The UAE artificial intelligence market was valued at USD 4.60 billion in 2025. It is estimated at USD 9.80 billion in 2026 and is projected to reach USD 51.29 billion by 2036, growing at a CAGR of 18.0% over the 2026-2036 forecast period. This report offers a detailed assessment of the market, covering national AI policy, emirate-level programs, AI compute and data center build-out, chip access and export controls, investment flows, data governance, talent, the value chain, and the competitive landscape.
The study measures AI spending by government bodies, enterprises, and other organizations in all seven emirates. It includes AI infrastructure such as accelerated compute, networking, storage, and AI-optimized data centers; software and platforms ranging from foundation models and LLMs to ML platforms and applications; and services such as consulting, integration, managed AI cloud, and training. Consumer devices with embedded AI and IT spending unrelated to AI are excluded. The ecosystem links national AI companies, sovereign funds, global cloud, model, and chip suppliers, data center operators, universities, regulators, and end users.
The UAE has treated AI as a national priority since 2017, when it adopted its National Strategy for Artificial Intelligence with 2031 targets and named the first Minister of State for Artificial Intelligence anywhere in the world. Investment has since moved to an industrial scale. In May 2025, the two governments unveiled plans for a 5-gigawatt campus in Abu Dhabi; Stargate UAE, a 1-gigawatt cluster inside it built by G42 with OpenAI, Oracle, NVIDIA, Cisco, and SoftBank, forms the first phase and is set to switch on 200 megawatts of GB300 systems in 2026. As reported under the U.S.-UAE AI Acceleration Partnership, the country may import up to 500,000 advanced NVIDIA chips each year, and U.S. export licenses for G42 were approved in late November 2025. According to OpenAI, the cluster could reach users up to 2,000 miles away, an area home to about half of the world's population.
Growth is held back by reliance on American export approvals for advanced chips, as licenses were delayed in mid-2025 amid concerns over G42 and were granted only after the company gave security assurances that chips would not be diverted or remotely accessed by unapproved parties, so any change in U.S. policy could slow the build-out. The country also relies heavily on foreign specialists and competes with the U.S., Europe, and Asia for AI researchers, engineers, and data center staff. Large AI campuses need very high power and cooling capacity in a hot climate, and data protection rules differ between federal law and the DIFC and ADGM free zones. Other challenges include limited high-quality Arabic training data, the difficulty of proving enterprise returns on AI spending, frequent cyberattacks on a high-profile digital economy, and the need to align technology and supply chain choices with U.S. partners.
The leading opportunity lies in serving AI demand across the Middle East, Africa, and South Asia from UAE compute capacity, helped by Fujairah's subsea cable landings. Arabic and sovereign models such as the Technology Innovation Institute's Falcon series and Jais, built by G42's Inception with MBZUAI and Cerebras, can serve the more than 400 million Arabic speakers across the region. AI use in energy, healthcare, and government also offers sizable domestic demand, including AIQ, the ADNOC and G42 joint venture, and M42's work on national genomics programs. Key trends include sovereign AI and national models, close partnerships with U.S. technology leaders, AI-first government services, and investment in AI education and talent.
Based on component, the market is segmented into AI infrastructure, software & platforms, and services, and the report also sizes nine sub-segments, from compute and AI data centers to foundation models, managed AI cloud, and training & support. AI infrastructure is expected to hold the largest share in 2026, as spending on Stargate UAE, which is due to deliver its first 200 megawatts of GB300 systems that year, and on other AI data centers dominates early market value. GPU servers, networking, and purpose-built facilities are the most capital-intensive items and must be installed before models can run at scale. Software & platforms are expected to grow at the highest CAGR during the forecast period, as government bodies and enterprises adopt generative AI platforms, AI agents, and sector-specific applications once compute capacity is available. Services remain important for integration, managed sovereign cloud, and workforce training as projects move from pilots into production.
Based on technology, the market is segmented into generative AI & large language models, machine learning, computer vision, natural language processing & Arabic AI, and robotics & autonomous systems. Machine learning is expected to account for the largest share in 2026, given its long-established use in predictive analytics, forecasting, and risk models across energy, finance, and government, where it is already embedded in core operations. Generative AI & large language models are expected to record the highest CAGR, supported by nationwide access to generative AI tools under the Stargate UAE partnership with OpenAI and by locally developed models such as Falcon and Jais. Natural language processing & Arabic AI is a distinctive niche, as regional buyers want models that handle Arabic dialects under local control.
