Explainable AI Global Market Report 2024

The explainable AI market size has grown exponentially in recent years. It will grow from $6.68 billion in 2023 to $8.1 billion in 2024 at a compound annual growth rate (CAGR) of 21.2%. The growth observed in the historical period can be attributed to the rising adoption of Augmented Reality (AR) and Virtual Reality (VR), the demand for Extended Reality (XR) displays, the overall growth in the display market, a high demand for AR devices, and economic growth.

The explainable AI market size is expected to see exponential growth in the next few years. It will grow to $17.15 billion in 2028 at a compound annual growth rate (CAGR) of 20.6%. The anticipated growth in the forecast period can be attributed to the increasing adoption in educational games, the rising implementation of gesture-based computing, the heightened usage of smartphones, increased utilization of connected devices, and growing adoption by the healthcare and educational sectors. Key trends expected in the forecast period encompass technological development in micro displays, the adoption ofnew technology, the development of extended reality technologies, the creation of new in-vehicle display imaging systems, and the integration of advanced technology in Extended Reality (ER) devices.

The anticipated increase in the adoption of the Internet of Things (IoT) is poised to drive the growth of the explainable AI market. The Internet of Things (IoT) entails a network of interconnected physical devices equipped with sensors, software, and other technologies facilitating data collection, exchange, and communication over the Internet or other communication networks. Explainable AI (XAI) finds application in the IoT landscape to bolster end-users' trust in machines, enhance interpretability and transparency of AI models, and ensure transparency, trustworthiness, and effective decision-making within IoT systems. As reported by AkamAI Technologies Inc., a US-based internet company, in August 2022, IoT connections are projected to surge from 15.1 billion in 2021 to 23.3 billion in 2025. Consequently, the escalating adoption of the Internet of Things (IoT) emerges as a key driver propelling the growth of the explainable AI market.

Prominent entities in the explainable AI market are strategically embracing partnership approaches to fortify their offerings and extend their market presence. A strategic partnership denotes a collaborative arrangement between two or more entities, typically businesses, aimed at achieving mutually beneficial and enduring objectives. As an example, in July 2023, Fujitsu Limited, a Japan-based information and communications technology company, forged a partnership with Informa D&B, a Spain-based marketing and information company. The collaboration seeks to enhance decision-making by leveraging Fujitsu's explainable AI to transparently process and analyze data. This strategic move addresses the imperative need for advanced AI solutions to mitigate risks, particularly in areas such as financial fraud. XAI contributes insights into decision-making, fostering transparency and trust while minimizing biases.

In June 2021, InRule Technology, a US-based software company, completed the acquisition of simMachines Inc. for an undisclosed amount. This strategic acquisition positions InRule Technology to enhance its decision automation capabilities, contributing to a more comprehensive AI solution in the market. simMachines Inc., a US-based machine learning software company specializing in explainable AI, is a key player in this development.

Major companies operating in the explainable AI market report are Amazon Web Services, Alphabet Inc., Microsoft Corporation, Intel Corporation, International Business Machines Corporation, NVIDIA Corporation, Salesforce Inc., Equifax Inc., SAS Institute Inc., Mphasis Limited, Fair Isaac Corporation, Databricks Inc., Alteryx Inc., Amelia US LLC, Temenos Headquarters SA, BuildGroup LLC, C3.AI Inc., Data Robot Inc., Tredence Analytics Solutions Pvt. Ltd., ArthurAI Inc., DarwinAI Corp., ISSQUARED Inc., H2O.AI Inc., Fiddler Labs Inc., Ditto Labs Inc.

North America was the largest region in the Explainable AI market in 2023. The regions covered in the explainable AI market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the explainable AI market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The explainable AI market consists of revenues earned by entities by providing services such as interpretable models, local explanations, feature importance analyses, rule-based explanations, model-agnostic approaches, customization, and configuration. The market value includes the value of related goods sold by the service provider or included within the service offering. The explainable AI market also includes sales of high-speed pick-and-place operational tools, controller systems, vision systems, and conveyor systems. 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).

Explainable Artificial Intelligence (XAI) is an artificial intelligence system strategically designed to offer clear and comprehensible explanations of its decisions or outputs. Its purpose extends to describing an AI model, delineating its anticipated impact, disclosing potential biases, and aiding in the characterization of model accuracy, fairness, transparency, and outcomes within AI-powered decision-making processes.

The primary types of software within explainable AI encompass standalone software, integrated software, automated reporting tools, and interactive model visualization. Standalone software denotes a computer program capable of running as a separate process without dependency on other software or services. This includes various methods such as model-agnostic methods and model-specific methods. End-users benefiting from explainable AI span diverse sectors, including banking, financial services, and insurance (BFSI), retail and e-commerce, information technology/information technology-enabled services, healthcare and life sciences, government and public sector, media and entertainment, manufacturing, energy and utilities, telecommunications, and other verticals.

The explainable AI market research report is one of a series of new reports that provides explainable AI market statistics, including explainable AI industry global market size, regional shares, competitors with an explainable AI market share, detailed explainable AI market segments, market trends and opportunities, and any further data you may need to thrive in the explainable AI industry. This explainable AI 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 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.


This product will be delivered within 3-5 business days.