Artificial Intelligence Chipsets Market Size, Share & COVID-19 Impact Analysis, By Chipset Type (Graphics Processing Unit (GPU), Field Programmable Gate Arrays (FPGAs)), By Application (Natural Language Processing (NLP), Robotic Process Automation (RPA), Machine Learning), By Computing Technology (Cloud Computing and Edge Computing), By Function (Training and Inference), By Industry and Regional Forecast, 2020-2027

The global artificial intelligence chipsets market size was USD 8.14 billion in 2019 and is projected to reach USD 108.85 billion by 2027, exhibiting a CAGR of 38.9% during the forecast period.

Artificial intelligence (AI) chipsets are silicon-based chipsets that are enabled with AI technology, that offer high computing capabilities to connected devices such as laptops, smart wearable, smartphones, among others. AI chips enhance the operational performance of the device with advanced analytical functions, virtual reality (VR), and augmented reality (AR), and improves the user experience.

Major drivers for the artificial intelligence (AI) chipset market are the advancement of semiconductor nanowire laser technology, 3D technology, and the growing adoption of neural networks & deep learning technologies. In addition, the growing number of smart cities, smart buildings, and smart home projects across the globe are likely to fuel the demand for chipsets. Key players are more focused on developing advanced artificial intelligence chipsets for multifaceted applications.

• For instance, in August 2020, Kneron launched its advanced AI chipset - "Kneron KL 720 SoC". The aim is to offer a comprehensive and cost-effective suite of AI chipsets for devices across the globe.

COVID-19 Impact

COVID-19 Outbreak to Motivate Enterprises towards AI-based Solutions

The pandemic has adversely impacted the market and will continue to affect to a certain extent in the forthcoming years. This is attributed to the affected supply chain processes, manufacturing sector, and partial adoption of AI in emerging industries. Owing to the lockdown guidelines, various manufacturing organizations have stopped their production process, which has consequently damaged the supply chain process across the globe.  

According to the index of industrial production (IIP) data, in 2020, the manufacturing sector production registered a decline of 11.1% in July, as covid-19 lockdown slows down the manufacturing process. This outbreak has caused a delay in the adoption of AI-based hardware and software products. Various industries such as automotive, manufacturing, and others. are worse hit by this crisis, but several other industry verticals such as healthcare manufacturing, medical devices, and others are profiting from this global crisis. To overcome such challenges, key market players are focusing on launching advanced AI-based solutions to cater to the rising consumer demand.

• For instance, in May 2020, Nvidia Corporation expanded its EGX Edge AI platform by launching new products such as the EGX Jetson Xavier NX and EGX A100. The aim is to deliver secured AI processing and high-performance at the edge. This platform is designed to provide real-time protection and processing of huge amounts of data.

Such active initiatives are expected to boost the demand for AI chipsets in the coming period.

LATEST TRENDS

Rising Adoption of the Cloud-based Solutions among Enterprises to Aid Market Growth

Cloud-based artificial intelligence chipsets are the computational chipsets designed specifically for AI training and inference functions. The advancement of cloud technology would create opportunities for key players in the artificial intelligence chipsets market. The growing data center establishment globally in various sectors such as IT & telecom, automotive, etc. is likely to propel the demand for AI chipsets based on the cloud. In addition, companies such as Intel Corporation, Alibaba Group Holding Limited, NVIDIA Corporation, and others offer the cloud-based AI chipset. These market players are focusing on launching advanced cloud-based solutions to manage mega file storage and massive business data.

• For instance, in September 2019, Alibaba Group Holding Limited launched an artificial intelligence (AI)-based chipset - "Hanguang 800" that offers advanced computing capability on the cloud. This chip can accelerate machine learning tasks and improves the customer experience.

Also, the increasing investments in Industry 4.0 and the advent of smart manufacturing technologies among enterprises aids the artificial intelligence chipsets market growth. According to PricewaterhouseCoopers (PwC), European industries such as manufacturing, automotive, electronics, and others are expected to invest USD 182.04 billion in the Industry 4.0 solutions in 2020.

DRIVING FACTORS

Emergence of Quantum Computing to Aid Market Growth

Quantum computing technology is widely adopted by enterprises globally, to solve complex problems, and perform analytical calculations. For instance, Google LLC's Sycamore quantum computer is amongst the fastest computers that can perform a specific task in around 200 seconds. Quantum computers are enabled with technologies such as artificial intelligence, machine learning, computer vision, big data, AR/VR, and others. Thus, the emergence of quantum computing is expected to drive the growth of the market.

Besides, quantum computing is used in various functions such as fraud detection, risk management, portfolio optimization, and applications where instant data response is required. Therefore, it is easier for a single processor to accomplish complicated calculations in a few seconds. Hence, these factors are expected to boost the growth of the global AI chipsets market. Some of the secondary drivers for this market are the rising adoption of virtual assistance devices, advanced micro devices, medical lasers, self-driving cars, and others.

