Cloud AI Market Size | Industry Trends & Forecast Analysis

Name: Cloud AI Market Size | Industry Trends & Forecast Analysis
Creator: Mordor Intelligence
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Cloud AI Market Size and Share

Market Overview

Study Period	2019 - 2030
Market Size (2025)	USD 89.43 Billion
Market Size (2030)	USD 363.44 Billion
Growth Rate (2025 - 2030)	32.37% CAGR
Fastest Growing Market	Asia Pacific
Largest Market	North America
Market Concentration	Medium
Major Players *Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0.

Cloud AI Market Summary — Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0.

Cloud AI Market Analysis by Mordor Intelligence

The Cloud AI market reached USD 89.43 billion in 2025 and is forecast to advance to USD 363.44 billion by 2030, reflecting a 32.37% CAGR.^{[1]Microsoft, “Microsoft 2024 Annual Report,” Microsoft.com} Generative AI partnerships, such as Microsoft’s USD 13 billion commitment to OpenAI and Amazon’s USD 8 billion investment in Anthropic, are expanding capacity, lowering entry barriers, and accelerating time-to-value for enterprises.^{[2]Amazon Web Services, “AWS plans to invest 2.26 trillion yen into its Japanese cloud infrastructure by 2027,” Amazonaws.com} Mid-market adoption is rising as GPU-fractionalization technologies reduce infrastructure costs, while sector-specific regulations in healthcare and financial services favor providers that can demonstrate robust governance. Supply-chain dynamics, notably in high-bandwidth memory, spur chip diversification strategies among hyperscalers, and carbon-aware workload orchestration begins to influence data-center siting decisions.

Key Report Takeaways

By type, Solutions held 63% of the Cloud AI market share in 2024, while Services are projected to expand at 33.98% CAGR to 2030.
By end-user vertical, BFSI led with 29% revenue share in 2024; Healthcare is forecast to rise at a 35.61% CAGR through 2030.
By deployment model, Public Cloud dominated with 71% share of the Cloud AI market size in 2024, whereas Hybrid/Multi-cloud is advancing at 33.11% CAGR.
By application, Customer Service and Contact-Centre AI accounted for 36.05% share of the Cloud AI market size in 2024; Marketing and Personalisation is growing at 32.53% CAGR to 2030.
By technology, Machine Learning commanded 34.60% Cloud AI market share in 2024, and Natural Language Processing is set to climb at 38.71% CAGR.
By region, North America held 41% of revenue in 2024, while Asia Pacific is expected to register a 32.41% CAGR through 2030.

Global Cloud AI Market Trends and Insights

Drivers Impact Analysis

Driver	(~) % Impact on CAGR Forecast	Geographic Relevance	Impact Timeline
Rising big-data volume	+8.2%	Global, led by North America and APAC	Medium term (2–4 years)
Growing adoption of AI-as-a-Service	+9.1%	Global, led by North America and Europe	Short term (≤ 2 years)
Increasing demand for virtual assistants and GenAI chatbots	+6.8%	Global, early uptake in North America and APAC	Short term (≤ 2 years)
GenAI GPU-fractionalization expanding SME access	+4.3%	Global, strong in emerging markets	Medium term (2–4 years)
Edge–cloud AI interoperability standards	+2.9%	Global, manufacturing hubs	Long term (≥ 4 years)
Carbon-aware workload orchestration incentives	+1.4%	Europe and North America, expanding to APAC	Long term (≥ 4 years)

Source: Mordor Intelligence

Growing Adoption of AI-as-a-Service (AIaaS)

Enterprises are shifting from capital-heavy on-premises deployments to pay-as-you-go AI services. Microsoft’s AI business reached a USD 13 billion annual run rate in Q2 FY 2025, contributing 16 percentage points to Azure growth. Custom silicon such as AWS Trainium2 delivers 30-40% price-performance gains, broadening AI accessibility for mid-market firms that must meet regional data-sovereignty rules. Uptake is evident across Europe and Asia, where 60% of mid-size enterprises expect regionally trained language models by 2025.

Rising Big-Data Volume

Unstructured data exceeds 80% of enterprise information assets, driving demand for real-time AI analytics. Healthcare use cases include Mayo Clinic processing genomic records from 100,000 patients to improve early disease detection. Financial services apply cloud AI to reduce false positives in anti-money-laundering screening by 95%. Edge-cloud convergence allows manufacturers to perform predictive maintenance on IoT data streams with millisecond response times.

