AI Chipset Market Analysis and Global Forecast 2023-2033

AI Chipset Market Overview

The AI Chipset Market Size is expected to reach USD 228.65 Billion by 2033. The AI Chipset industry size accounted for USD 16.87 Billion in 2023 and is expected to expand at a compound annual growth rate (CAGR) of 37.87% from 2023 to 2033. AI An AI chipset refers to a specialized integrated circuit or a set of integrated circuits designed to perform artificial intelligence (AI) tasks efficiently. It comprises various components and architectures optimized for accelerating AI workloads, such as machine learning and deep learning algorithms. The AI chipset typically consists of multiple processing units, including CPUs (central processing units), GPUs (graphics processing units), NPUs (neural processing units), or dedicated AI accelerators. The AI chipset’s design and organization prioritize high-speed computation, parallel processing capabilities, and optimized power consumption to enable faster and more efficient execution of AI algorithms. These chipsets often incorporate advanced features like tensor processing units, vector processing units, or specialized AI instruction sets that facilitate the execution of complex mathematical calculations and data manipulation required by AI applications.

Global AI Chipset Market Synopsis

COVID-19 Impact Analysis

The COVID-19 pandemic had a profound and transformative impact on the AI Chipset market. With the sudden surge in remote work, increased reliance on digital platforms, and growing demand for healthcare solutions, there was a heightened need for advanced AI capabilities. This led to a surge in the adoption of AI technologies, driving the demand for AI chipsets. Industries such as healthcare, e-commerce, and logistics experienced accelerated digital transformation, resulting in increased investments in AI infrastructure. Additionally, the pandemic highlighted the importance of data analysis and AI-driven insights for effective decision-making and crisis management. As a result, AI chipset manufacturers witnessed a surge in demand, prompting them to innovate and develop more powerful and efficient chipsets to meet the evolving market requirements. The pandemic acted as a catalyst, accelerating the growth and development of the AI Chipset market and paving the way for its continued expansion in various industries.

AI Chipset Market Dynamics

The major factors that have impacted the growth of AI Chipset are as follows:

Drivers:

Increasing Adoption of AI Technologies

The primary driver of the AI chipset market is the widespread adoption of AI technologies across various industries. Organizations are leveraging AI for tasks such as data analysis, machine learning, and deep learning to gain insights, enhance productivity, and improve decision-making processes. This increasing demand for AI applications fuels the need for powerful and efficient AI chipsets that can handle complex computations and accelerate AI workloads.

Restraint:

• Technological Challenges and Complexity

One of the key restraints in the AI chipset market is the inherent technical challenges and complexity associated with developing and integrating AI chipsets. Designing and manufacturing advanced chipsets that can handle complex AI algorithms requires significant expertise and investment. Additionally, the rapid advancements in AI technologies often outpace the development of chipsets, creating compatibility issues and requiring frequent updates and optimizations.

Opportunity:

⮚      Edge Computing and IoT Applications

An opportunity for the AI chipset market lies in the growth of edge computing and Internet of Things (IoT) applications. Edge computing involves processing data at the edge of the network, closer to the data source, rather than relying on centralized cloud servers. AI chipsets with low power consumption, high computational capabilities, and efficient processing can enable real-time AI inference and decision-making at the edge. The increasing deployment of AI-enabled IoT devices and applications, such as smart homes, autonomous vehicles, and industrial automation, presents a significant opportunity for AI chipsets to drive intelligence and enhance efficiency in these domains.

AI Chipset Segment Overview

By Component

Based on Component, the market is segmented based on Central Processing Unit (CPU), Graphics Processing Unit (GPU), Neural Network Processor (NNP), and Others. The Central Processing Unit (CPU) segment is expected to have a larger market share throughout the forecast period. CPUs are versatile and widely used for general-purpose computing, making them a common choice for AI applications. They offer high-performance processing capabilities and can handle a wide range of tasks, including AI workloads. CPU manufacturers have been investing in optimizing their architectures for AI, incorporating features like vector instructions and enhanced parallel processing capabilities.

By Application

Based on Application, the market has been divided into Consumer Electronics, Automotive, Healthcare, Automation and Robotics, and Others. The Consumer Electronics segment is anticipated to dominate the market. The increasing demand for smart and connected devices, coupled with the rising consumer expectations for enhanced user experiences and personalized services, has led to higher adoption of AI chipsets in the consumer electronics segment. Manufacturers are leveraging AI chipsets to enable functionalities like facial recognition for device unlocking, voice-based commands for smart assistants, intelligent camera features, and predictive analytics for personalized recommendations.

