USD 1.4 billion
Report ID:
SQMIG35G2329 |
Region:
Global |
Published Date: June, 2025
Pages:
194
|Tables:
117
|Figures:
72
Global AI in Medical Diagnostics Market size was valued at USD 1.4 billion in 2023 and is poised to grow from USD 1.74 billion in 2024 to USD 10.06 billion by 2032, growing at a CAGR of 24.5% during the forecast period (2025-2032).
The global AI in medical diagnostics market growth is fueled by the rising need for disease detection at early stages, the adoption of AI in healthcare IT systems, and a lack of diagnostic experts. Governments and healthcare systems across the world are dedicating efforts to capitalizing on AI to improve clinical decision making and make diagnostic processes more efficient. These efforts are complemented by the public. For example, in May 2024, the UK's National Health Service (NHS) rolled out its deployment of AI equipment throughout radiology departments across the country under the AI Diagnostic Fund. These tools consist of equipment like Behold.ai and Annalise.ai, which assist radiologists in recognizing abnormalities in X-rays and CT scans with great speed and accuracy. NHS England said that AI cut the mean chest X-ray turnaround time from 11 days to less than 48 hours, substantially enhancing cancer detection rates and patient triaging. The AI in medical diagnostics market is also seeing robust traction from tech companies and academic collaborations which is resulting in shorter cycles of innovation. Greater use of imaging analytics, AI-driven pathology software, and predictive health models will keep the market moving forward.
What Makes AI Integration Crucial in AI in Medical Diagnostics Market?
Artificial Intelligence (AI) revolutionized medical diagnostics by making faster, more precise and more scalable diagnostic answers possible reshaping clinical processes and results. AI systems trained in vast amounts of clinical and imaging data now assist doctors in identifying intricate patterns that might be hard to detect using conventional approaches. These solutions greatly improve the accuracy of diagnostics and minimize the role of human error and integrating AI becomes a must for healthcare's future.
In March 2025, the FDA approved Siemens Healthiness AI Rad Companion Chest CT software making it the first AI driven CT solution accepted for clinical detection of lung nodules. By the middle of 2025 the tool had been implemented in more than 150 hospitals throughout the United States. Its execution resulted in a 30% decrease in the average diagnosis time and a 15% improvement in nodule detection sensitivity when compared to conventional radiologist assessments.
Market snapshot - 2025-2032
Global Market Size
USD 1.4 billion
Largest Segment
services
Fastest Growth
software
Growth Rate
24.5% CAGR
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Global AI in Medical Diagnostics Market is segmented by Component, End User, Modality, Application and region. Based on Component, the market is segmented into Software, Services and Hardware. Based on End User, the market is segmented into Hospitals, Diagnostic Imaging Centers, Diagnostic Laboratories and Other End Users. Based on Modality, the market is segmented into Imaging Modalities and Diagnostics Modalities. Based on Application, the market is segmented into In Vivo Diagnostics Applications and In Vitro Diagnostics Applications. Based on region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & Africa.
The services component is the largest component of the AI in medical diagnostics market as implementing AI in healthcare systems, with all existing workflows, is multifaceted and still being developed. AI is not simply another software or hardware package. It requires continuous customization, regulatory compliance (FDA, HIPAA), and iterative integration into existing health systems. Services are offered by professional services firms to assist with data annotation, model training, and validation. All of which are critical steps to ensure that the models are working accurately and reliably, which is paramount in medical diagnostics.
Whereas, the demand for software in AI in medical diagnostics sector is predicted to have heavy growth as the need for medical diagnostic AI software is gaining traction. AI can help with accuracy, speed, and scale when approaching disease detection. Machine learning algorithms for image reading, predictive diagnostics, and automated reporting are driving adoption and cloud (AI) platforms are helping speed integration into health systems.
Radiology is leading the AI in medical diagnostics market by a wide margin as it relies heavily on standardized imaging data (X-rays, MRIs, CT scans), which is necessary for AI-oriented analysis. Radiology involves a range of repetitive tasks (fracture detection, tumor detection, hemorrhagic detection) at high volumes and AI can improve speed, accuracy, and workflow in these procedures. Over 100+ legally marketed FDA-approved AI radiology tools (Aidoc-stroke detection; Zebra-Med - incidental findings) are currently used and accepted in clinical practice and are well ahead, in terms of adoption, relative to other specialty fields.
Whereas the higher demand for AI in oncology diagnostics is propelled by its potential to improve early cancer detection, better characterize tumours, and provide personalized treatment plans. AI tools for mammography, lung nodules, and genomic profiling are quickly developing, with considerable driver for precision medicine and the ability to speed up more precise diagnostics.