RESTRAINING FACTORS

Lack of Skilled AI Workforce to Inhibiting the Market

AI consists of complicated algorithms. To develop, manage, and deploy AI systems, enterprises require a workforce with notable experience and certain skill sets. Also, the integration of AI-based solutions in the existing systems is a challenging task that requires huge data processing to replicate human behavior. In addition, the absence of professional certifications and standards in advanced technologies such as AI, ML, and others is restricting the growth of the artificial intelligence chipsets market. These market restraints are owing to a lack of technology awareness and limitations on AI experts.

SEGMENTATION

By Chipset Type Analysis

Graphics Processing Unit (GPU) Segment to Gain Traction Owing to its Rising Adoption amongst Enterprises

Based on the chipset type, the market has been divided into graphics processing units (GPU), field-programmable gate arrays (FPGAs), application-specific integrated circuits (ASIC), and others.

Among these, the graphics processing unit (GPU) segment is expected to hold the largest artificial intelligence chipsets market share during the predicted period. The rising adoption of GPUs at edge devices, advanced 3D gaming, AR/VR, virtual assistance, and others are likely to fuel the segment growth. The field-programmable gate arrays (FPGAs) segment is likely to show significant growth owing to the growing adoption of FPGA in areas of network processing, deep packet inspection, network security, and others.

By Application Analysis

Emergence of Robotic Technology to Drive the Robotic Process Automation (RPA) Segment

Based on the application, the market is further segregated into natural language processing (NLP), robotic process automation (RPA), machine learning, computer vision, and others.

The machine learning segment is anticipated to exhibit the highest market share in the coming years. The increasing adoption of cloud-based services, technological advancement, proliferation in data generation, and rising unstructured data leads to the increasing demand for machine learning solutions.

The robotic process automation (RPA) segment is anticipated to experience the highest growth rate owing to the increasing demand for automation of various tasks across the automotive, consumer electronics, and manufacturing industries. In addition, the emergence of autonomous robotics technology is likely to fuel the demand for computer vision, NLP, and other solutions among enterprises.

By Computational Technology Analysis

Edge Computing Segment to Dominate the Market, owing to Increasing Automation across the Globe

Based on computational technology, the market is segmented into cloud computing and edge computing. Among these, the edge computing segment is estimated to hold the largest market share during the forecast period. The emergence of connected car and autonomous vehicle infrastructure and the need for lightweight systems & frameworks are expected to fuel the market in the coming years.

The cloud computing segment is likely to witness radical growth during the estimated period. The rising adoption of cloud computing in data centers to reduced operational cost, improved infrastructure management, and enhanced operational efficiency are the factors prompting the growth of the segment.

By Function Analysis

Increasing Demand for AI Chipsets for Inference to Drive Market

Based on the function, the artificial intelligence chipsets market has been bifurcated into training and inference. Among these, the inference segment is estimated to hold the largest market share during the forecast period. The increasing need for edge computing owing to safety and privacy concerns is likely to drive the segment growth. The training segment is expected to exhibit the highest growth rate owing to its ability to process massive parallel architectures.

By Industry Analysis

Increasing Adoption of AI Chipsets across Healthcare Industry to Boost the Market

Based on the industry, the market is segmented into consumer electronics, healthcare, BFSI, IT & telecom, manufacturing, automotive, retail, and others.

The consumer electronics segment is likely to hold the dominant share owing to the growing demand for connected devices such as smartphones, tablets, and others.

• For instance, in September 2019, Apple Inc. has built its A11, A12, and A13 Bionic Chips for the high-performance processors that consist of core CPUs integrated with GPUs as accelerators.

The healthcare segment is likely to gain traction in the coming years. The high consumerization of routine checkup medical tools, smart wearable devices, and personal care products is increasing the demand for AI-enabled healthcare devices. However, the outbreak of the novel coronavirus has increased the applications of artificial learning technology across the sector. In addition, the growing adoption of the artificial intelligence chipsets across the BFSI, IT & telecom, manufacturing, automotive, retail, and others are expected to propel the growth of the market in the coming future.

REGIONAL INSIGHTS

Geographically, the market is segregated across five major regions, namely North America, South America, Europe, Middle East & Africa, and Asia Pacific. North America is expected to dominate the market in terms of revenue share in the global market during the predicted period. Increasing government investments in R&D and the availability of established IT infrastructure are likely to fuel the market growth in North America. The presence of major key players such as NVIDIA Corporation, Intel Corporation, Google LLC, and others are also boosting the demand for AI chipsets across the US and Canada. These players are focusing on launching advanced AI chipsets to improve their product portfolio.

• For instance, in May 2020, NVIDIA Corporation launched its next-generation Ampere GPU architecture – “NVIDIA A100”. It is the first GPU that is based on the NVIDIA Ampere architecture designed for cloud graphics, data analytics, and scientific computing.

Asia Pacific is likely to emerge as the fastest-growing regional market during the estimated period. The developing economies in the region such as South Korea, India, etc. pose a vibrant and strong startup ecosystem aided with a growing number of skilled workforce, that drives the growth of this market. In addition, the government of Singapore has created an AI Ethics Advisory Council as a part of its AI Strategy to deploy AI applications across various industries in 2018.

