AI in Security Market Set to Surge by USD 25.47 Billion by 2028: Cloud Demand and Threat Intelligence Fuel Growth

The Artificial Intelligence (AI) in Security Market is projected to grow by USD 25.47 billion between 2023 and 2028, registering an impressive CAGR of 34.73%. As cybersecurity threats evolve in volume and complexity, businesses are investing heavily in AI-driven security frameworks to detect, mitigate, and prevent malicious attacks. The integration of machine learning, cloud intelligence, and real-time data analysis is positioning AI as the backbone of next-gen security strategies.

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Market Segmentation Overview

Deployment

On-Premise (Largest Segment)

The on-premise segment, valued at USD 2.75 billion in 2018, continues to gain traction due to data privacy needs and regulatory compliance across industries. Enterprises use AI-powered on-premise systems to:

• Enhance network security against breaches and phishing websites

• Secure application infrastructures

• Protect sensitive cloud data

• Strengthen threat detection with real-time analytics and neural networks

This model is ideal for sectors handling high volumes of confidential data, such as healthcare, defense, and finance.

Cloud

Cloud-based AI security platforms are experiencing growing demand among SMEs and enterprises alike, enabling:

• Scalable protection for mobile and connected devices

• Intelligent threat detection for online transactions, NEFT, and mobile commerce

• Continuous monitoring and automated incident response

Cloud adoption aligns with broader digital transformation trends, especially in industries facing elevated cyber risks.

Market Dynamics

Key Drivers

Rapid Increase in Use of Mobile and Connected Devices

As IoT and mobile ecosystems expand, so does the attack surface. AI addresses this challenge by:

• Detecting malicious browser ads, phishing websites, and ransomware

• Securing systems across healthcare, automotive, transportation, banking, and government

• Analyzing massive data sets in real-time to pinpoint anomalies

AI’s deep-learning capabilities also support context-aware computing for adaptive risk management.

Market Trends

Increasing Demand for Cloud-Based Applications

AI is becoming a cornerstone of cloud security in the modern enterprise. This trend is driven by:

• Accelerated migration to cloud infrastructure

• Cybercriminals targeting cloud-based services

• Healthcare providers relying on cloud to secure electronic health records, medical imaging, and wearable device data

AI enables these systems to automate detection, improve response time, and enforce compliance management protocols. Small and medium enterprises are turning to cloud-based AI for flexibility and cost-efficiency.

Market Challenges

Technical Difficulties in Developing AI Technologies

While the benefits are clear, the industry faces hurdles including:

• Data privacy concerns when training AI models

• High dependency on large and diverse data sets

• Complexity in developing systems that integrate machine learning, natural language processing, and context-aware computing

The lack of skilled professionals further slows down the implementation of AI-driven solutions in several organizations.

Regional Market Trends

North America (Estimated to contribute 32% to global market growth)

• United States

• Canada

• Mexico

North America leads in AI adoption for security, spurred by rising cyberattack volumes and government initiatives. Key industries investing in AI-powered systems include:

• Retail

• Banking and Financial Services (BFSI)

• Manufacturing

• Healthcare

Enterprises use AI for threat intelligence, secure authentication, and data encryption. Government and defense agencies are also scaling AI deployments to counter threats from politically motivated and radical organizations.

Europe

• Germany

• United Kingdom

AI in security is growing steadily in Europe, with increasing investments from regulated industries. GDPR-compliant security systems powered by AI are becoming standard practice for threat detection and risk mitigation.

APAC

• China

• Japan

Enterprises in APAC are investing in AI to manage cybersecurity risks tied to digitization and industrial automation. Countries like Japan and China are leveraging AI to secure their advanced manufacturing and healthtech ecosystems.

Middle East and Africa

Organizations in these regions are increasingly reliant on AI systems to tackle ransomware and phishing threats affecting critical infrastructure.

South America

Cloud security adoption is accelerating as South American businesses modernize their IT environments and invest in scalable AI solutions for data protection.

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Market Research Overview

The Artificial Intelligence in Security Market is rapidly evolving as organizations adopt advanced technologies like Machine Learning, Deep Learning, and Neural Networks to combat complex cyber threats. Core tools such as Natural Language Processing, Predictive Analytics, and Anomaly Detection are being used for more accurate Threat Detection and Behavioral Analytics, enabling faster responses to suspicious activities. Key applications include Intrusion Detection, Malware Analysis, and Phishing Detection, with growing importance placed on Fraud Detection and Identity Verification in financial and enterprise environments. Technologies such as Access Control, Endpoint Security, and Network Security are being reinforced through AI-driven automation. Additionally, the market benefits from innovations in Cloud Security, Data Encryption, and Real-Time Monitoring, all supported by scalable Security Analytics and Automated Response mechanisms. AI is transforming Cyber Threat Intelligence and Risk Assessment, laying the foundation for more secure and proactive digital infrastructures.

Key Players

Leading technology providers are using partnerships, acquisitions, and AI innovation to expand their footprint:

• Acalvio Technologies Inc.

• Advanced Micro Devices Inc.

• BlackBerry Ltd.

• Broadcom Inc.

• Cisco Systems Inc.

• Darktrace Holdings Ltd.

• Hewlett Packard Enterprise Co.

• Intel Corp.

• International Business Machines Corp.

• Micron Technology Inc.

• NVIDIA Corp.

• Oracle Corp.

• Palo Alto Networks Inc.

• RELX Plc

• Samsung Electronics Co. Ltd.

• SAP SE

• SAS Institute Inc.

• Securonix Inc.

• SparkCognition Inc.

• Thomson Reuters Corp.

Each player is evaluated using qualitative (industry-focused, diversified, etc.) and quantitative criteria (dominant, strong, tentative), helping organizations benchmark performance and identify strategic partners in AI cybersecurity.

Research Analysis Overview

Recent research highlights the expanding use of AI in Vulnerability Management, Biometric Authentication, and Facial Recognition to enhance perimeter defense and identity assurance. Security systems now integrate Voice Recognition, Pattern Recognition, and specialized AI Algorithms for real-time and adaptive protection. With rising concerns around data breaches, Data Protection, Incident Response, and Security Orchestration are becoming essential components of AI security platforms. Advanced practices like Threat Hunting, Penetration Testing, and defending against Zero-Day Exploits and Ransomware are leveraging AI’s predictive capabilities. Innovations in Blockchain Security, IoT Security, and emerging technologies such as Quantum Computing are also being examined for their role in securing next-gen systems. To ensure trust, Explainable AI, Sentiment Analysis, and Contextual Analysis are being incorporated into decision-making models. Finally, AI-powered Video Surveillance and Insider Threat detection systems are providing critical real-time insights, reinforcing layered security architectures across industries.