Based on deployment, the market is segmented into sovereign & hyperscale cloud, on-premises, and edge. Sovereign & hyperscale cloud is expected to hold the largest share in 2026, reflecting the growth of sovereign AI cloud providers such as Core42 and large-scale infrastructure such as Stargate UAE, which allow government agencies and enterprises to use advanced models while keeping sensitive data in the country. The edge segment is expected to grow at the highest CAGR, driven by AI use in smart cities, autonomous transport, and industrial sites, where low latency and local processing are required. On-premises systems still serve users with strict security needs.
Based on end-use sector, the market is segmented into government & public services, energy & utilities, BFSI, healthcare & life sciences, transportation & logistics, real estate & retail, telecommunications, education, and others. Government & public services is expected to account for the largest share in 2026, because federal and emirate authorities have led AI adoption since the 2017 national strategy, appointed chief AI officers, and are building AI into licensing, transport, healthcare, and customer service. Healthcare & life sciences is expected to grow at the highest CAGR, supported by AI in diagnostics, genomics, and personalized medicine, including M42's role in national genomics programs. Energy & utilities is another major sector, as ADNOC uses AI for exploration, production optimization, and maintenance through AIQ.
Based on enterprise size, the market is segmented into large enterprises & government entities and small & medium-sized enterprises. Large enterprises & government entities are expected to account for the larger share in 2026, since government bodies, state-owned companies, and major corporations fund the largest infrastructure, platform, and sovereign cloud programs and have the budgets and data assets to run them. Small & medium-sized enterprises are expected to register the higher CAGR, as cloud-based AI tools lower the cost of entry and nationwide access to generative AI services brings AI within reach of smaller businesses without in-house data science teams.
Abu Dhabi is expected to lead the UAE artificial intelligence market in 2026, as most of the country's AI infrastructure, sovereign capital, and research base sit in the emirate. The emirate is the site of the UAE-US AI Campus and Stargate UAE, and it is home to G42 and its subsidiaries, MGX, MBZUAI, and the Technology Innovation Institute. ADNOC's AI programs through AIQ, the ADGM free zone and its data protection framework, and power from the 5.6-gigawatt Barakah nuclear plant add to the emirate's position.
Dubai is expected to grow at the highest CAGR during the forecast period, backed by a dense mix of corporates, banks, and multinationals and by active government AI programs. The Dubai Universal Blueprint for Artificial Intelligence, launched in 2024, placed chief AI officers across government entities, and the emirate runs the Dubai Centre for Artificial Intelligence and the Dubai AI Campus in DIFC. An autonomous mobility target for 2030 and AI use by Emirates and DP World add demand in aviation and logistics. Sharjah holds a moderate share, built on AI research and training at the American University of Sharjah and the University of Sharjah, startups in the Sharjah Research, Technology and Innovation Park, and digitized public services. The Northern Emirates are expected to grow strongly from a smaller base, with Fujairah serving as a major subsea cable landing point, Ras Al Khaimah developing technology and digital asset free zones, and federal programs extending AI access and education to all seven emirates.
The market brings together national AI leaders and their group companies, sovereign funds, telecom and data center operators, global cloud, model, and chip suppliers, research institutes, and a growing number of startups. Companies compete and collaborate on access to compute and chips, model quality including Arabic performance, sovereign and secure deployment, sector knowledge, and compliance with export controls and data rules. Leading players are building sovereign AI infrastructure, releasing open and Arabic models, setting up joint ventures with large UAE companies such as ADNOC, and partnering with global technology firms. Notable developments include Microsoft's 2024 investment in G42, which came with G42 moving workloads to Azure and exiting Chinese hardware suppliers, the 2025 launch of Stargate UAE as the first project under OpenAI for Countries, and the U.S. approval of chip export licenses for G42 in November 2025.
