Mumbai: The rapid integration of AI in the consumer and enterprise sectors is expected to drive a 33% enhance in global net revenues from AI-powered semiconductors in 2024.
Revenues for chipmakers specializing in artificial intelligence-ready computing processors are expected to grow 32.8% to $71.25 billion through December, according to a report by market researcher Gartner released on Thursday.
How will AI adoption accelerate further?
Echoing the report’s findings, industry analysts and stakeholders also expect AI adoption to continue to accelerate with growing demand for AI tools in data centers around the world, as well as greater consumer adoption of AI-enabled devices.
In data centers alone, AI chip adoption is projected to generate revenues of $21 billion in 2024, growing at a compound annual rate of nearly 12% thereafter to reach $33 billion by 2028.
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Moreover, the consumer electronics industry will contribute to this growth, driven by the continued enhance in the number of AI-ready chips used in personal computers. This trend is expected to continue over the next three years, the report says.
Gartner’s analysis shows that “artificial intelligence PCs,” which include desktops and laptops equipped with dedicated chips for AI tasks, will account for just over one-fifth of all modern desktop and laptop sales globally this year.
“By the end of 2026, 100% of PCs purchased for enterprises will be AI-enabled,” the report says, highlighting the potential impact of Microsoft’s AI PC launch announcement earlier this month.
On May 20, Microsoft CEO Satya Nadella unveiled “Copilot+ computers,” a set of specifications requiring brands to operate chips with dedicated neural processors to enhance modern features available in Microsoft’s Windows operating system.
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Starting with the Qualcomm Snapdragon X Elite series of processors, the modern chips will provide more than 40 trillion operations per second (TOPS) of AI processing power for each computer, which in turn is expected to enhance demand for AI semiconductors.
Additionally, auto companies are expected to generate $7.1 billion in AI chip revenue this year, driven by growing demand for next-generation driving assist technologies and software in vehicles.
India can also make a significant impact. For example, Mumbai-based Yotta Data Services, backed by the Hiranandani Group, has placed an order for 16,000 graphics processing units (GPUs) from Nvidia to meet growing demand for AI development and cloud applications.
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Moreover, the company was among the first users in India to purchase Nvidia’s latest Blackwell GPUs to power its large-scale AI cloud computing platform that can facilitate train immense language models (LLM).
However, in the consumer market, adoption of AI-first desktops may take some time given that AI desktops are likely to be available at a higher price point, said Navkendar Singh, associate vice president at market research firm IDC India. “Shipment growth will be driven by enterprises and will be reflected in the revenues of the PC economy next year,” he added.
Posted: May 30, 2024 9:30 PM ET
