Australia Artificial Intelligence Market Size and Share Report - Forecast Trends and Outlook (2025-2034)

Key Market Trends and Insights:
Victoria state dominated the market with a market share of 24.3% in 2024 and is projected to grow at a notable CAGR over the forecast period.
By offering artificial intelligence software is set to grow at a CAGR of 56.3% over the forecast period.
By deployment model type, cloud is projected to witness a CAGR of 58.2% throughout the forecast period.Market Size & Forecast:
Market Size in 2024: AUD 4.80 billion
Projected Market Size in 2034: AUD 295.81 billion
CAGR from 2025 to 2034: 51.00%
Fastest-Growing Regional Market: Australian Capital TerritoryAccording to Google and Ipsos's 2025 survey, 49% of Australians employed generative AI in the last year, a considerable increase from 38% reported in 2023. This indicates increased exposure and increased confidence in how AI can improve productivity, innovation, and problem-solving in various industries. The survey also noted that 74% of users of AI incorporate these technologies into their work, using them for writing, brainstorming, coding, and analyzing data.This expanding use of AI for day-to-day work and innovation is prompting businesses to spend money on AI solutions, training, and infrastructure. The speeding up adoption of generative AI and the value it is perceived to bring in automating workflows and creating insights, is turning out to be key drivers of growth for the Australia artificial intelligence market.In addition, there is a growing emphasis on leading responsible and accountable AI that transcends mere compliance. Organizations are placing greater value on AI systems that not only provide efficiency but can also self-assess their reliability, counteract misinformation, and justify decision-making in complex settings.Projects such as the Responsible AI Research (RAIR) Centre established in December 2024, through a collaboration between CSIRO, the University of Adelaide, and the Government of South Australia, are a great example of this trend. Such initiatives are positioning the country as a world leader in AI governance, ethics, and reliable technology deployment, further boosting Australia artificial intelligence market expansion. Australia Artificial Intelligence Market Report Summary Description Value Base YearAUD billion2024Historical PeriodAUD billion2018-2024Forecast PeriodAUD billion2025-2034Market Size 2024AUD billionMarket Size 2034AUD billionCAGR 2018-2024PercentageXX%CAGR 2025-2034Percentage51.00%CAGR 2025-2034 - Market by RegionAustralian Capital Territory57.2%CAGR 2025-2034 - Market by RegionWestern Australia54.6%CAGR 2025-2034 - Market by OfferingSoftware56.3%CAGR 2025-2034 - Market by Deployment ModeCloud58.2%2024 Market Share by RegionVictoria24.3%Key Trends and Recent Developments August 2025 Infosys extended up its presence in Australia’s cloud and AI space with a USD 153 million move to buy 75% of Versent Group (Telstra’s cloud services arm). After the deal closure in mid-2026, it is revealed that Infosys will take the reins, while Telstra will retain a 25% minority stake. August 2025 Macquarie Data Centers partnered with Dell Technologies to develop the Dell AI Factory, a purpose-built facility for enterprise, private, and cloud-based AI projects. The facility supported sectors including healthcare, finance, education, and research. It aimed to provide secure, sovereign AI infrastructure, helping organizations deploy AI safely while meeting national data security and compliance standards. August 2025 Meltwater launched GenAI Lens in Australia artificial intelligence market, enabling brands to monitor and analyze their presence across generative AI platforms like ChatGPT, Claude, and Gemini. The tool helps businesses track AI-driven content, detect misinformation, and gauge sentiment. As Australians increasingly rely on AI for news, research, and recommendations, GenAI Lens empowers brands to protect their reputation and stay competitive in an AI-driven landscape. April 2025 Ernst & Young unveiled more than two dozen AI tools in its Australian audit and assurance division, part of a USD 1 billion global investment to transform auditing. The new tools, including EYQ Assurance Knowledge, aim to streamline administrative tasks, enhance risk-focused auditing, and improve efficiency. This initiative helps auditors save time, reduce burnout, and maintain high-quality standards. Growing adoption of AI-enabled smart resource management The surging adoption of AI to monitor, analyze, and optimize resource usage and infrastructure management is actively boosting Australia artificial intelligence market growth. Governments and utilities are leveraging AI to predict usage patterns, optimize resource allocation, and enhance operational efficiency. For example, in August 2025, the New South Wales government deployed smart meters and the AI platform Autoflow in Ballina, Bathurst, Dubbo, and the Murray River Council, actively driving data-informed water management and strengthening regional infrastructure planning. AI skills development and education programs addressing talent shortages Bridging the AI talent gap is becoming essential for sustaining Australia artificial intelligence market demand. Education and upskilling initiatives are empowering the next generation of users and developers, ensuring the workforce is equipped for emerging opportunities. A prime example is the AWS and Code for Schools partnership in August 2025, which aims to teach AI literacy to one million K-12 students, while providing teachers and parents with resources to support responsible and practical adoption of AI technologies nationwide. Rising investment in AI infrastructure development Investment in AI infrastructure is a critical driver of Australia artificial intelligence market, as it provides the technological backbone and resources needed for innovation, research, and