Incident Categorization Artificial Intelligence (AI) Global Market Report 2025

The incident categorization artificial intelligence market size has grown exponentially in recent years. It will grow from $1.64 billion in 2024 to $2.12 billion in 2025 at a compound annual growth rate (CAGR) of 29.7%. The growth in the historic period can be attributed to the increasing adoption of AI in IT service management, the growing need for faster incident resolution, the rising demand for automation in IT support processes, the increasing volume of IT service requests, and the rising focus on reducing manual errors in incident classification.

The incident categorization artificial intelligence market size is expected to see exponential growth in the next few years. It will grow to $5.94 billion in 2029 at a compound annual growth rate (CAGR) of 29.4%. The growth in the forecast period can be attributed to the increasing reliance on digital transformation initiatives, the growing focus on minimizing IT downtime, the rising adoption of cloud-based IT service platforms, the increasing demand for automated knowledge management, and the growing need for scalability in incident handling. Major trends in the forecast period include advancements in AI-powered incident prediction, the development of automated ticket classification systems, advancements in real-time analytics for incident prioritization, and the development of integrated AI and IT service management platforms.

The surge in cyber threats is expected to drive the growth of the incident categorization artificial intelligence (AI) market going forward. Cyber threats refer to malicious activities intended to disrupt, damage, or gain unauthorized access to digital systems, networks, and data. The rise in these threats is primarily fueled by increasing digitalization and cloud adoption, which expand the attack surface and create more entry points for cybercriminals to exploit vulnerabilities in interconnected systems. Incident categorization artificial intelligence assists organizations in managing such threats by automatically identifying, classifying, and prioritizing security incidents, enabling faster and more accurate detection and response. For instance, in 2023, according to the Australian Signals Directorate, the number of cybercrime reports in Australia increased to over 94,000, up from over 76,000 in 2022. Therefore, as cyber threats continue to escalate and digital attack surfaces broaden, the demand for incident categorization artificial intelligence solutions is expected to grow, fueling market expansion.

Major companies operating in the incident categorization artificial intelligence (AI) market are emphasizing advancements in AI technologies to strengthen operational resilience, improve system reliability, reduce downtime, and ensure continuous service delivery. Operational resilience refers to an organization’s ability to anticipate, withstand, and recover from disruptions while maintaining critical business operations. For instance, in October 2024, PagerDuty, a US-based digital operations management company, introduced new AI-powered capabilities to help organizations minimize the effects of unplanned outages and enhance operational resilience. The platform features a unified chat experience and upgrades to the Operations Console, improving coordination, reducing context switching, and accelerating incident response. These enhancements enable teams to predict, resolve, and prevent incidents more efficiently, reducing downtime costs and strengthening customer confidence.

In September 2023, Cisco Systems, Inc., a US-based digital communications technology company, acquired Splunk Inc. for approximately $28 billion. Through this acquisition, Cisco aims to integrate Splunk’s security and observability platform to enhance its cybersecurity and data analytics capabilities. Splunk Inc. is a US-based company that develops software for searching, monitoring, and analyzing machine-generated data.

Major players in the incident categorization artificial intelligence (AI) market are IBM Corporation, HCL Technologies Limited, ServiceNow Inc., Palo Alto Networks Inc., Fortinet Inc., Splunk Inc., Atlassian Corporation Plc, CrowdStrike Holdings Inc., Check Point Software Technologies Ltd., Datadog Inc., Elastic NV, Rapid7 Inc., Ivanti Inc., Freshworks Inc., Qualys Inc., PagerDuty Inc., Sumo Logic Inc., LogicMonitor Inc., SolarWinds Worldwide LLC, Moogsoft Inc., BMC Software Inc., Resolve Systems LLC, BigPanda Inc.

North America was the largest region in the incident categorization artificial intelligence market in 2024. Asia-pacific is expected to be the fastest-growing region in the forecast period. The regions covered in incident categorization artificial intelligence (AI) report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa. The countries covered in the incident categorization artificial intelligence (AI) market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

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 rapid escalation of U.S. tariffs and the resulting trade tensions in spring 2025 are significantly impacting the information technology sector, particularly in hardware manufacturing, data infrastructure, and software deployment. Higher duties on imported semiconductors, circuit boards, and networking equipment have raised production and operational costs for tech firms, cloud service providers, and data centers. Companies relying on globally sourced components for laptops, servers, and consumer electronics are facing longer lead times and increased pricing pressures. In parallel, tariffs on specialized software tools and retaliatory measures from key international markets have disrupted global IT supply chains and reduced overseas demand for U.S.-developed technologies. To navigate these challenges, the sector is accelerating investments in domestic chip fabrication, diversifying supplier bases, and adopting AI-driven automation to enhance operational resilience and cost efficiency.

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

Incident categorization artificial intelligence (AI) refers to the application of artificial intelligence to automatically analyze and classify IT support tickets or security alerts. It evaluates the text and context of incoming incidents to determine the type of issue, its priority level, and the appropriate support team for resolution. This technology continuously learns from historical data to enhance its accuracy and efficiency over time.

The primary components of incident categorization artificial intelligence (AI) include software and services. The software utilizes AI to automatically categorize and prioritize incidents across various organizational workflows. The market is segmented by organization size into small and medium enterprises and large enterprises. Deployment modes include on premises and cloud solutions. Key applications encompass IT operations, security operations, customer support, and risk management. The major end users are banking, financial services, and insurance (BFSI), healthcare, IT and telecom, government, retail, manufacturing, and other sectors.

The incident categorization artificial intelligence (AI) market consists of revenues earned by entities by providing services such as mobile/web apps, root cause analysis AI, predictive threat detection, and hybrid AI deployment. The market value includes the value of related goods sold by the service provider or contained within the service offering. The incident categorization artificial intelligence (AI) market also includes sales of real-time alerts and collaboration, automated reporting and analytics, user training & support, and consulting for workflow automation. 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 incident categorization AI market is segmented by component, deployment mode, organization size, application, and end-user.

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.

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