Artificial Intelligence in Australia - Market Research Report (2013-2028)
Melbourne, Australia
Last Updated: December 2023
ANZSIC OD5562Revenue
$2.5bn
Past 5-Year Growth
Profit
$X.Xm
Employees
5,340
Businesses
580
Wages
$XXX.Xm
Artificial Intelligence in Australia industry analysis
The industry has seen surging growth in recent years. Part of this has been driven by strong AI investments in the mid to late 2010s, which saw a raft of new companies enter the industry. Many of these companies have now entered commerciality and begun generating meaningful revenue. Also, the industry has been supported by ChatGPT’s public release, which pushed AI capabilities into the public consciousness and encouraged companies to actively explore how they can increasingly integrate AI into their operations. Overall, industry revenue is expected to grow an annualised 14.1% over the five years through 2023-24, to reach $2.5 billion.
Trends and Insights
- The public release of ChatGPT has democratised access to artificial intelligence products. Since November 2022, AI products have had a rapidly growing demand base, with even small-to-medium enterprises and individual professionals exploring generative AI’s potential.
- Demand for chatbots and digital assistants has soared on the back of ChatGPT’s public release. Chatbots and digital assistants is the fastest-growing industry segment as companies explore new ways to employ generative AI.
- South Australia has been actively encouraging investment in AI through supportive policies. While only a small share of businesses are currently headquartered in South Australia, it has some of the fastest growth in new patents and companies.
- In-house AI development is one of the biggest threats to industry growth. Concerns about data privacy and the opportunity to generate a competitive advantage have encouraged larger companies to build their own AI products internally.
Industry Overview
Market size and recent performance (2013-2028)
Industry revenue has grown at a CAGR of 14.1 % over the past five years, to reach an estimated $2.5bn in 2023.
Trends and Insights
The industry is still shifting towards commercialisation following a surge of new entrants over the past decade
- The industry tends to have a long development cycle, with companies often spending years generating losses before realising a commercial product and scaling it to the point of profitability.
- Additional trends and insights available with purchase
Source: IBISWorld
Industry outlook (2024-2029)
Market size is projected to grow over the next five years.
Trends and Insights
The Federal Government is one of the first public services trialling generative AI
- In June 2023, the Federal Government announced a partnership with Microsoft for a six-month trial of the Microsoft 365 Copilot generative AI service. This will make it one of the first jurisdictions to employ generative AI in its public service.
Biggest companies in the Artificial Intelligence in Australia
| Company | Market Share (%)
2024 | Revenue ($m)
2024 |
|---|---|---|
Woolworths | 98.4 |
To view the market share and analysis for all 1 top companies in this industry, view purchase options.
Products & Services Segmentation
Source: IBISWorld
Industry revenue is measured across several distinct product and services lines, including Digital Assistants and Chatbots, Predictive Analytics and Cybersecurity. Digital Assistants and Chatbots is the largest segment of the Artificial Intelligence in Australia.
Trends and Insights
Advancements in natural language processing and generative AI have increased demand for chatbots and digital assistants
- Chatbots and digital assistants are a well-established use case across a wide range of sectors, including hospitality, retail and professional services. These firms have traditionally used these products to assist with customer service and support business functions. This segment’s industry revenue share has surged in recent years.
- More insights available in the full report
Widen you competitive advantage with related industries
Competitors
- There are no industries to display.
Complementors
- Cloud Hosting and Data Processing Services in Australia
- Wireless Telephone and Data Services Resellers in Australia
- Data Mining Software in Australia
- Internet Service Providers in Australia
International industries
- Operating Systems & Productivity Software Publishing in the US
- Database, Storage & Backup Software Publishing in the US
- Business Analytics & Enterprise Software Publishing in the US
- Design, Editing & Rendering Software Publishing in the US
- Video Game Software Publishing in the US
Table of Contents
About this industry
Industry definition
The industry includes developers who develop artificial intelligence systems and software. This includes machine learning, neural networks, deep learning, generative AI, natural language processing, computer vision and cognitive computing. This industry only includes companies that create their own AI systems and either license them or use them to develop products and services for clients.