commercial applications. Advanced infrastructure, including data centers, cloud platforms, and high-performance computing facilities, enables faster deployment of AI solutions across sectors such as healthcare, finance, and manufacturing. For instance, in July 2024, Microsoft invested AUD 5 billion to expand its hyperscale cloud and AI infrastructure in Australia. This initiative includes collaborations with the Australian Signals Directorate on a major cybersecurity program, demonstrating how strategic investments strengthen Australia’s AI ecosystem. Strategic partnerships boosting AI adoption and reliability Collaborations between AI developers and established organizations are increasingly shaping the Australia artificial intelligence market landscape by improving the accuracy, reliability, and relevance of AI applications. By leveraging trusted partners’ expertise and data, AI systems can deliver more precise and timely insights, boosting adoption across sectors. For example, in August 2025, the Australian Associated Press partnered with Google’s Gemini AI to supply real-time news content, enhancing responsiveness. Such partnerships also help address challenges like data bias and credibility, supporting overall market growth. Policy support for AI adoption Government support is boosting the Australia artificial intelligence market by providing clear guidance for AI adoption. In August 2025, the Australian Government released the AI Technical Standard to help agencies use AI safely and ethically. In addition, it also launched the ‘Gov AI’ service to assist agencies in developing AI applications and collaborating across the public sector. These initiatives build trust, promote innovation, and make it easier for organizations to adopt AI nationwide. They also set a benchmark for responsible and effective AI use across Australia.The EMR’s report titled “Australia Artificial Intelligence Market Report and Forecast 2025-2034” offers a detailed analysis of the market based on the following segments:Market breakup by Offering
Hardware
Software
Services Key Insight: Software is the largest segment in the Australia artificial intelligence market, driven by growing adoption of AI platforms, analytics tools, and generative AI solutions across BFSI, healthcare, and government sectors. Services are the fastest-growing segment, as enterprises increasingly rely on consulting, deployment, and AI governance to ensure responsible and scalable AI adoption. Hardware also fuels growth, with investments in high-performance computing, GPUs, and AI accelerators supporting complex workloads and cloud infrastructure.Market breakup by Deployment Mode
On Premise
Cloud Key Insight: Cloud deployment dominates the Australia AI Market, offering businesses flexibility, rapid scalability, and reduced IT overheads. Organizations in finance, healthcare, and government increasingly rely on cloud AI for real-time insights and advanced analytics. On-premises deployment, however, is expanding at a faster pace, as companies prioritize control over sensitive data, compliance, and security. Rising investments in hybrid systems and dedicated AI infrastructure are further supporting the simultaneous growth of both deployment modes.Market breakup by Technology
Machine Learning
Natural Language Processing
Deep Learning
Computer Vision
Generative AI Key Insight: Machine learning leads the Australia AI Market, powering predictive analytics, automation, and decision-making across BFSI, healthcare, and government sectors. Natural language processing drives adoption through chatbots, virtual assistants, and sentiment analysis. Deep learning supports advanced analytics and image recognition, while computer vision enables intelligent surveillance, diagnostics, and industrial automation. Generative AI is the fastest-growing segment, transforming content creation, enterprise workflows, and AI-driven innovation, making Australia a hub for cutting-edge AI technologies.Market breakup by Business Function
Sales and Marketing
Supply Chain Management
Finance and Accounting
Operations
Human Resource Management
Security
Legal and Compliance Key Insight: Business Function in the Australia artificial intelligence market is driven by AI adoption across multiple areas. Sales and marketing is the largest segment, benefiting from predictive analytics, personalized campaigns, and lead scoring. Supply chain management is the fastest-growing segment, powered by AI-enabled logistics, inventory optimization, and demand forecasting. Finance and accounting leverage fraud detection and process automation, operations use predictive maintenance, HR improves talent management, security monitors threats, and legal & compliance strengthens regulatory adherence, collectively enhancing efficiency and innovation.Market breakup by Industry Vertical
Healthcare
Retail
IT and Telecom
BFSI
Automotive
Manufacturing
Media and Entertainment
Others

Key Insight: Industry vertical in the Australia artificial intelligence market is witnessing strong growth across multiple sectors. BFSI is the largest segment, driven by AI adoption for fraud detection, risk management, and customer personalization. Healthcare is the fastest-growing segment, fueled by AI applications in diagnostics, patient care, and drug discovery. Retail leverages AI for personalized recommendations and inventory management, IT and telecom optimize operations, automotive focuses on autonomous systems, manufacturing enhances production efficiency, and media & entertainment adopt AI for content personalization and analytics. Market breakup by Region
New South Wales
Victoria
Queensland
Australian Capital Territory
Western Australia
Others

