GenAI software revenue to grow 124% in 2024: Omdia

Generative AI (GenAI) software revenue will increase at a 53 percent CAGR from 2023 to $58 billion by 2028, Omdia said in its research report.
Omdia report on predictive AI software revenue

Omdia’s latest Artificial Intelligence Software Market Forecasts reveals that GenAI software revenue will grow by 124 percent in 2024.

Many vendors with large language models (LLMs) are seeing revenue run rates that suggest triple-digit revenue growth in 2024. Top SaaS vendors are adding GenAI features to existing products, sometimes monetizing that with premium-tier subscription offerings. Some GenAI tools, like the GitHub CoPilot, are experiencing a surge in adoption.

Enterprises are eager to allocate GenAI budgets in 2024 to stay ahead of competitors. GenAI market growth will face slowdown over the forecast horizon, primarily due to market maturation but also as actual GenAI results in some cases fail to meet heady expectations and overinvestment.

According to Omdia survey, majority of enterprises, which have deployed GenAI, say it is meeting expectations. Enterprises say some GenAI projects are failing to deliver.

“While we see a near-term frenzy in GenAI interest and actual adoption,” said Neil Dunay, Omdia Principal Forecaster, “the prospects for disillusionment are real.”

Some of the top use cases for GenAI in 2024 will be automated code development, virtual assistants, computer-aided art and photography, video and audio production, and writing assistants.

Growth in GenAI is eclipsing growth in predictive (traditional) AI software revenue, which is entering a more mature phase. Omdia forecasts predictive AI software revenue will reach $136 billion in 2028, a 14 percent CAGR.

Omdia’s Artificial Intelligence Software Market Forecasts covers revenue for the AI technology portion (AI value-add), not the entire software solution.

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