What's included in this industry?
Digital assistants and chatbotsPredictive analyticsCybersecurityRecommendation enginesAutomationAI-assisted sensorsRoboticsCompanies
WoolworthsPurchase this report to view all 1 major companies in this industry.
Related Terms
Natural Language Processing (NLP)Machine LearningGenerative Artificial IntelligenceIndustry Code
ANZSIC 5420 - Artificial Intelligence in Australia
Performance
Get an indication of the industry's health through historical, current and forward-looking trends in the performance indicators that make or break businesses.
Analyst insights
The public release of ChatGPT has democratised access to artificial intelligence products. Since November 2022, AI products have had a rapidly growing demand base, with even ...
In this chapter (4)
- Current Performance
- Outlook
- Volatility
- Life Cycle
Key metrics
- Annual Revenue, Recent Growth, Forecast, Revenue Volatility
- Number of Employees, Recent Growth, Forecast, Employees per Business, Revenue per Employee
- Number of Businesses, Recent Growth, Forecast, Employees per Business, Revenue per Business
- Total Profit, Profit Margin, Profit per Business
Charts
- Revenue, including historical (2013-2022) and forecast (2023-2028)
- Employees, including historical (2013-2022) and forecast (2023-2028)
- Businesses, including historical (2013-2022) and forecast (2023-2028)
- Profit, including historical (2013-2023)
- Industry Volatility vs. Revenue Growth
- Industry Life Cycle
Detailed analysis
- Trends in supply, demand and current events that are driving current industry performance
- Expected trends, economic factors and ongoing events that drive the industry's outlook
- Key success factors for businesses to overcome volatility
- How contribution to GDP, industry saturation, innovation, consolidation, and technology and systems influence the industry's life cycle phase.
Products and Markets
Learn about an industry's products and services, markets and trends in international trade.
Analyst insight
Demand for chatbots and digital assistants has soared on the back of ChatGPT’s public release. Chatbots and digital assistants is the fastest-growing industry segment as comp...
In this chapter
- Products & Services
- Major Markets
- International Trade
Key metrics
- Largest market segment and value in 2023
- Product innovation level
- Total imports, level and trend
- Total exports, level and trend
- Trade Balance
Charts
- Products & services segmentation in 2023
- Major market segmentation in 2023
- International trade, including imports by country and exports by country
Detailed analysis
- Trends impacting the recent performance of the industry's various segments
- Innovations in the industry's product or service offering, specialization or delivery method
- Key factors that successful businesses consider in their offerings
- Buying segments and key trends influencing demand for industry products and services
- Recent trends in import and export volumes, country of origin or destination, and expected future trends
Geographic Breakdown
Discover where business activity is most concentrated in an industry and the factors driving these trends to find opportunities and conduct regional benchmarking.
Analyst insights
South Australia has been actively encouraging investment in AI through supportive policies. While only a small share of businesses are currently headquartered in South Austra...
In this chapter (1)
- Business Locations
Charts
- Share of revenue, establishment, wages and employment in each region
- Share of population compared to establishments in each region in 2023
Tables
- Number and share of establishments in each region in 2023
- Number and share of revenue each region accounts for in 2023
- Number and share of wages each region accounts for in 2023
- Number and share of employees in each region in 2023
Detailed analysis
- Geographic spread of the industry across Asia Pacific, and trends associated with changes in the business landscape
- Key success factors for businesses to use location to their advantage
Competitive Forces
Get data and insights on what's driving competition in an industry and the challenges industry operators and new entrants may face, with analysis built around Porter's Five Forces framework.
Analyst insights
In-house AI development is one of the biggest threats to industry growth. Concerns about data privacy and the opportunity to generate a competitive advantage have encouraged ...