Key Insight: New South Wales holds a significant share in the Australia AI market, driven by corporate headquarters, government initiatives, and research hubs. Victoria is the fastest-growing region, fueled by AI startup investments and technology parks. Queensland benefits from industrial automation and healthcare AI adoption, Western Australia leverages mining and energy sector AI applications, the Australian Capital Territory focuses on government AI programs, and other regions are adopting AI across education, retail, and BFSI, collectively boosting national AI growth and innovation.Australia Artificial Intelligence Market Share By offering, software are gaining significant traction The growing demand for software in the Australia artificial intelligence market is primarily driven by the integration of AI-powered analytics tools across various industries. For instance, in June 2025, the Commonwealth Bank of Australia (CBA) implemented over 2,000 AI models analyzing 157 billion data points daily, enabling personalized banking experiences and operational efficiencies. This widespread adoption of AI analytics platforms continues to expand across sectors like healthcare, retail, and government, solidifying software as the largest segment in the market.Meanwhile, services are recording fastest growing demand in the Australia AI market due to the rising requirement for AI assurance and governance. With increasing AI adoption, businesses need to ensure transparency, fairness, and accountability in their systems. In June 2025, PwC Australia launched Assurance for AI, offering independent evaluations of governance, monitoring, and compliance. This initiative supports responsible AI deployment, helping organizations gain stakeholder trust and meet regulatory requirements, fueling growth in consulting and AI governance services. By deployment model, cloud demonstrates notable growth Cloud deployment model is picking up pace in the Australia artificial intelligence market driven by the expansion of local cloud and enterprise AI platforms. This enables businesses to adopt scalable, secure, and responsible AI solutions. In response to rising demand and regulatory requirements, in November 2024, IBM launched its watsonx platform in Sydney, providing advanced AI tools, data storage, and governance capabilities. Cloud infrastructure ensures data sovereignty, low-latency performance, and compliance, helping organizations across industries harness AI effectively, and improve productivity.On the other hand, on-premises deployment in the Australia AI Market is mainly driven by the need for data security and regulatory compliance. Organizations with sensitive information, such as government agencies and financial institutions, prefer local infrastructure to maintain control over their AI workloads. This approach ensures that critical data remains protected, reduces reliance on external providers, while allowing organizations to meet stringent privacy regulations. By technology, machine learning dominates the market growth Machine learning accounts for the major share in the Australia artificial intelligence market, driven by the increasing deployment of predictive maintenance in industrial and manufacturing sectors. Companies are leveraging ML algorithms to continuously monitor equipment via real-time sensor data, identify early signs of wear, and forecast potential failures. This anticipatory approach reduces unplanned downtime, optimizes maintenance schedules, and lowers operational costs, thereby contributing to the increasing adoption of ML across industrial operations.Meanwhile, generative AI is driving transformative growth in Australia artificial intelligence market as companies actively scale investments in this technology. As per market analysis, ANZ firms allocated USD 15 million for Gen AI in 2024, surpassing the global average. Businesses are deploying generative AI to create advanced content, enhance decision-making, and develop innovative products and services. This proactive adoption of Gen AI is accelerating operational efficiency, enabling personalized solutions, and opening new revenue streams, positioning Australia as a leading market for generative AI technologies. By business function, sales and marketing commands the highest share Sales and marketing business function is witnessing significant growth in the Australia artificial intelligence market driven by the AI-powered B2B intelligence. By leveraging platforms that provide accurate, real-time, and localized business data, companies can identify high-value leads, prioritize outreach, and optimize campaigns, boosting efficiency and revenue. For example, Firmable, which officially launched in New Zealand in May 2025, is helping businesses scale faster in previously underserved markets. This development demonstrates how AI-driven insights are directly enabling smarter.Supply chain management contributes significantly to the Australia AI market mainly due to the growing demand among businesses for AI-powered solutions to optimize retail operations and supply chain efficiency. Intelligent inventory management platforms like GreyOrange’s gStore unveiled advanced analytics, item-level RFID tracking, and real-time insights in August 2025. These technologies streamline store execution, automate replenishment, and improve product visibility. By integrating AI across retail processes, businesses can respond faster to market changes and gain a competitive edge in the fast-evolving retail landscape. By industrial vertical, BFSI accounts for the largest revenue share BFSI leads the Australia artificial intelligence market growth propelled by the escalating use of advanced AI to enhance security and fraud detection. Financial institutions are increasingly deploying AI tools to identify suspicious transactions, mitigate risks, and protect customer assets. Citing an instance, in August 2025, CommBank partnered with OpenAI to integrate enterprise-grade AI solutions like ChatGPT Enterprise, while also upskilling employees. The partnership strengthened scam detection and enhanced personalized services, showing how AI boosts efficiency and trust in