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North America leads AI in medical diagnostics market due to its robust healthcare infrastructure, significant adoption of healthcare IT, substantial investment in AI research, and an accommodating regulatory framework. North America is home to top technology and healthcare firms encouraging educational institutions and startups that drive innovation in AI-powered diagnosis. In 2025, this leadership was further strengthened as the U.S. government enlarged its AI Health Initiative allocating more than $150 million in funding to aid the incorporation of AI into public hospitals and diagnostic facilities. Additionally, the FDA's readiness to endorse AI powered diagnostic tools led to expedited approval processes and faster market entry for innovative methods. Collectively these elements reinforce North America's prominent role as the hub for AI driven diagnostics consequently hospitals and laboratories can provide faster and improved care throughout the region.
The U.S. dominated the artificial intelligence (AI) in medical diagnostics market. This expansion is fuelled by progress in AI for medical diagnosis, increasing need for timely and precise disease identification application of AI in healthcare IT services and supportive government regulations.
For instance, in 2025 the U.S. government broadened its AI Health Initiative by allocating over $150 million to public hospitals and diagnostic centers to advance the use of AI technology. Employing AI technology enhances the precision of diagnostics, optimizes time factors that frequently fluctuate at healthcare centres and makes better use of services and resources. Hospitals and laboratories with the necessary tools to deliver quicker and more precise patient care throughout the region.
Artificial intelligence (AI) has developed a strong growth path in Canada concerning its market in medical diagnostics. This momentum is particularly apparent in the need for prompt and precise disease identification, the incorporation of AI into healthcare IT frameworks, and backing from the government. By 2025 Canada aims to enhance healthcare via AI as evidenced by advancements aimed at implementing AI tools, refining diagnostic methods, improving patient outcomes and addressing the issue of a shortage of qualified healthcare professionals. These measures will enhance Canada's significant position in North America's AI medical diagnostics market and will also foster the continued progress of healthcare innovation throughout North America.
The expansion of AI in medical diagnostics sector is remarkable in the Asia-Pacific area driven by various factors linked to demographics, technology and regulations. The Asia-Pacific area is facing a rising burden of chronic illnesses such as cardiovascular diseases, diabetes, and cancer leading to an increasing need for more sophisticated diagnostic solutions. These AI driven platforms play an essential role in the prompt identification and handling of illnesses allowing patients to modify their treatment and management of their condition using advanced and tailored approaches
By 2025 the AI in medical diagnostics market of South Korea is experiencing growth driven by advancements in technology government support and funding along with the integration of AI into the healthcare system. These elements are bolstered by robust experience and backing from the South Korean government in the integration of AI into healthcare systems through substantial investment, policies and more. The existence of leading companies in electronics like Samsung and advanced performance capabilities will further strengthen the nation's initiatives to penetrate this AI in medical diagnostics sector and sustain its development.
The AI in medical diagnostics market in Japan is expected to expand swiftly due to technological progress an aging demographic and particular developments in both precision medicine and AI diagnostics. The AI in medical diagnostics industry is projected to expand quickly driven by the implementation of AI technologies in diagnostic applications within radiology and pathology. AI is currently utilized to identify diseases faster and enhance diagnostic precision. Additionally, the expansion of AI in medical diagnostics is bolstered by new government funding initiatives and collaborations between tech companies and healthcare organizations positioning Japan to have a substantial impact on the global market for AI in medical diagnostics.
Europe is working on incorporating AI into medical diagnostics while also striving to balance innovation with adequate regulatory safeguards. The essential element of this process is the EU AI Act, which is a regulation on artificial intelligence that establishes a risk-based structure for classifying AI applications. Medical diagnostics frequently fall under the 'high-risk' category. This implies a substantial array of requirements such as a comprehensive risk management system, stringent compliance verification, and continual oversight for safety and data security.
In the year 2025, the artificial intelligence (AI) in medical diagnostics industry in the United Kingdom is growing rapidly due to several factors, one of which is an increase in demand for improved healthcare. The increasing burden of chronic disease, which requires the need for better early, and accurate diagnostic solutions to manage patient pathways and important patient safety issues. In addition to infrastructure alone, the UK has made a commitment to further develop and enhance AI in medical diagnostics as seen through various initiatives aimed at improving healthcare systems, such as the establishment of partnerships between technology companies and medical organizations, specific investments in research and development.
By 2025 the AI in medical diagnostics market in France is witnessing swift expansion due to technological advancements and the escalating complexity of healthcare needs. In terms of technology deep learning has become the area with the highest revenue generation whereas natural language processing (NLP) is expected to be the quickest expanding segment in the French AI medical imaging industry. These technologies are being employed in additional diagnostic applications with the aim of enhancing clinical efficiency and advancing patient outcomes.
AI tools will significantly penetrate the markets of radiology, pathology, and clinical decision support systems, aiding healthcare providers in enhancing diagnostic precision. This will reduce the burden on healthcare workers and facilitate a quicker decision-making process. The rising elderly population, along with the escalating occurrence of chronic illnesses (cancer, heart diseases) is creating a demand for enhanced diagnostic solutions in Germany.