Increasing Demand for Virtual Assistants and GenAI Chatbots

Conversational AI is scaling from simple chatbots to multimodal agents that complete complex workflows. Goldman Sachs deployed its GS AI Assistant to 10,000 staff, cutting document-creation time from hours to minutes. Microsoft’s Copilot Wave 2 introduces Researcher and Analyst agents capable of multi-step data analysis across Microsoft 365 applications.^{[3]World Wide Technology, “Microsoft 365 Copilot Wave 2: Spring 2025 Release Overview,” Wwt.com} Healthcare providers employ ambient listening systems that chart patient records without manual entry, freeing nursing time for direct care.

GenAI GPU-Fractionalization Expanding SME Access

Fractional GPU consumption models reduce experimentation costs by up to 70% compared with dedicated hardware. Oracle Cloud Infrastructure now supports fractional access to clusters of up to 64,000 NVIDIA Blackwell GPUs, enabling startups to train advanced models without marquee budgets. Manufacturing surveys show 93% of firms launched new AI projects in 2024, though only 20% completed rollouts owing to integration complexity.

Restraints Impact Analysis

Restraint	(~) % Impact on CAGR Forecast	Geographic Relevance	Impact Timeline
Lack of skilled workforce and data-security concerns	−6.4%	Global, acute in APAC and emerging markets	Medium term (2–4 years)
Persistent GPU/HBM supply-chain shortages	−4.7%	Global, concentrated in Asian manufacturing	Short term (≤ 2 years)
AI datacenter energy constraints and carbon regulations	−3.2%	Europe and North America, expanding globally	Long term (≥ 4 years)
Geopolitical GPU export-control frameworks	−2.8%	China, Russia, select emerging markets	Medium term (2–4 years)

Source: Mordor Intelligence

Persistent GPU/HBM Supply-Chain Shortages

SK Hynix controls 70% of the HBM market and reports full allocation through 2025, creating cost pressures for cloud providers.^{[4]South China Morning Post, “Nvidia supplier SK Hynix says 2025 HBM chips for AI processors nearly sold out,” Scmp.com} AWS counters with Trainium custom chips, while Oracle procures thousands of NVIDIA Blackwell GPUs to sustain training capacity. Tight memory supply has triggered price spikes in DDR5 and VRAM, with Samsung inking a USD 3 billion HBM3E supply deal with AMD.

Lack of Skilled Workforce and Data-Security Concerns

A global talent deficit inflates AI engineer salaries by up to 50%, and regulated sectors face shortages in model-governance expertise. JPMorgan Chase employs more than 2,000 AI specialists yet still cites gaps in explainability skills. The EU AI Act classifies most healthcare AI tools as high-risk, intensifying compliance burdens that demand scarce legal and technical knowledge.

Segment Analysis

By Type: Services Scale on Advisory Demand

Solutions represented 63% of the Cloud AI market in 2024. Enterprises gravitated to packaged platforms that integrate with existing DevOps pipelines, ensuring quick deployment and consistent performance. As adoption deepens, professional guidance becomes essential for migration roadmaps and governance, pushing the Services segment to a forecast 33.98% CAGR.

Services growth reflects multi-year transformation programs that include strategy, model tuning, and managed operations. Firms such as Accenture have retrained 1,400 engineers for Anthropic-on-AWS implementations, directly addressing enterprise skills gaps. Combined solution-service offerings are growing in popularity, enabling organizations to onboard AI quickly while building internal competencies.

By End-User Vertical: Healthcare Surges

BFSI held 29% Cloud AI market share in 2024 due to fraud analytics and robo-advisory use cases. However, Healthcare is set to grow at 35.61% CAGR, buoyed by AI-enabled diagnostics and ambient clinical documentation.

Hospitals deploy large language models for radiology triage and personalized treatment recommendations. The FDA’s January 2025 guidance provides a clear regulatory path, encouraging capital investment. Manufacturing and retail follow, leveraging AI for defect detection and inventory optimization, respectively.

By Deployment Model: Hybrid Rises for Flexibility

Public Cloud controlled 71% of the Cloud AI market size in 2024 thanks to hyperscale economies and a broad services catalog. Yet, Hybrid/Multi-cloud is projected to grow 33.11% CAGR as firms balance cost, sovereignty, and resilience.

Oracle’s MultiCloud database revenue more than doubled year-over-year, illustrating customer appetite for distributing workloads across vendors. Providers are enhancing direct interconnects and policy-based data controls to smooth hybrid operations and minimize egress fees.

