Global consumer spending on generative artificial intelligence is projected to rise sharply over the rest of the decade, approaching $700bn by 2030, according to new research, as AI tools move rapidly from niche products to everyday technology.
A report by Counterpoint Research forecasts that global consumer spending on generative AI will grow from $225bn in 2023 to $699bn by 2030, representing a compound annual growth rate of 21 percent.
The study points to rapid expansion across both consumer facing AI software and the hardware needed to run it, reshaping how people interact with technology in daily life.
Chatbot platforms are expected to be the fastest growing segment, with strong growth also predicted in personal assistants and content generation tools. By the end of the decade, the number of monthly active users on AI chatbot platforms is forecast to exceed five billion worldwide.
Counterpoint says hardware will account for the largest share of spending, driven mainly by the integration of AI features into personal devices. Global shipments of generative AI smartphones are expected to grow at a compound annual rate of 26 percent between 2023 and 2030, while revenues from those devices are forecast to increase at a 16 percent annual rate over the same period.
Consumer facing AI software, however, is expected to see even faster growth, fuelled by a surge in user adoption. Monthly active users of AI chatbot platforms alone are projected to increase by nearly five billion during the forecast period.
Marc Einstein, Research Director at Counterpoint, said: “Spending on AI hardware will remain robust over the next few years, but it is the growth in software spending which will ultimately determine the success of the new AI ecosystem. And while we predict that the market for AI software will indeed grow massively over the next five years, we expect to see some winners and losers emerge in the near future.”
The report also highlights intensifying competition among large language model providers. OpenAI is expected to retain the largest user base, but Google and Microsoft are projected to record the fastest growth in monthly active users over the period covered by the forecast.
Beyond chatbots, AI powered applications such as art generators, AI companions and photo editing tools are also expected to see rising adoption as consumers experiment with new use cases.
Counterpoint says generative AI is rapidly shifting from a premium feature to a mass market standard. While high end smartphones are expected to continue driving revenues through 2030, much of the growth in device volumes is forecast to come from mid range models, signalling a broader democratisation of AI capabilities.
Emerging AI form factors, including laptops, extended reality devices and AI native hardware, currently represent a smaller share of the market but are seen as the next frontier for growth, gradually expanding the AI hardware ecosystem beyond smartphones.