Europe is expected to develop with a considerable growth rate owing to the presence of a significant number of AI solution providers. European countries are focused on R&D investments and focusing on the adoption of AI technology. In the Middle East and Africa, the oil-rich Gulf States are making active initiatives to diversify their economies through AI technology. In addition, autonomous transport and smart city initiatives boosted the demand for AI capabilities in this region. South American countries such as Brazil, Argentina, etc. are adopting AI strategies and coherent policies, which are expected to pose lucrative market opportunities in near future.

KEY INDUSTRY PLAYERS

Emphasis towards Developing Advanced AI Chipsets by Key Players to Increase Competition

Companies such as IBM Corporation, NVIDIA Corporation, Intel Corporation, Huawei Technologies Co., Ltd., and Samsung Electronics Co., Ltd., among others are some of the major players in the market. Players are focused on developing AI chipsets with advanced technology such as cloud, big data, and others. Also, the high competition in the market is forcing service providers to focus on acquisition strategy for strengthening their position in this market.

Emphasis is being placed on product innovation and cost-efficiency to ensure long-term sustainability. For instance, in August 2019, Huawei Technologies Co., Ltd. launched its new AI chipset - "Ascend 910" and AI computing framework - "MindSpore" for enterprises. This chipset offers256 TeraFLOPS for half-precision floating-point (FP16) operations. The aim is to improve the customer experience.

List of Key Companies Profiled:

• NVIDIA Corporation (California, United States)


• Intel Corporation (California, United States)


• Xilinx, Inc. (California, United States)


• Samsung Electronics Co., Ltd. (Suwon-si, South Korea)


• Micron Technology, Inc. (Idaho, United States)


• Kneron (California, United States)


• Alibaba Group Holding Limited (Hangzhou, China)


• Qualcomm Technologies, Inc. (California, United States)


• International Business Machines Corporation (IBM) (New York, United States)


• Alphabet Inc. (Google LLC) (California, United States)


• Microsoft Corporation (Washington, United States)


• Amazon Web Services (AWS) (Washington, United States)


• Advanced Micro Devices, Inc. (AMD) (California, United States)


• General Vision, Inc. (California, United States)


• Huawei Technologies Co., Ltd. (Shenzhen, China)


• Graphcore Limited (Bristol, United Kingdom)


• MediaTek Inc. (Hsinchu, Taiwan)


• Fujitsu Limited (Tokyo, Japan)


• Wave Computing, Inc. (California, United States)


• Mythic Inc. (Texas, United States)


• Koniku Inc (California, United States)


• Tenstorrent Inc. (Ontario, Canada)


• SambaNova Systems Inc (California, United States)


• Kalray Corporation (Isere, France)


• XMOS Limited (Bristol, United Kingdom)


• GreenWaves Technologies (Isere, France)

KEY INDUSTRY DEVELOPMENTS:

• August 2020: Kneron launched Kneron KL 720 SoC, an advanced chipset based AI. The chipset provides 1.5 TOPS in performance from its SoC, enabled with Arm Cortex M4 as its main control unit.

REPORT COVERAGE

The artificial intelligence (AI) chipsets market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the advanced market over recent years.

Report Scope and Segmentation

ATTRIBUTE	DETAILS
Study Period	2016 – 2027
Base Year	2019
Forecast Period	2020 – 2027
Historical Period	2016 – 2018
Unit	Value (USD billion)
Segmentation	By Chipset Type Graphics Processing Unit (GPU) Field Programmable Gate Arrays (FPGAs) Application-specific Integrated Circuit (ASIC) Others (Central Processing Unit (CPU), etc.)
By Application Natural Language Processing (NLP) Robotic Process Automation (RPA) Machine Learning Computer Vision Others (Context-aware Computing, etc.)
By Computing Technology Cloud Computing Edge Computing
By Function Training Inference
By Industry Consumer Electronics Healthcare BFSI IT & Telecom Manufacturing Automotive Retail Others (Government, etc.)
By Region North America By Chipset Type By Application By Computing Technology By Function By Industry By Country The U.S. By Chipset Type Canada By Chipset Type Mexico By Chipset Type Europe By Chipset Type By Application By Computing Technology By Function By Industry By Country UK By Chipset Type Germany By Chipset Type France By Chipset Type Italy By Chipset Type Spain By Chipset Type Russia By Chipset Type Benelux By Chipset Type Nordics By Chipset Type Rest of Europe Asia Pacific By Chipset Type By Application By Computing Technology By Function By Industry By Country China By Chipset Type India By Chipset Type Japan By Chipset Type South Korea By Chipset Type ASEAN By Chipset Type Oceania By Chipset Type Rest of Asia Pacific Middle East & Africa By Chipset Type By Application By Computing Technology By Function By Industry By Country Turkey By Chipset Type Israel By Chipset Type GCC By Chipset Type North Africa By Chipset Type South Africa By Chipset Type Rest of MEA South America By Chipset Type By Application By Computing Technology By Function By Industry By Country Brazil By Chipset Type Argentina By Chipset Type Rest of South America