Companies continue to splash out on AI, despite disillusionment with the technology
AI investment is precipitating colossal revenue increases in the semiconductor industry
Worldwide spending on AI will hit $2.5 trillion in 2026 according to analysts at Gartner, a 44% increase from 2025, and is expected to increase to $3.3 trillion in 2027.
This projected increase comes in spite of enterprises wallowing in the Trough of Disillusionment stage of Gartner’s own hype cycle, defined as a period where “interest wanes as experiments and implementations fail to deliver”, this year.
“[AI] will most often be sold to companies by their encumberment software provider rather than bought as part of a new moonshot project,” said David-John Lovelock, distinguished VP analyst at the firm.
“The improved predictability of ROI must occur before AI can truly be scaled up by the business,” Lovelock added.
This issue of ROI – or lack thereof – plus the failure of many AI projects were repeated refrains throughout 2024 and 2025. Research from MIT showed that, in 2025, 95% of organizations reported zero return on investment in generative AI projects.
In terms of where 2026’s AI investment will be made, AI infrastructure gets the lion’s share with an anticipated $1.3 billion of cash being poured into this area, according to Gartner.
This is almost 50% of the total 2026 uplift and nearly twice as much as the next target for investment, AI services ($588.6 million), with AI software coming in a close third place ($452.5 million).
This increasing investment in what Gartner describes as the foundations of AI has already been reflected in the revenue growth among semiconductor manufacturers in 2025.
In separate research, the analyst firm found that semiconductor revenue increased 21% year-over-year in 2025, reaching $793 billion.
The big AI investment winners
Leading the pack was Nvidia, a company that has firmly tied its fortunes to the AI wave, with an estimated $125.7 million in revenue and 15.8% market share.
This was followed by Samsung Electronics ($72.5 million and 9.1% market share) and SK Hynix ($60.6 million and 7.6% market share).
Of the top 10 vendors by revenue, all experienced double-digit growth except Intel, which fell by 3.9%, or just under $2 million.
This pattern is expected to continue in the coming year, according to Rajeev Rajput, senior principal analyst at Gartner.
"AI semiconductors – including processors, high-bandwidth memory (HBM), and networking components continued to drive unprecedented growth in the semiconductor market, accounting for nearly one-third of total sales in 2025.
“This domination is set to rise as AI infrastructure spending is forecast to surpass $1.3 trillion in 2026."
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