AI in IoT Market Report 2026

The artificial intelligence (AI) in iot market size has grown exponentially in recent years. It will grow from $19.38 billion in 2025 to $24.56 billion in 2026 at a compound annual growth rate (CAGR) of 26.7%. The growth in the historic period can be attributed to adoption of cloud computing, proliferation of connected devices, advancements in machine learning algorithms, growth in smart manufacturing, increasing demand for automation.

The artificial intelligence (AI) in iot market size is expected to see exponential growth in the next few years. It will grow to $63.64 billion in 2030 at a compound annual growth rate (CAGR) of 26.9%. The growth in the forecast period can be attributed to integration of AI with edge computing, rise of smart cities and infrastructure, expansion of industrial iot networks, demand for predictive maintenance solutions, growth in autonomous transport and robotics. Major trends in the forecast period include edge AI integration, predictive maintenance solutions, real-time data analytics, ai-driven automation, smart sensor development.

The expansion of 5G networks is expected to drive the growth of Artificial Intelligence (AI) in the IoT market going forward. 5G network expansion refers to the deployment of fifth-generation wireless technology, offering higher speeds, more reliable connections, and greater capacity than previous networks. This expansion is accelerating as major operators and governments worldwide intensified deployments and coverage in 2023. AI in IoT leverages 5G by enabling intelligent device connectivity, real-time data processing, and automation at the edge, maximizing the benefits of high-speed, low-latency infrastructure. For example, in December 2023, Germany’s Bundesnetzagentur reported that 5G coverage by at least one network operator increased to 90% of the country in October 2023, up from 79% the previous year. Therefore, the growth of 5G networks is driving the adoption of AI in the IoT market.

Major companies in the AI in IoT market are focusing on advanced solutions, such as edge AI and sensor-integrated IoT platforms, to enhance operational efficiency, reduce costs, and improve security across connected devices. Edge AI IoT platforms combine smart sensors, machine learning models running on or near the device, and IoT connectivity to provide real-time analytics, anomaly detection, and automated decision-making without relying solely on centralized cloud processing. For instance, in December 2023, STMicroelectronics, a Switzerland-based semiconductor company, launched the ST Edge AI Suite - an integrated ecosystem of hardware, software tools, and developer libraries designed for industries such as automotive, consumer electronics, and building automation. The suite enables low-power edge inference, streamlined toolchains, and seamless integration with IoT platforms to optimize security and operational workflows.

In June 2025, Nordic Semiconductor ASA, a Norway-based company specializing in ultra-low-power wireless connectivity solutions, acquired the intellectual property and core technology assets of Neuton.AI, Inc. The acquisition enables Nordic Semiconductor to strengthen its edge AI/ML capabilities by integrating Neuton.AI’s TinyML platform with its nRF54 Series ultra-low-power wireless SoCs, supporting always-on AI devices and enhancing its position in the AIoT market. Neuton.AI, Inc. is a U.S.-based company providing automated TinyML model generation and embedded AI solutions for resource-constrained edge devices.

Major companies operating in the artificial intelligence (AI) in iot market are Amazon Inc.; Google LLC; Microsoft Corporation; Hitachi Ltd.; General Electric (GE); Intel Corporation; Accenture PLC; International Business Machines Corporation; Cisco Systems Inc.; Qualcomm Technologies Inc.; Oracle Corporation; Honeywell International Inc.; SAP SE; Fujitsu Limited; NVDIA Corporation; Texas Instruments Incorporated; STMicroelectronics; Infineon Technologies AG; Renesas Electronics Corporation; ARM Holdings; PTC Inc.; Softweb Solutions Inc.; SpaceTime Insight Inc.; CloudMinds Inc.

North America was the largest region in the artificial intelligence (AI) in IoT market in 2025. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the artificial intelligence (AI) in iot market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the artificial intelligence (AI) in iot market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Tariffs have influenced the AIoT market by impacting the cost and availability of key hardware components such as sensors, microcontrollers, and communication modules. The increase in import duties has particularly affected regions like North America and Europe, which rely on components manufactured in Asia-Pacific countries such as China and Taiwan. Segments such as IoT platforms with AI capabilities and edge AI software have experienced cost pressures, leading manufacturers to explore local sourcing and diversify suppliers. Despite these challenges, tariffs have encouraged innovation and the development of more cost-efficient AIoT solutions, creating opportunities for domestic production and localized service offerings.

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

Artificial Intelligence of Things (AIoT) is the amalgamation of Internet of Things (IoT) infrastructure and artificial intelligence (AI) technology, harnessing AI algorithms and models alongside the extensive network of interconnected physical devices, sensors, and systems constituting the IoT. This fusion elevates the capabilities of the IoT through data analysis, predictive insights, automation, and intelligent decision-making.

The primary components within artificial intelligence (AI) in IoT encompass software, platforms, and services. Software encompasses a spectrum of programs, data, or instructions utilized for computer operations and task execution. This encompasses a variety of technologies such as machine learning, natural language processing, image processing, speech recognition, catering to end-users across sectors including energy and utilities, manufacturing, retail, transportation and mobility, as well as banking, financial services, and insurance (BFSI).

The artificial intelligence (AI) in IoT market consists of revenues earned by entities by providing services such as data analytics and insights, predictive maintenance, enhanced security, optimized resource management, smart home automation, and edge computing. The market value includes the value of related goods sold by the service provider or included within the service offering. The face-swiping payment market also includes sales of sensors and actuators, edge computing devices, and remote monitoring and control devices. 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.

This product will be delivered within 1-3 business days.