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Advances in Technology
Integration of Smart Cities with Government Plans
Costly up-Front Investment of Funds
Data Security and Customer Privacy Concerns
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The AI in medical diagnostics market is highly competitive and notably dynamic with companies channeling resources into innovative technologies to boost diagnostic precision streamline workflows and develop product offerings that integrate AI in imaging pathology, genomics and predictive analytics. Businesses often form strategic collaborations or alliances to exchange knowledge and collectively enhance healthcare results through the implementation of new technologies.
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
As per SkyQuest analysis, government backing of smart city projects, and AI developments are considered some of the factors precipitating the sudden boom of AI in medical diagnostics market. The convergence of technological advancements, increasing healthcare demands, and global funding has made AI in medical diagnostics a crucial component of today’s diagnostics market. However, there are still hindrances that industry must overcome effectively, including high costs of installation and data privacy issues. AI in diagnostics will increasingly become a key driver due to increased urbanization and digital infrastructure expansion. It will help doctors to assist in identifying intricate patterns that might be hard to detect using conventional approaches.
Report Metric | Details |
---|---|
Market size value in Medical | USD 1.4 billion |
Market size value in 2032 | USD 10.06 billion |
Growth Rate | 24.5% |
Base year | 2024 |
Forecast period | 2025-2032 |
Forecast Unit (Value) | USD Billion |
Segments covered |
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Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
Companies covered |
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Table Of Content
Executive Summary
Market overview
Parent Market Analysis
Market overview
Market size
KEY MARKET INSIGHTS
COVID IMPACT
MARKET DYNAMICS & OUTLOOK
Market Size by Region
KEY COMPANY PROFILES
Methodology
For the AI in Medical Diagnostics Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the AI in Medical Diagnostics Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
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Global AI in Medical Diagnostics Market size was valued at USD 1.11 billion in 2023 and is poised to grow from USD 1.48 billion in 2024 to USD 9.88 billion by 2032, growing at a CAGR of 27.9% during the forecast period (2025–2032). The global AI in medical diagnostics market growth is fueled by the rising need for disease detection at early stages, the adoption of AI in healthcare IT systems, and a lack of diagnostic experts. Governments and healthcare systems across the world are dedicating efforts to capitalizing on AI to improve clinical decision making and make diagnostic processes more efficient. These efforts are complemented by the public. For example, in May 2024, the UK's National Health Service (NHS) rolled out its deployment of AI equipment throughout radiology departments across the country under the AI Diagnostic Fund. These tools consist of equipment like Behold.ai and Annalise.ai, which assist radiologists in recognizing abnormalities in X-rays and CT scans with great speed and accuracy. NHS England said that AI cut the mean chest X-ray turnaround time from 11 days to less than 48 hours, substantially enhancing cancer detection rates and patient triaging. The AI in medical diagnostics market is also seeing robust traction from tech companies and academic collaborations which is resulting in shorter cycles of innovation. Greater use of imaging analytics, AI-driven pathology software, and predictive health models will keep the market moving forward.
The AI in medical diagnostics market is highly competitive and notably dynamic with companies channeling resources into innovative technologies to boost diagnostic precision streamline workflows and develop product offerings that integrate AI in imaging pathology, genomics and predictive analytics. Businesses often form strategic collaborations or alliances to exchange knowledge and collectively enhance healthcare results through the implementation of new technologies. 'Qure.ai', 'Zebra Medical Vision', 'Caption Health', 'Lunit', 'Bay Labs', 'Corti', 'PathAI', 'Arterys', 'Aiforia', 'DeepTek', 'Enlitic', 'Aidoc', 'Freenome', 'Kheiron Medica', 'Behold.ai'
The AI in medical diagnostics industry is witnessing swift development and advancement in AI driven by improvements in deep learning, computer vision and natural language processing. These technologies allow AI tools to analyze and understand complex medical data such as imaging scans, pathology slides, and genetic profiles, and do this accurately. The adoption of AI-supported diagnostic tools is progressively becoming essential for clinicians aiming to enhance value through improved decision making and better patient outcomes.
Expansion of AI in Radiology and Pathology: AI is progressively being incorporated into radiology and pathology processes transforming how medical images and biopsy slides are examined. Deep learning algorithms are capable of detecting diseases such as cancers, brain hemorrhages and pulmonary embolisms with a significant degree of accuracy. By 2025 radiology departments across North America and Europe indicated that they had adopted AI tools such as Aidoc and PathAI which reduced diagnostic turnaround times demonstrating that AI is increasingly making headway in settings where differential diagnosis is essential.
Why Does North America Lead the AI in Medical Diagnostics Market?
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