Key companies profiled in the report include G42 (UAE), Core42 (UAE), Presight AI Holding PLC (UAE), AIQ (UAE), M42 (UAE), Space42 PLC (UAE), Khazna Data Centers (UAE), MGX (UAE), Technology Innovation Institute (UAE), e& (Emirates Telecommunications Group Company PJSC) (UAE), Emirates Integrated Telecommunications Company PJSC (du) (UAE), Microsoft Corporation (U.S.), OpenAI (U.S.), Oracle Corporation (U.S.), NVIDIA Corporation (U.S.), Cerebras Systems Inc. (U.S.), and Amazon Web Services, Inc. (U.S.).
The study measures AI spending by government bodies, enterprises, and other organizations in all seven emirates. It includes AI infrastructure such as accelerated compute, networking, storage, and AI-optimized data centers; software and platforms ranging from foundation models and LLMs to ML platforms and applications; and services such as consulting, integration, managed AI cloud, and training. Consumer devices with embedded AI and IT spending unrelated to AI are excluded. The ecosystem links national AI companies, sovereign funds, global cloud, model, and chip suppliers, data center operators, universities, regulators, and end users.
The UAE has treated AI as a national priority since 2017, when it adopted its National Strategy for Artificial Intelligence with 2031 targets and named the first Minister of State for Artificial Intelligence anywhere in the world. Investment has since moved to an industrial scale. In May 2025, the two governments unveiled plans for a 5-gigawatt campus in Abu Dhabi; Stargate UAE, a 1-gigawatt cluster inside it built by G42 with OpenAI, Oracle, NVIDIA, Cisco, and SoftBank, forms the first phase and is set to switch on 200 megawatts of GB300 systems in 2026. As reported under the U.S.-UAE AI Acceleration Partnership, the country may import up to 500,000 advanced NVIDIA chips each year, and U.S. export licenses for G42 were approved in late November 2025. According to OpenAI, the cluster could reach users up to 2,000 miles away, an area home to about half of the world's population.
Market Dynamics
Demand is anchored by sustained government commitment, as federal and emirate authorities have appointed chief AI officers, built AI into public services, opened a dedicated graduate AI university in 2019, and added AI to school curricula, giving investors and partners confidence in long-term policy. Sovereign capital is a second driver: Microsoft took a USD 1.5 billion stake in G42 in 2024, as reported at the time, and MGX, set up in 2024 with Mubadala and G42 as founding shareholders, invests in AI infrastructure and companies at home and abroad. The compute build-out is the third driver, with G42's chief executive planning 200 to 500 megawatts of new capacity per quarter after the first phase.Growth is held back by reliance on American export approvals for advanced chips, as licenses were delayed in mid-2025 amid concerns over G42 and were granted only after the company gave security assurances that chips would not be diverted or remotely accessed by unapproved parties, so any change in U.S. policy could slow the build-out. The country also relies heavily on foreign specialists and competes with the U.S., Europe, and Asia for AI researchers, engineers, and data center staff. Large AI campuses need very high power and cooling capacity in a hot climate, and data protection rules differ between federal law and the DIFC and ADGM free zones. Other challenges include limited high-quality Arabic training data, the difficulty of proving enterprise returns on AI spending, frequent cyberattacks on a high-profile digital economy, and the need to align technology and supply chain choices with U.S. partners.
The leading opportunity lies in serving AI demand across the Middle East, Africa, and South Asia from UAE compute capacity, helped by Fujairah's subsea cable landings. Arabic and sovereign models such as the Technology Innovation Institute's Falcon series and Jais, built by G42's Inception with MBZUAI and Cerebras, can serve the more than 400 million Arabic speakers across the region. AI use in energy, healthcare, and government also offers sizable domestic demand, including AIQ, the ADNOC and G42 joint venture, and M42's work on national genomics programs. Key trends include sovereign AI and national models, close partnerships with U.S. technology leaders, AI-first government services, and investment in AI education and talent.
Segment Analysis
The report analyzes the market by component, technology, deployment, end-use sector, enterprise size, and emirate, helping stakeholders identify where spending is concentrated and where it is expanding fastest.Based on component, the market is segmented into AI infrastructure, software & platforms, and services, and the report also sizes nine sub-segments, from compute and AI data centers to foundation models, managed AI cloud, and training & support. AI infrastructure is expected to hold the largest share in 2026, as spending on Stargate UAE, which is due to deliver its first 200 megawatts of GB300 systems that year, and on other AI data centers dominates early market value. GPU servers, networking, and purpose-built facilities are the most capital-intensive items and must be installed before models can run at scale. Software & platforms are expected to grow at the highest CAGR during the forecast period, as government bodies and enterprises adopt generative AI platforms, AI agents, and sector-specific applications once compute capacity is available. Services remain important for integration, managed sovereign cloud, and workforce training as projects move from pilots into production.
