Global Explainable AI Market Size study & Forecast, by Component, Deployment, Application (Fraud & Anomaly Detection, Drug Discovery & Diagnostics, Predictive Maintenance), End Use and Regional Forecasts 2025-2035

Description

The Global Explainable AI Market is valued approximately at USD 7.79 billion in 2024 and is projected to expand at a remarkable CAGR of 18.00% over the forecast period 2025-2035. Explainable Artificial Intelligence (XAI) is a subset of AI systems designed to provide human-understandable reasoning behind machine-generated decisions. Unlike traditional AI "black box" models, XAI enhances transparency, accountability, and trust by allowing users to understand how predictions and recommendations are derived. With industries across healthcare, finance, and government increasingly dependent on AI-driven decisions, the call for explainability has intensified, particularly as businesses confront rising regulatory scrutiny, ethical considerations, and reputational risks. The market growth is also fueled by the necessity to adopt interpretable models to bridge the gap between AI sophistication and stakeholder trust.

The surging deployment of AI in high-stakes decision-making has amplified demand for explainable frameworks that can justify algorithmic choices in real time. Whether it is diagnosing rare diseases, preventing fraud, or optimizing predictive maintenance, organizations are compelled to adopt XAI solutions to avoid regulatory pushbacks and mitigate operational risks. For instance, the financial sector is leveraging explainable models to comply with global transparency norms such as the EU's General Data Protection Regulation (GDPR). Simultaneously, healthcare providers are accelerating investments in interpretable AI for diagnostics and drug discovery, ensuring clinicians can trust automated recommendations. However, while the scalability of opaque deep learning models often outpaces XAI frameworks, rapid innovations in hybrid modeling and natural language explanations are closing this gap and unlocking lucrative opportunities through the next decade.

The detailed segments and sub-segments included in the report are:

By Component:

Software
Services

By Deployment:

Cloud
On-Premises

By Application:

Fraud & Anomaly Detection
Drug Discovery & Diagnostics
Predictive Maintenance

By End Use:

BFSI
Healthcare & Life Sciences
Government & Defense
Manufacturing
Telecom & IT
Retail & E-commerce
Energy & Utilities
Others
On the application front, Fraud & Anomaly Detection is expected to dominate the Explainable AI market over the forecast period. This dominance is underpinned by the growing vulnerability of digital platforms to fraudulent activities and cyberattacks. Financial institutions, e-commerce providers, and telecom operators are increasingly embedding XAI into fraud prevention systems to not only detect anomalies but also explain why transactions are flagged, thereby ensuring compliance and bolstering customer trust. With cybercrime evolving in sophistication, enterprises seek explainability as a strategic asset to meet both regulatory requirements and stakeholder assurance.
From a revenue perspective, Healthcare & Life Sciences currently lead the market's contribution. The sector is at the forefront of adopting XAI to interpret AI-driven diagnostic results, accelerate drug discovery pipelines, and support personalized treatment recommendations. The ability of XAI to provide clinicians with transparent reasoning behind predictive outcomes is revolutionizing patient trust in AI systems. At the same time, regulatory bodies are mandating interpretable AI to safeguard patient safety and ethical compliance, giving healthcare a distinct edge in revenue share. Parallelly, BFSI and Government sectors are rapidly catching up, owing to their demand for traceability and risk management.
Across geographies, North America commanded the lion's share of the Explainable AI market in 2025, underpinned by strong technology adoption, a robust ecosystem of AI innovators, and regulatory frameworks encouraging transparency in automated decision-making. The United States, in particular, has spearheaded the deployment of XAI in financial compliance, defense operations, and precision healthcare. Meanwhile, Asia Pacific is emerging as the fastest-growing regional market, driven by large-scale AI adoption in countries like China, India, and Japan, coupled with exponential digitalization and government-backed AI initiatives. Europe, with its stringent data privacy and AI ethics regulations, remains a critical player, whereas Latin America and the Middle East are steadily unlocking opportunities through investments in smart governance and digital transformation.

