong manufacturing capabilities in countries like China, Taiwan, and South Korea. Various government initiatives further boost the market expanding the scope for growth and rise in adoption of AI powered devices in the region.

The market expansion of the Europe market is due to the rise in adoption of recent tech and rapid indulgence with artificial intelligence. In addition, government initiatives enable the promotion of AI in smart manufacturing, further boosting the demand for these chips in various devices and their implementation across the region.

Latin America market, with a strong influence of innovation and advancement in technology, is witnessing a surging demand in the AI chip market. With an increase in the development of devices integrating the use of the AI chips, makes the use of such chips popular among the consumers driving the demand. Middle East and Africa are also experiencing rapid growth due to high revenues funding the development of smart data centres and AI powered systems.

As per our analysts at KD Market Insights, the following five players lead the North America Artificial Intelligence (AI) Chip market growth:

• Nvidia Corporation
• Intel Corporation
• Advanced Micro Devices (AMD)
• Qualcomm Incorporated
• Alphabet Inc. (Google)

Artificial Intelligence (AI) Chip Market Competitive Landscape

Some of the key players who top the global Artificial Intelligence (AI) Chip market share:

• NVIDIA Corporation
• Advanced Micro Devices, Inc.
• Intel Corporation
• Micron Technology, Inc.
• Google
• SK HYNIX INC.
• Qualcomm Technologies, Inc.
• Samsung
• Huawei Technologies Co., Ltd.
• Apple Inc.
• Imagination Technologies
• Graphcore
• Cerebras

1. Executive Summary
   1. Market Overview
   2. Key Findings
   3. Market Trends
   4. Market Outlook
2. Introduction
   1. Scope of the Report
   2. Research Methodology
   3. Definitions and Assumptions
   4. Acronyms and Abbreviations
3. Market Dynamics
   1. Drivers
   2. Restraints
   3. Opportunities
   4. Challenges
4. Global Artificial Intelligence (AI) Chip Market
   1. Market Overview
   2. Market Size and Forecast
   3. Market Segmentation
      1. By Chipset type
      2. By Architecture type
      3. By Processing type
      4. By Region
5. Market Segmentation by Chipset type
   1. CPU
   2. GPU
   3. FPGA
   4. ASIC
   5. Others
6. Market Segmentation by Architecture type
   1. System On Chip (SoC)
   2. System in Package
   3. Multi Chip Module
   4. Others
7. Market Segmentation by Processing type
   1. Edge
   2. Cloud
8. Regional Analysis
   1. North America
      1. United States
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      2. Canada
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      3. Mexico
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
   2. Europe
      1. United Kingdom
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      2. Germany
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      3. France
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      4. Italy
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      5. Spain
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      6. Rest of Europe
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
   3. Asia Pacific
      1. China
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      2. Japan
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      3. India
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      4. Australia
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
         4. South Korea
         5. Market Size and Forecast
         6. Key Trends and Developments
         7. Market Analysis by Chipset type, Architecture type, and Processing type
      5. Rest of Asia Pacific
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
   4. Latin America
      1. Brazil
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      2. Argentina
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      3. Colombia
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      4. Rest of Latin America
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
   5. Middle East & Africa
      1. South Africa
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      2. Saudi Arabia
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      3. UAE
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
      4. Rest of Middle East & Africa
         1. Market Size and Forecast
         2. Key Trends and Developments
         3. Market Analysis by Chipset type, Architecture type, and Processing type
9. Competitive Landscape
   1. Market Share Analysis
   2. Company Profiles
      1. NVIDIA Corporation
      2. Advanced Micro Devices, Inc.
      3. Intel Corporation
      4. Micron Technology, Inc.
      5. Google
      6. SK HYNIX INC.
      7. Qualcomm Technologies, Inc.
      8. Samsung
      9. Huawei Technologies Co., Ltd.
      10. Apple Inc.
      11. Imagination Technologies
      12. Graphcore
      13. Cerebras
      14. Others
10. Strategic Recommendations
11. Appendix
    1. List of Tables
    2. List of Figures
12. References