A new forecast from the International Data Corporation (IDC) Worldwide Artificial Intelligence Spending Guide shows that global spending on artificial intelligence (AI), including software, hardware, and services for AI-centric systems, will reach nearly $118-billion in 2022 and surpass $300-billion in 2026.

The ongoing incorporation of AI into a wide range of products will drive a compound annual growth rate (CAGR) of 26,5% over the 2022-2026 forecast. This is more than four times greater than the five-year CAGR of 6,3% for worldwide IT spending over the same period.

The past two difficult years in business accelerated the use of AI in systems, and organisations are now more willing to take advantage of the efficiency benefits and enhanced capabilities that AI systems offer.

AI systems can support people-oriented tasks and improve their capabilities through technologies such as Conversational AI and Image Processing, used to interact with clients and potential clients in a way that these people are prepared to accept.

The high and consistent growth seen in the use of AI in all industries demonstrates its importance to future business.

“AI is not the future, it is now,” says Mike Glennon, senior market research analyst with IDC’s Customer Insights & Analysis team. “Most IT vendors have adopted AI solutions to supplement their products and are enhancing their products to make AI crucial to their success.

“Those vendors that are only now considering AI are at a considerable disadvantage to IT vendors that have AI-based products already in production, and AI is becoming crucial to the capabilities of many products.”

Banking and Retail are the two industries that will deliver the largest AI investments over the forecast period. Together, the two industries will account for roughly one quarter of all AI spending worldwide.

Professional services will be the next largest industry with more than 10% share of spending, followed by discrete and process manufacturing. Professional services will also be one of the industries with the fastest growth in AI spending (28,7% CAGR), trailing only the Media industry (29,8% CAGR).

Among the 30 AI use cases identified by IDC, Augmented Customer Service Agents will see the most spending throughout the forecast, reaching $35,9-billion on 2026.

While it is the largest use case in only two industries (Retail and Telecommunications), Augmented Customer Service Agents are an investment area for every industry.

Other leading AI use cases include Sales Process Recommendation and Augmentation, Fraud Analysis and Investigation, and Program Advisors and Recommendation Systems. By 2026, these four use cases will represent more than 38% of all AI spending worldwide.

“Three of the leading use cases are customer and sales focused, showing that adopters of AI are using it to grow their business significantly with a strong customer and sales focus at a time when the economy struggles,” Glennon notes. “The use of AI in business is moving away from simple cost saving to being a strong component of business growth, showing the increasing maturity of AI as an IT solution across a wide range of systems.”

The US will be the largest geographic market for AI systems, accounting for more than 50% of all AI spending worldwide throughout the forecast. Retail and Banking will the leading industries for AI investments in the US.

Western Europe will account for more than 20% of worldwide IT spending and will deliver the fastest spending growth with a five-year CAGR of 30%.

The People’s Republic of China will be the third-largest AI market with one of the slowest growth rates (21,1% CAGR).