PUBLISHER: The Business Research Company | PRODUCT CODE: 1773503
PUBLISHER: The Business Research Company | PRODUCT CODE: 1773503
Artificial intelligence (AI) in the military plays a crucial role in facilitating rapid decision-making in both dynamic, information-dense environments and scenarios with limited information. It is extensively employed in military intelligence for analyzing enemy intelligence and finds application in autonomous vehicles and weapon systems. AI also supports and aids in planning military operations, enhancing overall efficiency.
The primary offerings of AI in the military encompass hardware, software, and services. Hardware refers to the tangible components of computers that store and execute instructions provided by the software. Various technologies involved in AI include machine learning, natural language processing, context-aware computing, computer vision, intelligent virtual agents (IVA) or virtual agents, and others. These technologies are applied across diverse platforms, including land, naval, and airborne. Installations of AI in the military cover new procurement and upgrades, utilized in applications such as information processing, simulation and training, warfare platforms, threat monitoring, situational awareness, cybersecurity, and various other military applications.
Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report's Recommendations and Conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.
The sharp increase in U.S. tariffs and resulting trade disputes in spring 2025 are significantly affecting the aerospace and defense sector. Prices for key materials such as titanium, carbon fiber composites, and avionics primarily sourced from international suppliers have surged. Defense contractors, constrained by fixed-price government contracts, are forced to absorb these rising costs. Meanwhile, commercial aerospace companies are encountering resistance from airlines over increased aircraft prices. In addition, customs delays are disrupting already tight production timelines for jets and satellites. In response, the industry is stockpiling essential materials, pursuing import waivers for defense-related goods, and working with allied nations to diversify supply chains.
The artificial intelligence in military market research report is one of a series of new reports from The Business Research Company that provides artificial intelligence in military market statistics, including artificial intelligence in military industry global market size, regional shares, competitors with an artificial intelligence in military market share, detailed artificial intelligence in military market segments, market trends and opportunities, and any further data you may need to thrive in the artificial intelligence in military industry. This artificial intelligence in military market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.
The artificial intelligence in military market size has grown rapidly in recent years. It will grow from $9.67 billion in 2024 to $11.19 billion in 2025 at a compound annual growth rate (CAGR) of 15.7%. The growth in the historic period can be attributed to rise in budget allocations, rise in cybersecurity concerns, increasing data availability, rise in threats, economic growth.
The artificial intelligence in military market size is expected to see rapid growth in the next few years. It will grow to $19.41 billion in 2029 at a compound annual growth rate (CAGR) of 14.8%. The growth in the forecast period can be attributed to geopolitical tensions, rise in research and development, growing military and defense sector, rising government support, rising industrial automation. Major trends in the forecast period include industry partnerships, human-machine teaming, dual-use technologies, cognitive electronic warfare, swarm technology.
The forecast of 14.8% growth over the next five years reflects a modest reduction of 0.3% from the previous estimate for this market.This reduction is primarily due to the impact of tariffs between the US and other countries. This is likely to directly affect the US through supply chain disruptions for neural network training servers, sourced from key regions such as the US and Singapore, which could lead to higher costs for battlefield analytics.The effect will also be felt more widely due to reciprocal tariffs and the negative effect on the global economy and trade due to increased trade tensions and restrictions.
The proliferation of artificial intelligence in the military domain is being propelled by increased spending on defense. Artificial intelligence technology, emulating human intelligence in machines, has found particular significance in military applications. Numerous governments have established specialized departments and organizations to harness AI capabilities, integrating them into military equipment. In April 2022, the Stockholm International Peace Research Institute (SIPRI) reported that global military spending in 2021 increased by 0.7% in real terms to $2113 billion, marking the seventh consecutive year of growth. Notably, the US witnessed a 24% surge in military R&D funding from 2012 to 2021, and China, the world's second-largest spender, allocated an estimated $293 billion to its military in 2021, reflecting a 4.7% increase over the previous year. The continual surge in China's military expenditure over the past 27 years highlights the impetus behind the increased investment in defense, thus driving the growth of artificial intelligence in the military market.