In this chapter (4)
- Concentration
- Barriers to Entry
- Substitutes
- Buyer & Supplier Analysis
Key metrics
- Industry concentration level
- Industry competition level and trend
- Barriers to entry level and trend
- Substitutes level and trend
- Buyer power level and trend
- Supplier power level and trend
Charts
- Market share concentration among the top 4 suppliers from 2018-2023
- Supply chain including upstream supplying industries and downstream buying industries, flow chart
Detailed analysis
- Factors impacting the industry’s level of concentration, such as business distribution, new entrants, or merger and acquisition activity.
- Key success factors for businesses to manage the competitive environment of the industry.
- Challenges that potential industry entrants face such as legal, start-up costs, differentiation, labor/capital intensity and capital expenses.
- Key success factors for potential entrants to overcome barriers to entry.
- Competitive threats from potential substitutes for the industry’s own products and services.
- Key success factors for how successful businesses can compete with substitutes.
- Advantages that buyers have to keep favorable purchasing conditions.
- Advantages that suppliers have to maintain favorable selling conditions.
- Key success factors for how businesses can navigate buyer and supplier power.
Companies
Learn about the performance of the top companies in the industry.
Analyst insights
The industry is highly fragmented and is not prone to market share concentration due to AI technology’s high number of diverse use cases. Firms tend to specialise within a ce...
In this chapter
- Market Share Concentration
- Companies
- Company Spotlights
Charts
- Industry market share by company in 2019 through 2023
- Major companies in the industry, including market share, revenue, profit and profit margin in 2023
- Overview of Woolworths's performance by revenue, market share and profit margin from 2017 through 2023
Detailed analysis
- Description and key data for Woolworths, and factors influencing its performance in the industry
External Environment
Understand the demographic, economic and regulatory factors that shape how businesses in an industry perform.
Analyst insights
The industry currently faces little specific regulation. The Federal Government has set up the AI Ethics Framework but it is currently voluntary. The industry is expected to ...
In this chapter
- External Drivers
- Regulation & Policy
- Assistance
Key metrics
- Regulation & policy level and trend
- Assistance level and trend
Charts
- Regulation & Policy historical data and forecast (2013-2028)
- Assistance historical data and forecast (2013-2028)
Detailed analysis
- Demographic and macroeconomic factors influencing the industry, including Regulation & Policy and Assistance
- Major types of regulations, regulatory bodies, industry standards or specific regulations impacting requirements for industry operators
- Key governmental and non-governmental groups or policies that may provide some relief for industry operators.
Financial Benchmarks
View average costs for industry operators and compare financial data against an industry's financial benchmarks over time.
Analyst insights
As a whole, the industry is currently operating at a slight loss. This reflects the high number of firms operating in the industry that are either still developing their prod...
In this chapter
- Cost Structure
- Financial Ratios
- Key Ratios
Key metrics
- Profit margin, and how it compares to the sector-wide margin
- Average wages, and how it compares to the sector-wide average wage
- Largest cost component as a percentage of revenue
- Industry average ratios for days' receivables, industry coverage and debt-to-net-worth ratio
Charts
- Average industry operating costs as a share of revenue, including purchases, wages, depreciation, utilities, rent, other costs and profit in 2023
- Average sector operating costs as a share of revenue, including purchases, wages, depreciation, utilities, rent, other costs and profit in 2023
- Investment vs. share of economy
Data tables
- Cash Flow & Debt Service Ratios (2013-2028)
- Revenue per Employee (2013-2028)
- Revenue per Enterprise (2013-2028)
- Employees per Establishment (2013-2028)
- Employees per Enterprise (2013-2028)
- Average Wage (2013-2028)
- Wages/Revenue (2013-2028)
- Establishments per Enterprise (2013-2028)
- IVA/Revenue (2013-2028)
- Imports/Demand (2013-2028)
- Exports/Revenue (2013-2028)
Detailed analysis
- Trends in the cost component for industry operators and their impact on industry costs and profitability
Key Statistics
Industry Data
Data Tables
Including values and annual change:
- Revenue (2013-2028)
- IVA (2013-2028)
- Establishments (2013-2028)
- Enterprises (2013-2028)
- Employment (2013-2028)
- Exports (2013-2028)
- Imports (2013-2028)
- Wages (2013-2028)
Methodology
How are IBISWorld reports created?