Global AI Chipset Market Regional Analysis

Based on region, the global AI Chipset market has been divided into North America, Europe, Asia-Pacific, the Middle East & Africa, and Latin America. North America is projected to dominate the use of the AI Chipset market followed by the Asia-Pacific and Europe regions.

North America Market

North America has consistently held a dominant position in the AI Chipset market. Several factors contribute to North America’s strong presence in this market. North America is home to major technology hubs and leading AI chipset manufacturers, such as NVIDIA, Intel, and AMD. These companies have been at the forefront of developing and commercializing AI chipsets, driving innovation in the industry. Their strong presence and expertise in AI technologies have contributed to North America’s dominance. North America has a robust ecosystem of AI research and development, with renowned universities and research institutions focusing on AI advancements. This creates a fertile environment for fostering innovation, attracting talent, and conducting cutting-edge research in AI chipsets.

Asia-Pacific Market

The Asia-Pacific region has indeed emerged as a rapidly growing market for the AI Chipset industry. The region is witnessing substantial growth due to various factors. Asia-Pacific countries, including China, South Korea, and Japan, have made significant investments in AI research and development, fostering technological advancements and innovation in AI chipsets. The region’s large population, increasing disposable income, and rising adoption of smart devices and IoT technologies are driving the demand for AI-enabled consumer electronics and smart appliances, fueling the growth of the AI Chipset market. Additionally, Asia-Pacific countries are embracing AI technologies in sectors such as healthcare, manufacturing, and automotive, creating a favorable environment for the deployment of AI chipsets. The region’s fast-paced digital transformation and the presence of major technology companies are contributing to its rapid emergence as a significant market player in the AI Chipset industry.

Competitive Landscape

The Global AI Chipset market is highly competitive, with numerous players offering a wide range of software solutions. The competitive landscape is characterized by the presence of established companies, as well as emerging startups and niche players. To increase their market position and attract a wide consumer base, the businesses are employing various strategies, such as product launches, and strategic alliances.

Prominent Players:

• Advanced Micro Devices Inc. (AMD)
• Xilinx Inc
• Graphcore Ltd
• Huawei Technologies Co. Ltd
• IBM Corporation
• Intel Corporation
• NVIDIA Corporation
• Micron Technology Inc
• Samsung Semiconductor

Key Development

In May 2022, Intel introduced two new deep-learning processors, namely Habana Gaudi2 and Habana GrecoTM. These processors address a market gap by providing clients with efficient and high-performance computing options for deep learning instruction and inference tasks. They are designed for deployment in data centers, enabling simultaneous training and inference applications. This advancement aims to make AI more accessible to businesses of all sizes, reducing the barriers to entry for adopting AI technologies.

In February 2022, Celestial AI, an AI accelerator company specializing in machine learning chipsets, announced a Series A investment of USD 56 million. The funding will be utilized for product development and strategic engagements with suppliers, including Broadcom. Celestial AI’s proprietary hardware and software platform for machine learning chipsets positions them to leverage this investment for further enhancing their products and expanding their market presence.

Scope of the Report

Global AI Chipset Market, by Component

• Central Processing Unit (CPU)
• Graphics Processing Unit (GPU)
• Neural Network Processor (NNP)
• Other

Global AI Chipset Market, by Application

• Consumer Electronics
• Automotive
• Healthcare
• Automation and Robotics
• Other

Global AI Chipset Market, by Region

• North America
  • US
  • Canada
  • Mexico
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Benelux
  • Nordic
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • South Korea
  • Indonesia
  • Austalia
  • Malaysia
  • India
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • Egypt
  • South Africa
  • Rest of Middle East & Africa

REPORT CONTENT BRIEF:

• High-level analysis of the current and future AI Chipset market trends and opportunities
• Detailed analysis of current market drivers, restraining factors, and opportunities in the future
• AI Chipset market historical market size for the year 2021, and forecast from 2023 to 2033
• AI Chipset market share analysis at each product level
• Competitor analysis with detailed insight into its product segment, Government & Defense strength, and strategies adopted.
• Identifies key strategies adopted including product launches and developments, mergers and acquisitions, joint ventures, collaborations, and partnerships as well as funding taken and investment done, among others.
• To identify and understand the various factors involved in the global AI Chipset market affected by the pandemic
• To provide a detailed insight into the major companies operating in the market. The profiling will include the Government & Defense health of the company’s past 2-3 years with segmental and regional revenue breakup, product offering, recent developments, SWOT analysis, and key strategies.