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Natural Language Understanding Market Size

Report ID: GMI11898
Published Date: Oct 2024
Report Format: PDF

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Natural Language Understanding Market Size

The global natural language understanding market size was valued at USD 19.3 billion in 2023 and is estimated to register a CAGR of 20.1% between 2024 and 2032. The increasing adoption of AI-powered solutions across various industries, the growing demand for enhanced customer experience, and the rising need for efficient data analysis are key factors driving the demand for NLU solutions.

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Companies are increasingly investing in NLU technologies and leveraging strategic acquisitions to enhance their market presence and capabilities. For instance, in February 2024, Databricks acquired Einblick, a natural language processing technology company, to enhance the query capabilities of its data intelligence platform that allows users to interact with their data more intuitively and efficiently.

Natural Language Understanding Market Report Attributes
Report Attribute	Details
Base Year:	2023
Natural Language Understanding Market Size in 2023:	USD 19.3 Billion
Forecast Period:	2024 - 2032
Forecast Period 2024 - 2032 CAGR:	20.1%
2032 Value Projection:	USD 99.8 Billion
Historical Data for:	2021 - 2023
No. of Pages:	175
Tables, Charts & Figures:	200
Segments covered:	Component, Deployment Mode, Organization Size, Technology, Application, End Use
Growth Drivers:	Increasing adoption of AI-powered solutions Growing demand for enhanced customer experience Rising need for efficient data analysis Advancements in machine learning and large language models
Pitfalls & Challenges:	Data privacy and security concerns Lack of skilled professionals in NLU technologies

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Additionally, the growing emphasis on multimodal AI is significantly driving the NLU market. As organizations aim to develop more advanced AI systems that integrate various data forms such as text, speech, and images, the demand for sophisticated NLU solutions is increasing. It enables machines to process and interpret multiple types of inputs simultaneously, creating more contextually aware and accurate interactions. The multimodal AI market is expected to grow from $1.2 bn in 2023 to $13 bn by 2032, with an annual growth rate of over 30%. This surge emphasizes the rising adoption of AI technologies that can combine linguistic and visual data.

Authors: Preeti Wadhwani, Satyam Jaiswal

Frequently Asked Questions (FAQ) :

The market size of natural language understanding reached USD 19.3 billion in 2023 and is set to grow at a 20.1% CAGR from 2024 to 2032, driven by the increasing adoption of AI-powered solutions across various industries.

The solution segment was valued at over USD 16 billion in 2023, due to the increasing demand for NLU-powered applications such as chatbots, virtual assistants, and text analytics tools.

The cloud-based NLU segment is anticipated to register a CAGR of over 18% from 2024 to 2032, propelled by the rapid adoption of cloud computing and the need for scalable, flexible NLU solutions.

The North America market recorded a major share of over 35% in 2023, led by significant growth in the U.S. due to the presence of major technology companies and a robust startup ecosystem.