Major market players included in this report are:

IBM Corporation
Google LLC (Alphabet Inc.)
Microsoft Corporation
SAS Institute Inc.
Amazon Web Services, Inc. (AWS)
NVIDIA Corporation
Xilinx, Inc.
Fico, Inc.
Intel Corporation
Datasiku Inc.
Accenture Plc
Schneider Electric SE
Siemens AG
Cisco Systems, Inc.
Oracle Corporation

Global Explainable AI Market Report Scope:

Historical Data - 2023, 2024
Base Year for Estimation - 2024
Forecast period - 2025-2035
Report Coverage - Revenue forecast, Company Ranking, Competitive Landscape, Growth factors, and Trends
Regional Scope - North America; Europe; Asia Pacific; Latin America; Middle East & Africa
Customization Scope - Free report customization (equivalent to up to 8 analysts' working hours) with purchase. Addition or alteration to country, regional & segment scope*

The objective of the study is to define market sizes of different segments & countries in recent years and to forecast the values for the coming years. The report is designed to incorporate both qualitative and quantitative aspects of the industry within the countries involved in the study. The report also provides detailed information about crucial aspects, such as driving factors and challenges, which will define the future growth of the market. Additionally, it incorporates potential opportunities in micro-markets for stakeholders to invest, along with a detailed analysis of the competitive landscape and product offerings of key players. The detailed segments and sub-segments of the market are explained below:

Key Takeaways:

Market Estimates & Forecast for 10 years from 2025 to 2035.
Annualized revenues and regional-level analysis for each market segment.
Detailed analysis of the geographical landscape with country-level analysis of major regions.
Competitive landscape with information on major players in the market.
Analysis of key business strategies and recommendations on future market approach.
Analysis of the competitive structure of the market.
Demand side and supply side analysis of the market.

Chapter 1. Global Explainable AI Market Report Scope & Methodology

1.1. Research Objective
1.2. Research Methodology
- 1.2.1. Forecast Model
- 1.2.2. Desk Research
- 1.2.3. Top Down and Bottom-Up Approach
1.3. Research Attributes
1.4. Scope of the Study
- 1.4.1. Market Definition
- 1.4.2. Market Segmentation
1.5. Research Assumption
- 1.5.1. Inclusion & Exclusion
- 1.5.2. Limitations
- 1.5.3. Years Considered for the Study

Chapter 2. Executive Summary

2.1. CEO/CXO Standpoint
2.2. Strategic Insights
2.3. ESG Analysis
2.4. key Findings

Chapter 3. Global Explainable AI Market Forces Analysis

3.1. Market Forces Shaping The Global Explainable AI Market (2024-2035)
3.2. Drivers
- 3.2.1. Necessity to adopt interpretable models
- 3.2.2. Surging deployment of AI in high-stakes decision-making
3.3. Restraints
- 3.3.1. Scalability of opaque deep learning models
3.4. Opportunities
- 3.4.1. Rapid innovations in hybrid modeling and natural language

Chapter 4. Global Explainable AI Industry Analysis

4.1. Porter's 5 Forces Model
- 4.1.1. Bargaining Power of Buyer
- 4.1.2. Bargaining Power of Supplier
- 4.1.3. Threat of New Entrants
- 4.1.4. Threat of Substitutes
- 4.1.5. Competitive Rivalry
4.2. Porter's 5 Force Forecast Model (2024-2035)
4.3. PESTEL Analysis
- 4.3.1. Political
- 4.3.2. Economical
- 4.3.3. Social
- 4.3.4. Technological
- 4.3.5. Environmental
- 4.3.6. Legal
4.4. Top Investment Opportunities
4.5. Top Winning Strategies (2025)
4.6. Market Share Analysis (2024-2025)
4.7. Global Pricing Analysis And Trends 2025
4.8. Analyst Recommendation & Conclusion

Chapter 5. Global Explainable AI Market Size & Forecasts by Component 2025-2035

5.1. Market Overview
5.2. Global Growth Hormone Deficiency Market Performance - Potential Analysis (2025)
5.3. Software
- 5.3.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 5.3.2. Market size analysis, by region, 2025-2035
5.4. Services
- 5.4.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 5.4.2. Market size analysis, by region, 2025-2035

Chapter 6. Global Explainable AI Market Size & Forecasts by Deployment 2025-2035

6.1. Market Overview
6.2. Global Growth Hormone Deficiency Market Performance - Potential Analysis (2025)
6.3. Cloud
- 6.3.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 6.3.2. Market size analysis, by region, 2025-2035
6.4. On premises
- 6.4.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 6.4.2. Market size analysis, by region, 2025-2035

Chapter 7. Global Explainable AI Market Size & Forecasts by Application 2025-2035

