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South Korea Artificial Intelligence Market Report Overview
The South Korea artificial intelligence market attained a value of USD 1370.90 Million in 2025 and is projected to expand at a CAGR of 15.60% through 2035. The market is further expected to reach USD 5842.30 Million by 2035. Strong government backing, a world-leading semiconductor and memory industry, and rapid enterprise adoption of generative AI are driving demand across manufacturing, finance, healthcare, and public services. Rising investment in data centers, domestic foundation models, and AI talent is positioning South Korea among the most advanced national AI economies.
Key Market Trends and Insights
- Generative AI and homegrown large language models are moving to the centre of the market as conglomerates and startups build Korean-language foundation models.
- Large data center and GPU investments by government, conglomerates, and global cloud providers are expanding the compute base that underpins AI services nationwide.
- Enterprise adoption is broadening quickly, with AI agents entering manufacturing, telecommunications, finance, and public administration across the South Korea artificial intelligence market.
Market Size and Forecast
- Market Size in 2025: USD 1370.90 Million
- Projected Market Size in 2035: USD 5842.30 Million
- CAGR from 2026 to 2035: 15.60%
- Fastest-Growing End Use Segment: Healthcare
Government policy and private investment are the primary forces lifting the market. In June 2026, the government, together with Samsung Electronics and SK Hynix, announced a national plan worth more than USD 576 billion to expand semiconductor and AI capacity over several years, one of the largest such commitments by any country. South Korea is also backing domestic foundation models, expanding GPU capacity, and integrating AI across industry and public services, and its strength in high-bandwidth memory used in AI servers gives it a structural advantage in supplying the hardware that AI workloads require.
The South Korea artificial intelligence market is gaining further momentum as generative AI shifts from pilots to production. Enterprises are deploying AI agents that plan and execute tasks across knowledge work, customer service, and factory operations, and telecom operators are rebuilding their businesses around AI services. Demand for machine learning and natural language processing is rising together as Korean-language models mature.
Companies in the South Korea artificial intelligence market are shifting from single-purpose tools toward full-stack platforms that combine proprietary models, compute infrastructure, and application layers under one roof. Conglomerates are directing R&D toward energy-efficient AI chips and on-device processing to reduce dependence on external cloud capacity, pairing that hardware push with deeper investment in vertical software for manufacturing, healthcare, and finance. Talent development and cross-border technology alliances are becoming central to this strategy, giving domestic firms both technology depth and the scale needed to compete globally.
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| South Korea Artificial Intelligence Market Report Summary | Description | Value |
| Base Year | USD Million | 2025 |
| Historical period | USD Million | 2019-2025 |
| Forecast Period | USD Million | 2026-2035 |
| Market Size 2025 | USD Million | 1370.90 |
| Market Size 2035 | USD Million | 5842.30 |
| CAGR 2019-2025 | Percentage | XX% |
| CAGR 2026-2035 | Percentage | 15.60% |
| CAGR 2026-2035 - Market by End Use | Healthcare | 17.8% |
| CAGR 2026-2035 - Market by Product and Service | Software | 19.4% |
Key Trends and Recent Developments
Samsung Electronics used its Galaxy Unpacked 2026 event in London to widen its on-device AI lineup, adding new foldable devices, AI-enabled Galaxy Glasses, and a refreshed One UI with generative assistants. The features span translation, imaging, and productivity across phones and wearables. Companies can use such consumer AI expansion to broaden everyday adoption across the market.
KT Corporation presented Agentic Fabric, a corporate AI operating system built to raise workplace productivity, alongside tools such as AI Builder and Agentic AICC. The platform coordinates AI agents across enterprise workflows and contact centres. Companies can use such enterprise platforms to move from single-task tools to coordinated automation across the South Korea artificial intelligence market.
Hyundai Motor Group signed an agreement with the government and Jeonbuk Province to build an integrated industrial hub worth about 9 trillion won, combining an AI data center, a robotics manufacturing cluster, and a green hydrogen plant. The complex ties compute capacity to physical AI and clean power. Companies can use such large-scale hubs to secure infrastructure for AI workloads across the South Korea artificial intelligence market.