IBISWorld has been a leading provider of trusted industry research for over 50 years to the most successful companies worldwide. With offices in Australia, the United States, the United Kingdom, Germany and China, we are proud to have local teams of analysts that conduct research, data analysis and forecasting to produce data-driven industry reports.
Our analysts start with official, verified and publicly available sources of data to build the most accurate picture of each industry. Analysts then leverage their expertise and knowledge of the local markets to synthesize trends into digestible content for IBISWorld readers. Finally, each report is reviewed by one of IBISWorld’s editors, who provide quality assurance to ensure accuracy and readability.
IBISWorld relies on human-verified data and human-written analysis to compile each standard industry report. We do not use generative AI tools to write insights, although members can choose to leverage AI-based tools within the platform to generate additional analysis formats.
What data sources do IBISWorld analysts use?
Each industry report incorporates data and research from government databases, industry-specific sources, industry contacts, and our own proprietary database of statistics and analysis to provide balanced, independent and accurate insights.
Key data sources in Australia include:
- Australian Bureau of Statistics
- Australian Taxation Office
- Australian Securities & Investments Commission
Analysts also use industry specific sources to complement catch-all sources, although their perspective may focus on a particular organization or representative body, rather than a clear overview of all industry operations. However, when balanced against other perspectives, industry-specific sources provide insights into industry trends.
These sources include:
- Industry and trade associations
- Industry federations or regulators
- Major industry players annual or quarterly filings
Finally, IBISWorld’s global data scientists maintain a proprietary database of macroeconomic and demand drivers, which our analysts use to help inform industry data and trends. They also maintain a database of statistics and analysis on thousands of industries, which has been built over our more than 50-year history and offers comprehensive insights into long-term trends.
How does IBISWorld forecast its data?
IBISWorld’s analysts and data scientists use the sources above to create forecasts for our proprietary datasets and industry statistics. Depending on the dataset, they may use regression analysis, multivariate analysis, time-series analysis or exponential smoothing techniques to project future data for the industry or driver. Additionally, analysts will leverage their local knowledge of industry operating and regulatory conditions to impart their best judgment on the forecast model.
IBISWorld prides itself on being a trusted, independent source of data, with over 50 years of experience building and maintaining rich datasets and forecasting tools. We are proud to be the keystone source of industry information for thousands of companies across the world.
Learn more about our methodology and data sourcing on the Help Center.
Frequently Asked Questions
Unlock comprehensive answers and precise data upon purchase. View purchase options.
What is the market size of the Artificial Intelligence industry in Australia in 2024?
The market size of the Artificial Intelligence industry in Australia is $2.5bn in 2024.
How many businesses are there in the Artificial Intelligence in Australia industry in 2023?
There are 580 businesses in the Artificial Intelligence industry in Australia, which has grown at a CAGR of 6.9 % between 2018 and 2023.
Has the Artificial Intelligence industry in Australia grown or declined over the past 5 years?
The market size of the Artificial Intelligence industry in Australia has been growing at a CAGR of 14.1 % between 2018 and 2023.
What is the forecast growth of the Artificial Intelligence industry in Australia over the next 5 years?
Over the next five years, the Artificial Intelligence industry in Australia is expected to grow.
What are the biggest companies in the Artificial Intelligence market in Australia?
The biggest company operating in the Artificial Intelligence market in Australia is Woolworths
What does the Artificial Intelligence in Australia include?
Digital assistants and chatbots and Predictive analytics are part of the Artificial Intelligence industry.
Which companies have the highest market share in the Artificial Intelligence in Australia?
The company holding the most market share in Australia is Woolworths.
How competitive is the Artificial Intelligence industry in Australia?
The level of competition is moderate and increasing in the Artificial Intelligence industry in Australia.