By Application: Personalised Marketing Gains SpeeD

Customer Service and Contact-Centre AI accounted for 36.05% of the Cloud AI market size in 2024, driven by conversational agents that shorten handling times and boost satisfaction. Marketing and Personalisation will expand 32.53% CAGR as brands deploy recommendation models to tailor offers in real time.

Retailers embed AI in campaign orchestration systems that analyze click-stream data within seconds, improving conversion rates. Manufacturing and energy sectors continue to expand predictive-maintenance deployments, capturing gains in uptime and safety.

By Technology: NLP Outpaces for GenAI

Machine Learning secured 34.60% Cloud AI market share in 2024, underpinning classic forecasting and optimization. Natural Language Processing is set to grow 38.71% CAGR on the back of generative models that create, summarize, and translate content at scale.

Multimodal architectures weave NLP with computer vision and speech to deliver richer interactions, while reinforcement learning optimizes sequential decision tasks in logistics and finance. Vendors differentiate with domain-tuned language models that embed privacy and bias-mitigation techniques.

Geography Analysis

North America retained 41% Cloud AI market share in 2024, anchored by hyperscaler footprints and venture funding. Regulatory clarity, exemplified by the FDA’s AI device guidelines, encourages adoption across life-sciences and finance. Capital outlays include Amazon’s USD 8 billion Anthropic investment and Microsoft’s continued OpenAI integration, reinforcing regional dominance.

Asia Pacific is the fastest-growing territory with 32.41% CAGR. China’s projected USD 46 billion cloud spend for 2025, along with Alibaba’s multi-year capex commitment, fuels infrastructure expansion. Japan accelerates with Oracle’s USD 8 billion pledge and Tokyo’s selection for OpenAI’s first Indo-Pacific branch. India and Southeast Asia benefit from digital public-infrastructure programs and rising developer communities.

Europe shows steady growth amid complex regulation. The EU AI Act provides a harmonized framework that advantages providers with certified governance. Sovereign cloud initiatives and carbon-reduction mandates encourage hybrid architectures. Emerging markets in the Middle East and Africa witness early uptake, backed by sovereign-wealth investments in data centers.

Cloud AI Market CAGR (%), Growth Rate by Region — Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0.

Competitive Landscape

Competition centers on hyperscalers racing to integrate proprietary silicon, large models, and vertical solutions. AWS leverages its Trainium/Inferentia roadmap to drive cost efficiency, complemented by a USD 8 billion Anthropic pact. Microsoft embeds OpenAI capabilities across Azure and Microsoft 365, delivering a USD 13 billion annual run rate for AI services. Google Cloud counters with Trillium TPUs that quadruple training throughput

Oracle positions on high-performance clusters, procuring thousands of NVIDIA Blackwell GPUs, and announcing a USD 40 billion chip spend for OpenAI’s Texas installation. Supply-chain fragility in HBM memory pressures all players, prompting multi-vendor agreements and in-house chip projects.

Specialist providers exploit white spaces in regulated verticals, edge-cloud orchestration, and compliance automation. Consolidation continues through strategic investments and ecosystem alliances that marry infrastructure with model innovation.

Cloud AI Industry Leaders

Amazon Web Services Inc.
Microsoft Corporation
Google LLC
IBM Corporation
Intel Corporation
*Disclaimer: Major Players sorted in no particular order

Cloud AI Market Concentration — Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0.

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Recent Industry Developments

June 2025: Oracle will invest over USD 40 billion in NVIDIA chips for OpenAI’s Texas data center
June 2025: OpenAI signed a cloud partnership with Google Cloud to diversify compute sources
May 2025: Microsoft released Copilot Wave 2 with Researcher and Analyst agents
April 2025: SK Hynix posted record quarterly profit on HBM demand, holding 70% share