Kakao started rolling out Kanana, its agentic AI, across KakaoTalk and related services, shifting from assistants that answer questions to systems that plan and complete tasks. The move turns AI into an orchestration layer for search, commerce, and messaging. Companies can use such platform-level AI to reach large consumer bases across the South Korea artificial intelligence market.
National AI Investment Scale-Up
Capital commitment has become the clearest signal of momentum in the South Korea artificial intelligence market. Government, conglomerates, and global technology firms are directing record sums toward chips, data centers, and foundation models, treating AI as a national economic priority. This wave of funding sets the pace for hiring, research, and infrastructure across the sector. The largest pledges pair public policy with private capital to secure a leading position in AI. In July 2026, South Korea announced a USD 950 billion package of AI cooperation initiatives with United States technology firms during a delegation visit to Silicon Valley, spanning chips, cloud capacity, and joint research.
Enterprise and Industrial AI Adoption
Adoption has moved beyond experimentation into everyday operations across the South Korea artificial intelligence market. Large employers are giving staff AI tools for routine work, and manufacturers are applying AI on the factory floor and in product design. This shift from pilots to production is a leading driver of demand. Companies are embedding AI agents that plan and execute tasks to raise productivity and shorten design cycles. In June 2026, Samsung, SK, and LG began rolling out enterprise AI agents to their full workforces for tasks such as email triage, meeting notes, and document search, and SK hynix has applied internal AI to semiconductor design, cutting layout turnaround by around 15 percent.
Sovereign Foundation Model Development
Control over core AI technology has become a strategic goal in the South Korea artificial intelligence market. Reliance on foreign models raises concerns over cost, data security, and continuity of access, prompting a national push for homegrown systems. The government has organised a competitive program to build foundation models from domestic data and architecture. Selected teams receive GPU and data resources and face public evaluations that narrow the field over time. In February 2026, a consortium led by Motif Technologies with KAIST advanced through the wildcard round of the national foundation model project, following earlier rounds that moved LG AI Research, SK Telecom, and Upstage into later stages.
AI Regulation and Governance
Clear rules are shaping how AI is built and sold in the country. Businesses have sought predictable obligations for high-impact systems, and policymakers have moved to balance innovation with safety and transparency. Regulation now forms part of the operating environment for every provider in the South Korea artificial intelligence market. The framework sets risk-based duties and oversight and supports continued development. The AI Framework Act took effect on January 22, 2026, making South Korea the second jurisdiction after the European Union to enact broad AI legislation, with provisions covering transparency, high-impact systems, and accountability.
AI Compute Infrastructure Build-Out
Computing power is the foundation on which the South Korea artificial intelligence market rests. Training and serving large models require vast clusters of accelerators, reliable power, and high-speed networking, and demand for these resources has outpaced supply. Public and private builders are racing to add capacity nationwide. Governments and companies are standing up hyperscale sites and securing advanced processors for large models and national research. In November 2025, the National AI Computing Center began initial services as a public-private venture delivering exascale-class computing across multiple sites, and under a procurement pact with NVIDIA the country is securing hundreds of thousands of advanced GPUs through 2030.
South Korea Artificial Intelligence Industry Segmentation
The Expert Market Research's report titled “South Korea Artificial Intelligence Market Report and Forecast 2026-2035” offers a detailed analysis of the market based on the following segments:
Market Breakup by Product and Service
- Hardware
- Software
- Service
Key Insight: Software holds the largest share of the market, covering foundation models, platforms, and applications that enterprises deploy across functions. In 2026, Naver expanded its HyperCLOVA X models and agentic services across its search and commerce platforms, deepening domestic software demand. Services is the fastest-growing category as demand rises for integration, customisation, and managed AI operations. Hardware remains substantial, supported by the country's leadership in AI semiconductors and high-bandwidth memory.
Market Breakup by Technology
- Machine Learning
- Natural Language Processing
Key Insight: Machine learning accounts for the largest share of the market, underpinning vision, prediction, recommendation, and industrial automation across sectors. Natural language processing is the fastest-growing technology as generative AI and Korean-language large language models move into products and services. In July 2026, the government opened a tender for a nationwide AI chatbot available to all citizens, drawing bids from major domestic firms and signalling strong demand for Korean-language models. The two technologies increasingly combine in multimodal systems that handle text, images, and speech.