The augmentation of artificial intelligence in the military market is also propelled by rising investment in advanced military equipment. This equipment, characterized by its high sophistication and reliance on artificial intelligence (AI) and machine learning (ML), enhances the efficiency and adaptability of military operations. Notably, the Pentagon's 2022 research and development budget request underscores this trend. With an allocation of $874 million for AI and ML technologies, the United States Army seeks to boost its capabilities through investment in AI and ML-based research and development. This request includes allocations of $10.2 million for basic research, $15 million for applied research, and $0.9 million for advanced AI and ML technologies. This considerable investment indicates the vital role AI and ML play in enhancing military technologies, signaling the expected support and growth of artificial intelligence in the military market in the forecast period.
The artificial intelligence in the military market is witnessing significant advancements in technology. Major industry players are directing their focus toward innovative technological solutions to fortify their position. An example is the collaboration between Raytheon Technologies and C3 AI, announced in July 2022. The partnership aims to deploy next-generation AI and ML capabilities through the Tactical Intelligence Targeting Access Node (TITAN) program for the US Army. This program is designed to ingest data from various sources, including high-altitude and space sensors, to deliver targetable data and enhance situational awareness for military purposes. This collaboration signifies the increasing prominence of technological advancements within the artificial intelligence in the military market.
Major contenders within the artificial intelligence in the military sector are placing a significant emphasis on introducing innovative projects and products to maintain their market standing. An illustrative case is the initiation of Project Linchpin by the US Army in May 2023. This project's objective involves adapting the conventional AI and machine learning operations pipeline from the technology industry, tailoring it to function within a secure government environment while safeguarding operational data. Project Linchpin endeavors to establish a secure architecture that can be replicated across the Army, facilitating the large-scale implementation of AI. It serves as a disciplined framework enabling the continuous integration of machine learning capabilities into various army programs.
In May 2022, EMCORE Corporation, a communication device company based in the United States, executed the acquisition of L3Harris's space and navigation business for an estimated $5 million. This acquisition positions EMCORE to expand its inertial navigation product portfolio, incorporating inertial measurement unit products as well as navigation and strategic-grade gyro products from L3Harris Technologies, a US-based aerospace and defense technology company.
Major companies operating in the artificial intelligence in military market include Charles River Analytics Inc., BAE Systems PLC., Northrop Grumman Corporation, RTX Corporation, Lockheed Martin Corporation, Thales Group, Harris Corporation, International Business Machines Corporation, Rafael Advanced Defense Systems, Microsoft Corporation, Oracle Corporation, Amazon Web Services Inc., SAS Institute, Meta Platforms Inc., SAP SE, Salesforce Inc., Baidu Inc., SoarTech, Google LLC, NVIDIA Corporation, Intel Corporation, General Dynamics Corporation, Rolls-Royce Holdings plc, General Electric Aviation, Safran S.A., Israel Aerospace Industries, Triumph Group Inc., Boeing Co., Airbus SE, Leonardo S.p.A., L3Harris Technologies Inc., Elbit Systems Ltd., Rheinmetall AG, Collins Aerospace, Kongsberg Gruppen
North America was the largest region in the artificial intelligence in military market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in this report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa.
The countries covered in the artificial intelligence in military market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA.
The artificial intelligence in military market consists of sales of artificial intelligence in military services such as facial recognition, language translation, remotely operated weapon stations, robotic mine detectors, and intrusion detection services. The market value includes the value of related goods sold by the service provider or included within the service offering. The artificial intelligence in military market also includes sales of sensor, drone, detector, computers equipment's which are used in providing artificial intelligence in military. Values in this market are 'factory gate' values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.
The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).
The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.
Artificial Intelligence in Military Global Market Report 2025 from The Business Research Company provides strategists, marketers and senior management with the critical information they need to assess the market.
This report focuses on artificial intelligence in military market which is experiencing strong growth. The report gives a guide to the trends which will be shaping the market over the next ten years and beyond.
Where is the largest and fastest growing market for artificial intelligence in military? How does the market relate to the overall economy, demography and other similar markets? What forces will shape the market going forward, including technological disruption, regulatory shifts, and changing consumer preferences? The artificial intelligence in military market global report from the Business Research Company answers all these questions and many more.
The report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market's historic and forecast market growth by geography.
The forecasts are made after considering the major factors currently impacting the market. These include the technological advancements such as AI and automation, Russia-Ukraine war, trade tariffs (government-imposed import/export duties), elevated inflation and interest rates.