7.1. Market Overview
7.2. Global Growth Hormone Deficiency Market Performance - Potential Analysis (2025)
7.3. Fraud & Anomaly Detection
- 7.3.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 7.3.2. Market size analysis, by region, 2025-2035
7.4. Drug Discovery & Diagnostics
- 7.4.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 7.4.2. Market size analysis, by region, 2025-2035
7.5. Predictive Maintenance
- 7.5.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 7.5.2. Market size analysis, by region, 2025-2035

Chapter 8. Global Explainable AI Market Size & Forecasts by Application 2025-2035

8.1. Market Overview
8.2. Global Growth Hormone Deficiency Market Performance - Potential Analysis (2025)
8.3. BFSI
- 8.3.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.3.2. Market size analysis, by region, 2025-2035
8.4. Healthcare & Life Sciences
- 8.4.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.4.2. Market size analysis, by region, 2025-2035
8.5. Government & Defense
- 8.5.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.5.2. Market size analysis, by region, 2025-2035
8.6. Manufacturing
- 8.6.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.6.2. Market size analysis, by region, 2025-2035
8.7. Telecom & IT
- 8.7.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.7.2. Market size analysis, by region, 2025-2035
8.8. Retail & E-commerce
- 8.8.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.8.2. Market size analysis, by region, 2025-2035
8.9. Energy & Utilities
- 8.9.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.9.2. Market size analysis, by region, 2025-2035
8.10. Others
- 8.10.1. Top Countries Breakdown Estimates & Forecasts, 2024-2035
- 8.10.2. Market size analysis, by region, 2025-2035