Table of Contents for Cloud AI Industry Report

1. INTRODUCTION

1.1 Study Assumptions and Market Definition
1.2 Scope of the Study

2. RESEARCH METHODOLOGY

3. EXECUTIVE SUMMARY

4. MARKET LANDSCAPE

4.1 Market Overview
4.2 Market Drivers
- 4.2.1 Rising big-data volume
- 4.2.2 Growing adoption of AI-as-a-Service (AIaaS)
- 4.2.3 Increasing demand for virtual assistants and GenAI chatbots
- 4.2.4 GenAI GPU-fractionalization expanding SME access
- 4.2.5 Edge-cloud AI interoperability standards (e.g., ONNX, MEDAL)
- 4.2.6 Carbon-aware workload orchestration incentives
4.3 Market Restraints
- 4.3.1 Lack of skilled workforce and data-security concerns
- 4.3.2 Persistent GPU/HBM supply-chain shortages
- 4.3.3 AI datacentre energy constraints and carbon regulations
- 4.3.4 Geopolitical GPU export-control frameworks
4.4 Value Chain Analysis
4.5 Regulatory Landscape
4.6 Technological Outlook
4.7 Porter's Five Forces Analysis
- 4.7.1 Threat of New Entrants
- 4.7.2 Bargaining Power of Suppliers
- 4.7.3 Bargaining Power of Buyers
- 4.7.4 Threat of Substitutes
- 4.7.5 Intensity of Competitive Rivalry

5. MARKET SIZE AND GROWTH FORECASTS (VALUE)

5.1 By Type
- 5.1.1 Solution
- 5.1.2 Service
5.2 By End-user Vertical
- 5.2.1 BFSI
- 5.2.2 Healthcare
- 5.2.3 Automotive and Mobility
- 5.2.4 Retail and E-commerce
- 5.2.5 Government and Public Sector
- 5.2.6 Education
- 5.2.7 Manufacturing
5.3 By Deployment Model
- 5.3.1 Public Cloud
- 5.3.2 Private Cloud
- 5.3.3 Hybrid / Multi-cloud
5.4 By Application
- 5.4.1 Customer Service and Contact-Centre AI
- 5.4.2 Predictive Maintenance and Asset Ops
- 5.4.3 Fraud and Risk Analytics
- 5.4.4 Marketing and Personalisation
- 5.4.5 Computer-Vision-as-a-Service
5.5 By Technology
- 5.5.1 Machine Learning
- 5.5.2 Natural Language Processing
- 5.5.3 Computer Vision
- 5.5.4 Generative AI
- 5.5.5 Reinforcement and Edge AI
5.6 By Geography
- 5.6.1 North America
- 5.6.1.1 United States
- 5.6.1.2 Canada
- 5.6.1.3 Mexico
- 5.6.2 South America
- 5.6.2.1 Brazil
- 5.6.2.2 Argentina
- 5.6.2.3 Chile
- 5.6.2.4 Rest of South America
- 5.6.3 Europe
- 5.6.3.1 Germany
- 5.6.3.2 United Kingdom
- 5.6.3.3 France
- 5.6.3.4 Italy
- 5.6.3.5 Spain
- 5.6.3.6 Netherlands
- 5.6.3.7 Russia
- 5.6.3.8 Rest of Europe
- 5.6.4 Asia Pacific
- 5.6.4.1 China
- 5.6.4.2 India
- 5.6.4.3 Japan
- 5.6.4.4 South Korea
- 5.6.4.5 ASEAN
- 5.6.4.6 Rest of Asia Pacific
- 5.6.5 Middle East and Africa
- 5.6.5.1 Middle East
- 5.6.5.1.1 GCC (Saudi Arabia, UAE, Qatar, etc.)
- 5.6.5.1.2 Turkey
- 5.6.5.1.3 Rest of Middle East
- 5.6.5.2 Africa
- 5.6.5.2.1 South Africa
- 5.6.5.2.2 Nigeria
- 5.6.5.2.3 Kenya
- 5.6.5.2.4 Rest of Africa

6. COMPETITIVE LANDSCAPE

6.1 Market Concentration
6.2 Strategic Moves
6.3 Market Share Analysis
6.4 Company Profiles (includes Global level Overview, Market level overview, Core Segments, Financials as available, Strategic Information, Market Rank/Share for key companies, Products and Services, and Recent Developments)
- 6.4.1 Amazon Web Services
- 6.4.2 Microsoft Corp.
- 6.4.3 Google LLC
- 6.4.4 IBM Corp.
- 6.4.5 Salesforce Inc.
- 6.4.6 NVIDIA Corp.
- 6.4.7 Oracle Corp.
- 6.4.8 Alibaba Cloud
- 6.4.9 SAP SE
- 6.4.10 ServiceNow
- 6.4.11 Databricks
- 6.4.12 Snowflake Inc.
- 6.4.13 Hugging Face
- 6.4.14 OpenAI LP
- 6.4.15 Anthropic PBC
- 6.4.16 CoreWeave
- 6.4.17 AMD Inc.
- 6.4.18 Intel Corp.
- 6.4.19 Wipro Ltd.
- 6.4.20 Infosys Ltd.
- 6.4.21 SoundHound AI Inc.
- 6.4.22 Twilio Inc.