Market Breakup by End Use
- Security
- Media and Advertising
- Retail
- Automotive
- Healthcare
- Manufacturing
- BFSI
- Professional Services
- Others
Key Insight: Manufacturing leads the South Korea artificial intelligence market, applying AI to quality control, predictive maintenance, and design across its industrial and semiconductor base. Healthcare is the fastest-growing end use, driven by AI diagnostics, imaging, and drug research. Media and advertising firms use AI for content generation and audience targeting, while retailers apply it to demand forecasting and personalized recommendations. Security, BFSI, automotive, and professional services add steady demand across defence, finance, mobility, and enterprise workflows. In 2026, the Ministry of National Defense launched a project to build a defense-specialised hyperscale AI platform, with competing consortia built around domestic foundation models.
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South Korea Artificial Intelligence Market Share
By product and service, software holds the largest share of the market on account of foundation models, platforms, and enterprise applications
Software leads the South Korea artificial intelligence market because foundation models, developer platforms, and packaged applications capture the largest portion of AI spending. Korean firms are releasing open and proprietary models that enterprises adopt across functions, deepening software demand. Falling deployment costs are widening access for smaller companies.
Services is the fastest-growing category as organisations need integration, fine-tuning, and managed operations to put models into production. Consulting, deployment, and support demand rises alongside adoption. Hardware retains a large base, anchored by domestic AI semiconductors and memory. In August 2026, Samsung Electronics unveiled its next-generation HBM4 memory for AI accelerators, reinforcing the country's hardware position.
By technology, machine learning dominates the market through broad applicability across vision, prediction, and automation
Machine learning holds the largest share of the South Korea artificial intelligence market because deep learning underlies most deployed AI, from computer vision in factories to recommendation and forecasting in services. In January 2026, Boston Dynamics and Google DeepMind said production Atlas humanoid robots running Gemini Robotics models would begin shipping to Hyundai's robotics facility in Korea, showing how machine learning drives vision and control. Continued model training and tooling investment sustain its lead.
Natural language processing is the fastest-growing technology as generative AI and Korean-language models enter search, customer service, and productivity tools. Rising demand for chatbots, agents, and document intelligence is accelerating its growth. Multimodal systems that pair language with vision are extending its reach.
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By end use, manufacturing leads the market through the country's industrial base and smart factory adoption
Manufacturing accounts for the largest share of the South Korea artificial intelligence market, reflecting the country's strength in electronics, automotive, and semiconductors. Smart factories apply AI to quality inspection, predictive maintenance, and process optimisation, and chipmakers use AI to speed design. Industrial demand continues to broaden as more plants digitise.
Healthcare is the fastest-growing end use as hospitals and medical firms adopt AI for imaging, diagnostics, and drug discovery. In late 2025, Samsung introduced its R20 ultrasound system with AI-based measurement and diagnostic tools for clinical use. Security, BFSI, and automotive applications add momentum through defence AI, fraud detection, and autonomous driving. Public services are also expanding AI use in administration and citizen support.
Competitive Landscape
The industry is becoming increasingly innovation driven as major South Korea artificial intelligence market players compete on foundation models, AI semiconductors, cloud infrastructure, and enterprise platforms. Conglomerates, telecom operators, and startups are building Korean-language models, expanding data centres, and embedding AI agents across products and services. Partnerships with global technology firms and government-backed projects are shaping competitive positions.
Major South Korea artificial intelligence companies are also prioritising sovereign models, on-device AI, and industry-specific solutions to secure long-run demand. Opportunities are growing in manufacturing, healthcare, finance, and public services, and in the compute and memory that AI workloads require. Firms that combine model quality, infrastructure scale, and strong integration are positioned to lead in the coming years.
Samsung Electronics Co. Ltd
Founded in 1969 and headquartered in Suwon, South Korea, Samsung Electronics Co. Ltd supports the South Korea artificial intelligence market through its Gauss family of generative AI models and, via its Samsung SDS arm, the FabriX generative AI platform and the Brity Copilot work assistant sold to enterprise clients. Samsung Research leads the group's core AI development across natural language, computer vision, and the Bixby voice assistant.
SK Telecom Co., Ltd.
