Why the Artificial Intelligence in Military Market Is Set to Skyrocket to $61 Billion by 2034

In the rapidly advancing field of artificial intelligence (AI), the military sector stands out as a critical area of growth, innovation, and strategic importance. The global artificial intelligence in military market is poised to revolutionize defense operations, boasting unprecedented advancements in technology, strategy, and capability.

A new report by The Business Research Company titled Artificial Intelligence in Military Global Report 2025, spanning the historic period from 2019-2024 and forecasted up to 2034, is a comprehensive guide for stakeholders looking to understand and capitalize on this dynamic market.

1. Market Size and Growth Opportunities

The artificial intelligence in military market is experiencing remarkable growth:

Historic Growth: The market grew at a robust compound annual growth rate (CAGR) of 16.72% from 2019, reaching $9,671.92 million in 2024. Future Projections: The market is expected to expand to $23,974.05 million by 2029 at a CAGR of 19.91%, and further to $61,087.46 million by 2034 at an impressive CAGR of 20.57%.

This exponential growth is driven by rising adoption of unmanned aerial vehicles (UAVs), increasing military modernization programs, and higher defense budget allocations globally. For businesses and investors, this means significant opportunities in a burgeoning market.

2. Segment Insights: Targeted Opportunities

The report breaks down the market into key segments by offering, technology, platform, and installation, providing a granular view of opportunities:

By Offering:

Software: The largest segment in 2024, accounting for 42.73% ($4,132.99 million), projected to gain $5,731.03 million in global sales by 2029 Hardware: The fastest-growing segment, expected to grow at a CAGR of 24.25% from 2024-2029

By Technology:

Machine Learning: Dominates the market with 38.02% ($3,677.05 million) of the share in 2024 and is projected to grow by $5,806.41 million by 2029 Context-Aware Computing: The fastest-growing technology segment with a CAGR of 22.94%

By Platform:

Land-Based Systems: The largest platform segment, capturing 36.32% ($3,512.43 million) of the market in 2024 Space Systems: The fastest-growing segment, expected to achieve a CAGR of 23.97% from 2024-2029 By Installation - New Procurement: Represents 52.21% ($5,049.71 million) of the market in 2024 and is forecasted to gain $8,192.84 million in sales by 2029

3. Geographic Insights: Regional Growth Hotspots

The report identifies key regions driving growth:

North America: Leading the market with a 33.66% share ($3,255.65 million) in 2024 Asia Pacific: A growth leader with a projected CAGR of 23.78% from 2024-2029 Middle East, Africa, and South America: Emerging as significant players with growth rates exceeding 20%

This regional analysis enables stakeholders to target high-growth areas and tailor strategies to specific markets.

4. Competitive Landscape: Major Players and Strategies

The AI in military market is fairly concentrated, with the top 10 players accounting for 28.53% of the market in 2023. Key competitors include:

BAE Systems plc: Market leader with a 3.54% share Lockheed Martin Corp., Northrop Grumman Corp., and Raytheon Technologies Corp.: Each holding significant market shares above 3% Innovative Players: Companies like Palantir Technologies Inc. and Anduril Industries Inc. bring cutting-edge technologies to the table

Leading companies are leveraging strategies such as:

Expanding operational capabilities through new contracts Launching advanced products like Raytheon’s RAIVEN, a next-generation electro-optical intelligent-sensing system, enhancing threat detection and situational awareness Strengthening business capabilities with product advancements and strategic expansions

5. Unique Selling Points: Advanced Technologies and Applications

Emerging Technologies:

By integrating AI, hyperspectral imaging, and LiDAR for enhanced threat detection, operators can gain up to five times greater visibility and accuracy compared to conventional systems.

Key Applications:

Threat Monitoring and Situational Awareness: Expected to gain $3,101.23 million by 2029. Mission Support and Surveillance: Technologies like EO/IR systems enhance operational efficiency in contested environments.

6. Why This Report?

Investing in this report provides unparalleled insights into the artificial intelligence in military market:

Comprehensive Data: Detailed analysis of market size, growth rates, and segment opportunities. Actionable Insights: Strategies adopted by leading players to expand market share. Future-Proofing: Clear projections to help anticipate market trends and prioritize investments. Technological Innovations: Exclusive focus on emerging technologies reshaping military capabilities.

As the defense industry increasingly integrates AI, the time to capitalize on these opportunities is now. Whether you are a business executive, investor, or policymaker, this report equips you with the knowledge to make informed decisions and secure a competitive edge in the market.

Unlock the future of military AI by exploring this in-depth report today.

About The Business Research Company:

The Business Research Company is a market intelligence firm that excels in company, market, and consumer research. Located globally, it has specialist consultants in a wide range of industries including manufacturing, healthcare, financial services, chemicals, and technology. Find the company on LinkedIn, Twitter, Facebook, or YouTube for more.