7. MARKET OPPORTUNITIES AND FUTURE OUTLOOK

7.1 White-space and Unmet-need Assessment

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Global Cloud AI Market Report Scope

An AI cloud comprises a shared infrastructure for AI use cases, simultaneously supporting several projects and AI workloads. The AI cloud pools various hardware and software resources to deliver AI software-as-a-service (SaaS) on cloud infrastructure, providing enterprises access to key AI capabilities. As such, the study tracks revenues accrued from off-the-shelf AI tools that are offered through cloud technologies. The study also considers revenues accrued from training, consulting, and system integration services for Cloud AI.

The study is segmented by type (Solution, Services), end-user industry (BFSI, Healthcare, Automotive, Retail, Government, and Education, among others), and geography (North America, Europe, Asia Pacific, Latin America, and Middle East and Africa).

The market sizes and forecasts are provided regarding value (USD billion) for all the above segments.

By Type	Solution
	Service
By End-user Vertical	BFSI
	Healthcare
	Automotive and Mobility
	Retail and E-commerce
	Government and Public Sector
	Education
	Manufacturing
By Deployment Model	Public Cloud
	Private Cloud
	Hybrid / Multi-cloud
By Application	Customer Service and Contact-Centre AI
	Predictive Maintenance and Asset Ops
	Fraud and Risk Analytics
	Marketing and Personalisation
	Computer-Vision-as-a-Service
By Technology	Machine Learning
	Natural Language Processing
	Computer Vision
	Generative AI
	Reinforcement and Edge AI

By Geography	North America	United States
		Canada
		Mexico

	South America	Brazil
		Argentina
		Chile
		Rest of South America

	Europe	Germany
		United Kingdom
		France
		Italy
		Spain
		Netherlands
		Russia
		Rest of Europe

	Asia Pacific	China
		India
		Japan
		South Korea
		ASEAN
		Rest of Asia Pacific

	Middle East and Africa	Middle East	GCC (Saudi Arabia, UAE, Qatar, etc.)
			Turkey
			Rest of Middle East

		Africa	South Africa
			Nigeria
			Kenya
			Rest of Africa

By Type

Solution

Service

By End-user Vertical

BFSI

Healthcare

Automotive and Mobility

Retail and E-commerce

Government and Public Sector

Education

Manufacturing

By Deployment Model

Public Cloud

Private Cloud

Hybrid / Multi-cloud

By Application

Customer Service and Contact-Centre AI

Predictive Maintenance and Asset Ops

Fraud and Risk Analytics

Marketing and Personalisation

Computer-Vision-as-a-Service

By Technology

Machine Learning

Natural Language Processing

Computer Vision

Generative AI

Reinforcement and Edge AI

By Geography

North America	United States
	Canada
	Mexico
South America	Brazil
	Argentina
	Chile
	Rest of South America
Europe	Germany
	United Kingdom
	France
	Italy
	Spain
	Netherlands
	Russia
	Rest of Europe
Asia Pacific	China
	India
	Japan
	South Korea
	ASEAN
	Rest of Asia Pacific

Middle East and Africa	Middle East	GCC (Saudi Arabia, UAE, Qatar, etc.)
		Turkey
		Rest of Middle East

	Africa	South Africa
		Nigeria
		Kenya
		Rest of Africa

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Key Questions Answered in the Report

What is the current size of the Cloud AI market?

The Cloud AI market stands at USD 89.43 billion in 2025 and is projected to reach USD 363.44 billion by 2030.

Which sector is growing fastest within the Cloud AI market?

Healthcare leads growth with a 35.61% CAGR through 2030, propelled by diagnostic, ambient listening, and personalized-medicine applications.

Why are hybrid deployments gaining traction?

Hybrid architectures let organizations balance cost control, data-sovereignty compliance, and resilience, driving a 33.11% CAGR for Hybrid/Multi-cloud deployments.

How are supply-chain constraints affecting Cloud AI?

Limited HBM memory capacity raises infrastructure costs and spurs hyperscalers to develop custom chips and long-term vendor agreements.

What technologies are advancing fastest?

Natural Language Processing, closely tied to generative AI, is expected to expand at 38.71% CAGR as enterprises embed conversational agents across workflows.

Which regions will contribute most to future growth?

Asia Pacific, led by China, Japan, and India, is forecast to record a 32.41% CAGR on the strength of sovereign AI initiatives and large-scale infrastructure investments.

Page last updated on: July 7, 2025