Chapter 9. Global Explainable AI Market Size & Forecasts by Region 2025-2035

9.1. Growth Explainable AI Market, Regional Market Snapshot
9.2. Top Leading & Emerging Countries
9.3. North America Explainable AI Market
- 9.3.1. U.S. Explainable AI Market
  - 9.3.1.1. Component breakdown size & forecasts, 2025-2035
  - 9.3.1.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.3.1.3. Application breakdown size & forecasts, 2025-2035
  - 9.3.1.4. End Use breakdown size & forecasts, 2025-2035
- 9.3.2. Canada Explainable AI Market
  - 9.3.2.1. Component breakdown size & forecasts, 2025-2035
  - 9.3.2.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.3.2.3. Application breakdown size & forecasts, 2025-2035
  - 9.3.2.4. End Use breakdown size & forecasts, 2025-2035
9.4. Europe Explainable AI Market
- 9.4.1. UK Explainable AI Market
  - 9.4.1.1. Component breakdown size & forecasts, 2025-2035
  - 9.4.1.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.4.1.3. Application breakdown size & forecasts, 2025-2035
  - 9.4.1.4. End Use breakdown size & forecasts, 2025-2035
- 9.4.2. Germany Explainable AI Market
  - 9.4.2.1. Component breakdown size & forecasts, 2025-2035
  - 9.4.2.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.4.2.3. Application breakdown size & forecasts, 2025-2035
  - 9.4.2.4. End Use breakdown size & forecasts, 2025-2035
- 9.4.3. France Explainable AI Market
  - 9.4.3.1. Component breakdown size & forecasts, 2025-2035
  - 9.4.3.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.4.3.3. Application breakdown size & forecasts, 2025-2035
  - 9.4.3.4. End Use breakdown size & forecasts, 2025-2035
- 9.4.4. Spain Explainable AI Market
  - 9.4.4.1. Component breakdown size & forecasts, 2025-2035
  - 9.4.4.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.4.4.3. Application breakdown size & forecasts, 2025-2035
  - 9.4.4.4. End Use breakdown size & forecasts, 2025-2035
- 9.4.5. Italy Explainable AI Market
  - 9.4.5.1. Component breakdown size & forecasts, 2025-2035
  - 9.4.5.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.4.5.3. Application breakdown size & forecasts, 2025-2035
  - 9.4.5.4. End Use breakdown size & forecasts, 2025-2035
- 9.4.6. Rest of Europe Explainable AI Market
  - 9.4.6.1. Component breakdown size & forecasts, 2025-2035
  - 9.4.6.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.4.6.3. Application breakdown size & forecasts, 2025-2035
  - 9.4.6.4. End Use breakdown size & forecasts, 2025-2035
9.5. Asia Pacific Explainable AI Market
- 9.5.1. China Explainable AI Market
  - 9.5.1.1. Component breakdown size & forecasts, 2025-2035
  - 9.5.1.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.5.1.3. Application breakdown size & forecasts, 2025-2035
  - 9.5.1.4. End Use breakdown size & forecasts, 2025-2035
- 9.5.2. India Explainable AI Market
  - 9.5.2.1. Component breakdown size & forecasts, 2025-2035
  - 9.5.2.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.5.2.3. Application breakdown size & forecasts, 2025-2035
  - 9.5.2.4. End Use breakdown size & forecasts, 2025-2035
- 9.5.3. Japan Explainable AI Market
  - 9.5.3.1. Component breakdown size & forecasts, 2025-2035
  - 9.5.3.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.5.3.3. Application breakdown size & forecasts, 2025-2035
  - 9.5.3.4. End Use breakdown size & forecasts, 2025-2035
- 9.5.4. Australia Explainable AI Market
  - 9.5.4.1. Component breakdown size & forecasts, 2025-2035
  - 9.5.4.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.5.4.3. Application breakdown size & forecasts, 2025-2035
  - 9.5.4.4. End Use breakdown size & forecasts, 2025-2035
- 9.5.5. South Korea Explainable AI Market
  - 9.5.5.1. Component breakdown size & forecasts, 2025-2035
  - 9.5.5.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.5.5.3. Application breakdown size & forecasts, 2025-2035
  - 9.5.5.4. End Use breakdown size & forecasts, 2025-2035
- 9.5.6. Rest of APAC Explainable AI Market
  - 9.5.6.1. Component breakdown size & forecasts, 2025-2035
  - 9.5.6.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.5.6.3. Application breakdown size & forecasts, 2025-2035
  - 9.5.6.4. End Use breakdown size & forecasts, 2025-2035
9.6. Latin America Explainable AI Market
- 9.6.1. Brazil Explainable AI Market
  - 9.6.1.1. Component breakdown size & forecasts, 2025-2035
  - 9.6.1.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.6.1.3. Application breakdown size & forecasts, 2025-2035
  - 9.6.1.4. End Use breakdown size & forecasts, 2025-2035
- 9.6.2. Mexico Explainable AI Market
  - 9.6.2.1. Component breakdown size & forecasts, 2025-2035
  - 9.6.2.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.6.2.3. Application breakdown size & forecasts, 2025-2035
  - 9.6.2.4. End Use breakdown size & forecasts, 2025-2035
9.7. Middle East and Africa Explainable AI Market
- 9.7.1. UAE Explainable AI Market
  - 9.7.1.1. Component breakdown size & forecasts, 2025-2035
  - 9.7.1.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.7.1.3. Application breakdown size & forecasts, 2025-2035
  - 9.7.1.4. End Use breakdown size & forecasts, 2025-2035
- 9.7.2. Saudi Arabia (KSA) Explainable AI Market
  - 9.7.2.1. Component breakdown size & forecasts, 2025-2035
  - 9.7.2.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.7.2.3. Application breakdown size & forecasts, 2025-2035
  - 9.7.2.4. End Use breakdown size & forecasts, 2025-2035
- 9.7.3. South Africa Explainable AI Market
  - 9.7.3.1. Component breakdown size & forecasts, 2025-2035
  - 9.7.3.2. Deployment breakdown size & forecasts, 2025-2035
  - 9.7.3.3. Application breakdown size & forecasts, 2025-2035
  - 9.7.3.4. End Use breakdown size & forecasts, 2025-2035

Chapter 10. Competitive Intelligence

10.1. Top Market Strategies
10.2. IBM Corporation
- 10.2.1. Company Overview
- 10.2.2. Key Executives
- 10.2.3. Company Snapshot
- 10.2.4. Financial Performance (Subject to Data Availability)
- 10.2.5. Product/Services Port
- 10.2.6. Recent Development
- 10.2.7. Market Strategies
- 10.2.8. SWOT Analysis
10.3. Google LLC (Alphabet Inc.)
10.4. Microsoft Corporation
10.5. SAS Institute Inc.
10.6. Amazon Web Services, Inc. (AWS)
10.7. NVIDIA Corporation
10.8. Xilinx, Inc.
10.9. Fico, Inc.
10.10. Intel Corporation
10.11. Datasiku Inc.
10.12. Accenture Plc
10.13. Schneider Electric SE
10.14. Siemens AG
10.15. Cisco Systems, Inc.
10.16. Oracle Corporation