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Saturday, Jun 15, 2024
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.

AI and Autonomy

Artificial intelligence chip market projected to grow exponentially, per report

The Brainy Insights predicts compound annual growth greater than 38 per cent

Artificial intelligence chip market projected to grow exponentially: report
NVIDIA, one of the key market players, just unveiled its GeForce RTX SUPER GPU. The GPU segment held a 31.25 per cent share in the AI chip market in 2022. Image credit: NVIDIA

The market for artificial intelligence chips is set to grow immensely in the coming years, according to a report published this month by The Brainy Insights.

The Indian researcher says the market will be worth US$372 billion by 2032, ascending from its current value of approximately US$20 billion at a considerable compound annual growth rate of 38.1 per cent.

A rising demand for AI applications and their data management capabilities, particularly in healthcare and retail, will be the primary driver of its growth. The emerging demand for quantum computing is another factor propelling market expansion.

“Developing AI chips that can leverage the capabilities of quantum computing for enhanced processing power and solving complex AI problems represents a potential future opportunity,” the market researcher says.

The demand for energy-efficient or “Green AI” chips with a low rate of power consumption should rise as well due to the popularity of sustainable technologies.

Advancements in natural language processing enabled by the development of large language models will propel demand for specialized AI chips.

AI chips with cybersecurity applications are expected to gain popularity in the coming years too. Many governments and leading companies throughout the world are investing heavily in AI research and technologies.

Read more: Artificial intelligence proven to help in cancer screening

Read more: Google launches its most advanced AI platform: Gemini

China and India are top contributors to market development

The Brainy Insights says the Asia Pacific region is expected to see the most substantial market growth during the next eight years.

It attributes this to increasing urbanization and an expanding middle class, particularly in China and India.

The Indian data firm Yotta’s recently agreed to spend US$1 billion on AI chips from NVIDIA Corp. (NASDAQ: NVDA). 

The market researcher says governments in the region now recognize the importance of AI technologies and their implications for the economy.

Policies and initiatives to support AI research in nations within the region will propel growth. The emergence of tech companies in a continually developing technology sector will propel the market as well.

Industries adopting artificial intelligence in the Asia Pacific region include manufacturing, telecommunications, healthcare and finance.

Other regions analyzed in the report include North America, Europe, South America, Africa and the Middle East.

Edge and cloud computing segment dominated in 2022

The report cites data from 2022 and the edge and cloud computing segment of the market had the largest share by far that year at 74.8 per cent. It generated revenue of approximately US$11 billion, globally.

The system-on-chip segment came in second with a 37.3 per cent market share. “The technology segment is classified into system on chip, system in package, multi-chip module and others,” The Brainy Insights said. It generated about US$5.5 billion that year.

The central processing unit (CPU) segment took third place with a 31.25 per cent market share and revenue of approximately US$4.6 billion. The segment is divided into the application-specific integrated circuit (ASIC), CPU, graphics processing unit (GPU) and field programmable gate array (FPGA) niches.

Read more: Experimental robot glove for stroke patients receives £435k funding from UK government

Read more: Coca-Cola releases limited edition ‘Futuristic’ flavoured soda created with AI

Key market players include world’s top tech companies

The top market players referenced in the report include major tech influences like Amazon (NASDAQ: AMZN), Toshiba (TYO: 6502) (OTCMKTS: TOSYY), NVIDIA, Microsoft (NASDAQ: MSFT) and Alphabet Inc Class A (Google) (NASDAQ: GOOGL). 

Google recently launched its most advanced artificial intelligence platform, Gemini. The platform received significant criticism from the tech community for posting a video online misrepresenting its capabilities. “Not a good look for Google,” a host from The Canadian Investor podcast said.

Advanced Micro Devices, Inc. (NASDAQ: AMD), the semiconductor manufacturer Xilinx, California’s software company Groq and Toronto’s AI technology company Tenstorrent are some of the less renowned players listed by The Brainy Insights.

A limited skilled workforce knowledgeable about AI chips is a challenge the market will face in the years to come. Data security and privacy issues are also a top concern. The data stored on AI chips can potentially contain highly sensitive information.

The Brainy Insights charges a single user US$4,700 for access to the data in the full report and corporate users have to pay US$8,499.


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