Based on technology, the market is segmented into generative AI & large language models, machine learning, computer vision, natural language processing & Arabic AI, and robotics & autonomous systems. Machine learning is expected to account for the largest share in 2026, given its long-established use in predictive analytics, forecasting, and risk models across energy, finance, and government, where it is already embedded in core operations. Generative AI & large language models are expected to record the highest CAGR, supported by nationwide access to generative AI tools under the Stargate UAE partnership with OpenAI and by locally developed models such as Falcon and Jais. Natural language processing & Arabic AI is a distinctive niche, as regional buyers want models that handle Arabic dialects under local control.
Based on deployment, the market is segmented into sovereign & hyperscale cloud, on-premises, and edge. Sovereign & hyperscale cloud is expected to hold the largest share in 2026, reflecting the growth of sovereign AI cloud providers such as Core42 and large-scale infrastructure such as Stargate UAE, which allow government agencies and enterprises to use advanced models while keeping sensitive data in the country. The edge segment is expected to grow at the highest CAGR, driven by AI use in smart cities, autonomous transport, and industrial sites, where low latency and local processing are required. On-premises systems still serve users with strict security needs.
Based on end-use sector, the market is segmented into government & public services, energy & utilities, BFSI, healthcare & life sciences, transportation & logistics, real estate & retail, telecommunications, education, and others. Government & public services is expected to account for the largest share in 2026, because federal and emirate authorities have led AI adoption since the 2017 national strategy, appointed chief AI officers, and are building AI into licensing, transport, healthcare, and customer service. Healthcare & life sciences is expected to grow at the highest CAGR, supported by AI in diagnostics, genomics, and personalized medicine, including M42's role in national genomics programs. Energy & utilities is another major sector, as ADNOC uses AI for exploration, production optimization, and maintenance through AIQ.
Based on enterprise size, the market is segmented into large enterprises & government entities and small & medium-sized enterprises. Large enterprises & government entities are expected to account for the larger share in 2026, since government bodies, state-owned companies, and major corporations fund the largest infrastructure, platform, and sovereign cloud programs and have the budgets and data assets to run them. Small & medium-sized enterprises are expected to register the higher CAGR, as cloud-based AI tools lower the cost of entry and nationwide access to generative AI services brings AI within reach of smaller businesses without in-house data science teams.
Regional Analysis
The report analyzes the market across Abu Dhabi, Dubai, Sharjah, and the Northern Emirates, with the Northern Emirates further split into Ajman, Ras Al Khaimah, Fujairah, and Umm Al Quwain. The emirate-level analysis weighs data center capacity, sovereign capital, research institutions, government AI programs, free zone rules, power, and connectivity.Abu Dhabi is expected to lead the UAE artificial intelligence market in 2026, as most of the country's AI infrastructure, sovereign capital, and research base sit in the emirate. The emirate is the site of the UAE-US AI Campus and Stargate UAE, and it is home to G42 and its subsidiaries, MGX, MBZUAI, and the Technology Innovation Institute. ADNOC's AI programs through AIQ, the ADGM free zone and its data protection framework, and power from the 5.6-gigawatt Barakah nuclear plant add to the emirate's position.
Dubai is expected to grow at the highest CAGR during the forecast period, backed by a dense mix of corporates, banks, and multinationals and by active government AI programs. The Dubai Universal Blueprint for Artificial Intelligence, launched in 2024, placed chief AI officers across government entities, and the emirate runs the Dubai Centre for Artificial Intelligence and the Dubai AI Campus in DIFC. An autonomous mobility target for 2030 and AI use by Emirates and DP World add demand in aviation and logistics. Sharjah holds a moderate share, built on AI research and training at the American University of Sharjah and the University of Sharjah, startups in the Sharjah Research, Technology and Innovation Park, and digitized public services. The Northern Emirates are expected to grow strongly from a smaller base, with Fujairah serving as a major subsea cable landing point, Ras Al Khaimah developing technology and digital asset free zones, and federal programs extending AI access and education to all seven emirates.
