Press release
Surging Application Across End Users Powers the Expansion of the Artificial Intelligence In Defense And Security Market in 2025
Market size outlook for the Artificial Intelligence In Defense And Security MarketArtificial intelligence adoption across defense and security has accelerated sharply, with the market projected to grow from $12.53 billion in 2024 to $14.15 billion in 2025, reflecting a 12.9% CAGR. This rise has been supported by growing use of unmanned platforms, expanding reliance on AI for national defense operations, increasing demands for real-time threat detection, rising defense budgets, and ongoing advancements in autonomous weapon systems.
Forecast valuation of the Artificial Intelligence In Defense And Security Market by 2029
Looking ahead, the artificial intelligence market within defense and security is expected to reach $22.75 billion by 2029, progressing at a 12.6% CAGR. This expansion is driven by heightened demand for AI-powered surveillance solutions, wider use of military robotics, a greater need for proactive threat analysis capabilities, increased investment in cybersecurity, and stronger interest in cloud-enabled defense technologies. Key developments expected during this period include advancements in AI algorithms, adoption of multi-domain operational concepts, evolution of autonomous defense systems, deeper integration of AI into C4ISR and battlefield command structures, and improvements in sensor networks paired with enhanced data analytics.
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Drivers contributing to growth of the Artificial Intelligence In Defense And Security Market
Rising government expenditures on defense are expected to be a major force behind the expansion of artificial intelligence in this sector. Defense budgets represent the funds allocated to maintain military readiness, acquire advanced technologies, and support national security initiatives. Geopolitical tensions and increasing global conflicts are pushing countries to reinforce their military capabilities.
Growing defense spending strengthening AI adoption in defense and security
These rising budgets help accelerate AI adoption by funding research, development, and deployment of AI-driven systems across surveillance, autonomous platforms, and threat identification. According to data from the Stockholm International Peace Research Institute (SIPRI), global military spending reached $2,443 billion in 2023, marking a 6.8% real-term increase over 2022. As investment grows, AI technologies are expected to play an even more prominent role in defense modernization.
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Trends influencing the future of the Artificial Intelligence In Defense And Security Market
Leading companies in the defense AI sector are emphasizing the development of advanced autonomous mechanisms to enhance decision-making speed, operational efficiency, and threat recognition. These systems continuously learn from large datasets, detect patterns, and provide real-time insights without constant human intervention.
Innovation examples shaping the Artificial Intelligence In Defense And Security Market
A notable advancement emerged in November 2025 when Tidal Cyber Inc. launched NARC (natural attack reading and comprehension), a platform designed to automate the analysis of cyberattack intelligence. By transforming unstructured threat data into structured, actionable insights aligned with the MITRE ATT&CK framework, NARC accelerates threat analysis, reduces analyst workload, and expands the depth of cyber intelligence available to defense teams. This automation enhances detection, incident response, and proactive cybersecurity strategies across defense environments.
Segment structure of the Artificial Intelligence In Defense And Security Market
The artificial intelligence in defense and security market covered in this report is segmented -
By Component: Hardware, Software, Services
By Technology: Machine Learning, Computer Vision, Natural Language Processing, Other Technologies
By Training And Simulation Solutions: Virtual Reality (VR) And Augmented Reality (AR) Training Modules, Adaptive Learning Technologies, Simulation-Based Training Environments, AI-Driven Decision Making Simulations, Multinational Training Exercises
By Application: Surveillance And Monitoring, Threat Detection And Prevention, Cybersecurity, Autonomous Systems, Intelligence And Analysis, Other Applications
Subsegments include:
Hardware: Processors And Chips, Sensors And Cameras, Data Storage Devices
Software: Data Analytics Tools, Machine Learning Algorithms, Computer Vision Software
Services: System Integration And Deployment, Training And Simulation Services, Consulting And Advisory Services
Leading organizations in the Artificial Intelligence In Defense And Security Market
Major companies in this space include Microsoft Corporation; L3Harris Technologies Inc.; RTX Corporation; Lockheed Martin Corporation; IBM Corporation; Cisco Systems Inc.; General Dynamics Corporation; Northrop Grumman Corporation; Broadcom Inc.; BAE Systems Plc; NVIDIA Corporation; Thales Group; Leonardo S.p.A.; Leidos Holdings Inc.; Palo Alto Networks Inc.; Juniper Networks Inc.; Fortinet Inc.; Check Point Software Technologies Ltd.; Palantir Technologies Inc.; Trellix Corporation; RSA Security LLC; Shield AI Inc.; Charles River Analytics Inc.
Regional opportunities in the Artificial Intelligence In Defense And Security Market
North America was the largest market for artificial intelligence in defense and security in 2024. The regions included in the report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, and Africa.
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This Report Supports:
Business Leaders & Investors - Identify strategic growth avenues and market risks.
Manufacturers & Suppliers - Track evolving defense needs and competitive landscapes.
Policy Makers & Regulators - Understand emerging AI-driven defense technologies and regulatory impacts.
Consultants & Analysts - Provide guidance on defense modernization and AI adoption strategies.
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