Founded in 1984 and headquartered in Seoul, South Korea, SK Telecom Co., Ltd. is transforming into an AI-centric company through its A. consumer assistant and its A.X proprietary foundation models. The operator is building large-scale AI data center capacity, including a major facility in Ulsan developed with a global cloud provider, and offers enterprise AI services across industries.
KT Corporation
Founded in 1981 and headquartered in Seongnam, South Korea, KT Corporation develops enterprise and public-sector AI under its AI transformation strategy. The company partnered with Microsoft in a multibillion-dollar alliance to build Korean-language AI models on cloud infrastructure and is applying AI across networks, smart cities, and contact centres.
LG Corporation
Founded in 1947 and headquartered in Seoul, South Korea, LG Corporation drives AI through LG AI Research, which develops the EXAONE family of foundation models. In 2026 it released K-EXAONE 2.0, a large open-source model, and is embedding AI agents across its manufacturing, appliance, and enterprise operations.
Other key players in the market include Kakao Enterprise Co. Ltd., Microsoft Corporation, Google LLC, Amazon Web Services, Inc., and Riiid, Inc., among others.
*Please note that this is only a partial list; the complete list of key players is available in the full report. Additionally, the list of key players can be customized to better suit your needs.*
Key Highlights of the South Korea Artificial Intelligence Market Report
- Comprehensive assessment of AI hardware, software, and services demand across South Korea.
- Analysis of machine learning and natural language processing adoption in industry and consumer services.
- Detailed benchmarking of leading domestic conglomerates, telecom operators, and global cloud providers.
- Segment opportunity analysis spanning manufacturing, healthcare, security, BFSI, and automotive end uses.
- Strategic insights into foundation models, data center expansion, and enterprise AI agents.
Why Rely on Expert Market Research?
- Analysts tracking foundation models, compute infrastructure, and national AI policy.
- Research combining conglomerate strategies, startup activity, and government initiatives.
- Rigorous methodology integrating primary interviews with verified secondary intelligence.
- Actionable recommendations supporting investment, partnership, and market entry decisions.
- Forward-looking insights identifying emerging technologies and shifting demand across end uses.
Call to Action
Unlock the latest insights with our South Korea artificial intelligence market trends 2026 report. Discover segment dynamics, technology adoption, and key industry players. Stay ahead of competition with trusted data and expert analysis. Download your free sample report today and drive informed decisions in the market.
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*While we strive to always give you current and accurate information, the numbers depicted on the website are indicative and may differ from the actual numbers in the main report. At Expert Market Research, we aim to bring you the latest insights and trends in the market. Using our analyses and forecasts, stakeholders can understand the market dynamics, navigate challenges, and capitalize on opportunities to make data-driven strategic decisions.*
Key Questions Answered in the Report
In 2025, the market value was USD 1370.90 Million.
The market is projected to grow at a CAGR of 15.60% between 2026 and 2035.
The market is estimated to witness a healthy growth in the forecast period of 2026-2035 to reach around USD 5842.30 Million by 2035.
The major drivers include the increasing government investment in AI, and incorporation of AI in automotive manufacturing and healthcare sectors.
Growth of homegrown foundation models, large-scale data center and GPU investment, enterprise AI agent adoption, and strong government support are the leading trends.
The major technologies considered in the market report include machine learning and natural language processing.
The major end uses include security, media and advertising, retail, automotive, healthcare, manufacturing, BFSI, and professional services.
The key players include Samsung Electronics Co. Ltd, SK Telecom Co., Ltd., KT Corporation, LG Corporation, Kakao Enterprise Co. Ltd., Microsoft Corporation, Google LLC, Amazon Web Services, Inc., and Riiid, Inc., among others.
Report Summary
Explore our key highlights of the report and gain a concise overview of key findings, trends, and actionable insights that will empower your strategic decisions.
| REPORT FEATURES | DETAILS |
| Base Year | 2025 |
| Historical Period | 2019-2025 |
| Forecast Period | 2026-2035 |
| Scope of the Report |
Historical and Forecast Trends, Industry Drivers and Constraints, Historical and Forecast Market Analysis by Segment:
|
| Breakup by Product and Service |
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| Breakup by Technology |
|
| Breakup by End Use |
|
| Market Dynamics |
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| Competitive Landscape |
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| Companies Covered |
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