Competitive Landscape
The report provides a detailed review of the competitive landscape, covering key growth strategies, competitive benchmarking, the competitive dashboard with industry leaders, market differentiators, vanguards, and emerging companies, and market share/rank analysis for 2025. Company profiles cover each player's business overview, financial overview, product portfolio, strategic developments, and SWOT analysis.The market brings together national AI leaders and their group companies, sovereign funds, telecom and data center operators, global cloud, model, and chip suppliers, research institutes, and a growing number of startups. Companies compete and collaborate on access to compute and chips, model quality including Arabic performance, sovereign and secure deployment, sector knowledge, and compliance with export controls and data rules. Leading players are building sovereign AI infrastructure, releasing open and Arabic models, setting up joint ventures with large UAE companies such as ADNOC, and partnering with global technology firms. Notable developments include Microsoft's 2024 investment in G42, which came with G42 moving workloads to Azure and exiting Chinese hardware suppliers, the 2025 launch of Stargate UAE as the first project under OpenAI for Countries, and the U.S. approval of chip export licenses for G42 in November 2025.
Key companies profiled in the report include G42 (UAE), Core42 (UAE), Presight AI Holding PLC (UAE), AIQ (UAE), M42 (UAE), Space42 PLC (UAE), Khazna Data Centers (UAE), MGX (UAE), Technology Innovation Institute (UAE), e& (Emirates Telecommunications Group Company PJSC) (UAE), Emirates Integrated Telecommunications Company PJSC (du) (UAE), Microsoft Corporation (U.S.), OpenAI (U.S.), Oracle Corporation (U.S.), NVIDIA Corporation (U.S.), Cerebras Systems Inc. (U.S.), and Amazon Web Services, Inc. (U.S.).
How This Report Helps
- Provides reliable market size estimates and long-term forecasts for the UAE artificial intelligence market through 2036.
- Explains how national AI strategy, sovereign capital, and the Stargate UAE build-out are shaping AI spending in the country.
- Assesses the impact of chip export approvals, talent shortages, power and cooling needs, and data governance on market growth.
- Identifies high-growth opportunities across component, technology, deployment, end-use sector, enterprise size, and emirate.
- Tracks developments in sovereign cloud, Arabic language models, generative AI adoption, and AI-first government services.
- Benchmarks national AI companies, telecom operators, and global technology partners on offerings, partnerships, and market position.
- Supports market entry, partnership, investment, and product planning decisions for technology vendors, data center operators, investors, and public sector buyers.
Key Questions Answered
- How large is the UAE artificial intelligence market today, and how will it grow through 2036?
- How will the UAE-US AI Campus and Stargate UAE change demand for AI infrastructure, software, and services?
- What are the main drivers, restraints, opportunities, challenges, and trends shaping the market?
- How do U.S. export controls and the U.S.-UAE AI Acceleration Partnership affect access to advanced chips?
- Which component, technology, deployment, end-use sector, and enterprise size segments will grow the fastest?
- What role will Arabic language and sovereign AI models play in domestic and regional demand?
- Which emirates offer the most attractive opportunities, and what is driving growth in each?
- Who are the leading companies in the market, and how do they compare?
- What investments, partnerships, and joint ventures are shaping competition?
Table of Contents
1. Introduction
2. Research Methodology
4. Market Overview
5. UAE Artificial Intelligence Market, by Component
6. UAE Artificial Intelligence Market, by Technology
7. UAE Artificial Intelligence Market, by Deployment
8. UAE Artificial Intelligence Market, by End-Use Sector
9. UAE Artificial Intelligence Market, by Enterprise Size
10. UAE Artificial Intelligence Market, by Emirate
11. Competitive Landscape
12. Company Profiles
13. Appendix
LIST OF TABLES
LIST OF FIGURES
Companies Mentioned
- G42
- Core42
- Presight AI Holding PLC
- AIQ
- M42
- Space42 PLC
- Khazna Data Centers
- MGX
- Technology Innovation Institute
- e&
- Emirates Integrated Telecommunications Company PJSC
- Microsoft Corporation
- OpenAI
- Oracle Corporation
- NVIDIA Corporation
- Cerebras Systems Inc.
- Amazon Web Services, Inc.
