Artificial intelligence M&A deals grow by a third in the last 12 months as defense companies focus on developing their own AI capabilities says GlobalData

Artificial intelligence (AI) sector deals have grown by 33.5% in the last 12 months, with the average deal being valued at $159 million, according to GlobalData. The leading data and analytics company confirms that the number of AI deals is likely increasing as the technology becomes more advanced and more companies see market opportunities in the technology. The current market growth in deals has largely occurred in the Asia-Pacific region, but that in the last 12 months the South and Central American market has increased by 200%.

William Davies, Associate Analyst at GlobalData comments: “Historically AI has been the purview of the technology sector and this increase in mergers and acquisition signals that defense primes are advancing their AI capabilities organically and through acquisitions. These companies are increasingly attempting to bring operations in-house and develop their own capabilities without relying on larger tech companies.”

GlobalData’s latest report AI in Aerospace and Defense highlights the transformative potential of AI, and its ability to create more efficient and effective military operations. The report also signals that a race for AI dominance between the US, Russia and China will lead to significant government investment in the technology, providing more contract opportunities and more of a necessity for defense primes to integrate AI into future platforms.

AI technologies are rapidly evolving. The US and China are developing their AI capabilities for a broad range of military functions that will have a significant impact on the defense sector.

Davies adds: “AI is a transformative technology in defense because of its ability to enable militaries to gather and make use of large amounts of data, potentially providing a competitive edge over their adversaries. AI will be of particular utility to the development of unmanned vehicles, which have the potential to reduce operations costs whilst exposing personnel in the field to less risks.”

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