Generative AI: Rising Adoption Across Sectors (Riyadh Valley Company)

Summary

• The global generative AI market was worth $36.06 billion in 2024 and is expected to rise to $62.72 billion in 2025.p.6
• About 40% of the activities performed by employees across sectors could be automated with generative AI.p.6
• AI adoption among GCC companies stands at 75%, above the global rate of 65%.p.9
• 57% of GCC companies allocate at least 5% of their digital budget to AI, compared with 33% globally.p.9
• Saudi Arabia invested $120 million to acquire more than 3000 Nvidia GPUs for training models.p.11
• DeepSeek developed its R1 model to compete with ChatGPT-4o at a cost of no more than $5.6 million.p.12

Key insights

1. The global generative AI market grew to $36.06 billion in 2024.p.6
2. Rising demand for next-generation AI products could add about $280 billion to software revenue.p.6
3. Bloomberg Intelligence expects generative AI to reach 10% of total spending on IT hardware, software services, advertising and gaming by 2032.p.6
4. McKinsey estimates generative AI could contribute between 1.7 and 2.8% of annual non-oil GDP in GCC economies.p.9
5. Generative AI adoption in the GCC is high, at 75% of companies against 65% globally.p.9
6. Saudi Arabia targets a place among the top 15 countries in AI development by 2030 under its national data and AI strategy.p.10
7. DeepSeek's low-cost R1 model is presented as a lesson that investment in infrastructure, talent and research can deliver results under resource constraints.p.12