International Data Corporation recently published new forecasts for the European AI market, with the industry predicted to notch up a 25.5% CAGR from 2022 - 2026.
The upshot is that despite market anxieties and widespread lay-offs, the industry could be worth $191 billion in turnover by the end of the forecast period.
IDC says the growth spurt will mainly be supported by AI-centric software, predicted by the forecast data to experience 32.4% CAGR, followed by non-AI-centric software with 16.7% CAGR and AI hardware with 15.2% CAGR.
It appears the economic outlook will affect AI hardware infrastructure growth, with this segment predicted to lag general-purpose hardware in the reporting period.
Nevertheless, IDC believes AI servers and storage in Europe will "show a slow but steady growth pattern" until the end of the recession.
Enterprise demand for emerging AI technologies was seen continuing its ascent, for instance, analytics-driven by computer vision, natural language processing, and AI-driven process automation.
Martin Nuska, IDC senior research manager, surmised the hypothesis as being indicative of a critical inflexion point for commercial AI software adoption over the next five years.
"Many companies and governments are now investing more to make their processes more agile, efficient, and resilient,” Nuska added.
"Europe faces a potential recession, while the labour market is marked by contradictory forces — a shortage of skilled workers in certain tech areas on one hand, while on the other even the biggest tech companies like Amazon, Google, and Microsoft are laying off tens of thousands of workers.
"We expect the AI market to continue performing strongly nevertheless, because of the technology’s potential for long-term cost optimization and as a possible solution to the skills gap.”