banking.Healthcare is also substantially contributing to the Australia AI market attributed to the surging adoption of AI-driven precision medicine. AI rapidly analyzes genetic and biological data, helping clinicians predict risks, detect mutations, and personalize treatments, improving outcomes and care efficiency. For example, in March 2025, Australian National University researchers used AI-powered protein modeling alongside genome sequencing to uncover mutation patterns. This helped in targeted treatments for genetic diseases, thereby showcasing AI’s potential in transforming healthcare delivery.Australia Artificial Intelligence Market Regional Analysis By region, Victoria holds the biggest market portion Victoria state experienced significant growth and is set to amass notable revenue in the Australia artificial intelligence market majorly due the strategic development of high-performance computing infrastructure. In June 2025, the Victorian Government backed the launch of Australia’s latest AI supercomputer at La Trobe University’s Australian Centre for Artificial Intelligence in Medical Innovation (ACAMI). This advanced system accelerates complex biological data analysis, supports faster clinical trials, and enables personalised healthcare solutions. By strengthening Victoria’s status as a national hub for AI-driven medical research, it attracts top talent and fosters innovation, further fueling the regional growth.The Australian Capital Territory (ACT) is the fastest-growing segment in the Australia Artificial Intelligence (AI) market, fueled by its strong focus on technological innovation and supportive government policies. The region hosts numerous research institutions, start-ups, and technology hubs developing AI solutions across healthcare, cybersecurity, and smart infrastructure. Initiatives such as government-funded AI projects and smart city programs further accelerate adoption. This combination of innovation, policy backing, and strategic investment makes the ACT a key driver in the growth of Australia’s AI market.Competitive LandscapeLeading artificial intelligence companies are strengthening their positions in the AI market by investing heavily in research and development, expanding product portfolios, and building advanced cloud infrastructure. Firms like Microsoft, Amazon Web Services, and IBM are integrating generative AI tools into enterprise platforms to improve efficiency and decision-making. Partnerships with governments and industry players further enhance adoption, ensuring scalability and compliance with evolving regulations.Another major strategy driving growth is the focus on accessibility and trust in AI. Companies such as NVIDIA, Alphabet, and OpenAI are prioritizing responsible AI frameworks, governance models, and open-source collaborations to foster transparency. They are also expanding data center capacity, developing sovereign AI infrastructure, and offering customized AI solutions for healthcare, finance, and education. These combined efforts ensure long-term competitiveness and accelerate large-scale AI deployment. NVIDIA Corp. Established in 1993 and based in Santa Clara, California, NVIDIA pioneered graphics processing units (GPUs) and now leads in AI computing platforms. Its technologies power applications in gaming, autonomous vehicles, and data centers. Amazon Web Services (AWS), Inc. Launched in 2006 and headquartered in Seattle, Washington, AWS is the world’s leading cloud services provider. It offers scalable computing, storage, AI, and data solutions that support enterprises, startups, and governments worldwide. Microsoft Corp. Microsoft is located in Redmond, Washington. The company was founded in 1975, and is a global leader in software, cloud computing, and AI solutions, with flagship products like Windows, Office, Azure, and Dynamics driving innovation across industries. IBM (International Business Machines Corporation) Founded in 1911, IBM is headquartered in Armonk, New York. The company provides advanced technology solutions in hybrid cloud, AI, and consulting, with a strong legacy in enterprise computing and innovation.Other prominent players operating in the Australia artificial intelligence market include, Cisco, OpenAI, Alphabet (Google), Intel, Salesforce, Oracle, SAP, Meta Platforms, and Hewlett Packard Enterprise (HPE), among Others

.Key Highlights of the Australia Artificial Intelligence Market Report: 
Comprehensive analysis of historical market performance along with precise forecasts extending through 2034, providing a clear view of growth trajectories.
Insights into product innovations, emerging technologies, and adoption trends that are shaping the AI landscape across multiple industries.
In-depth competitive landscape profiling of leading domestic and international AI solution providers, highlighting strategies, market shares, and recent developments.
Regional analysis identifying emerging hubs, high-growth states, and areas with strategic investment potential within Australia.
Investment-focused outlook supported by robust data on market size, CAGR, and opportunities across business functions and industry verticals.Why Choose Expert Market Research? 
Trusted insights backed by extensive primary and secondary research, ensuring reliable and actionable intelligence.
Actionable data designed to support strategic decision-making, planning, and market entry strategies.
Region-wise and product-specific analysis to help organizations identify growth opportunities and optimize their business strategies effectively.Call to ActionExplore the latest trends shaping the Australia Artificial Intelligence Market 2025-2034 with our in-depth report. Gain strategic insights, future forecasts, and key market developments that can help you stay competitive. Get your free sample report or contact our team for customized consultation on Australia Artificial Intelligence Market trends 2025 . Show more