UAE companies have achieved remarkable growth in AI adoption, with the percentage of businesses using these technologies rising to 72%, compared to 53% the previous year—an annual increase of 36%—according to a report issued by Amazon Web Services (AWS) in collaboration with the UAE Artificial Intelligence Office.
The report, "Unlocking the Full Potential of AI in the UAE 2026," prepared by research firm Strand Partners, explained that companies operating in key sectors within the country have increasingly adopted AI and cloud computing, coinciding with increased investments in digital infrastructure and professional skills development.
This progress represents a 19-percentage-point increase in the proportion of companies adopting AI compared to the previous year. The report also noted that 85% of companies using these technologies reported an acceleration in their digital transformation, amid expectations that this trend will continue in the coming years.
AI Supports the Competitiveness of the UAE Economy
The high rates of AI adoption in the UAE reflect the country's efforts to translate its national strategy in this field into practical applications within institutions and companies.
Dr. Abdulrahman Al Mahmoud, Director at the UAE Artificial Intelligence Office, said the country views AI as a driver of economic growth, improving services, and enhancing future competitiveness. He pointed to the importance of providing an environment that helps institutions innovate, scale technical solutions, and achieve tangible results for society.
This expansion comes at a time when companies are moving beyond the testing phase of AI tools and transitioning to integrating them more broadly into operational processes and customer services.
Multi-Billion Dirham Investments in Cloud Computing
Cloud computing plays a fundamental role in supporting the spread of AI, as it allows companies to access scalable computing capabilities and advanced technologies without needing to build all the technical infrastructure internally.
In this context, AWS announced investments of up to 20.1 billion dirhams, equivalent to about $5.47 billion, in the AWS Middle East cloud region in the UAE by 2037. The company expects these investments to contribute about 41 billion dirhams, or $11.16 billion, to the country's GDP.
The company also collaborated with e& enterprise to launch the AWS UAE Sovereign Launchpad, certified by the UAE Cyber Security Council, aiming to give government entities and companies greater control over data and meet regulatory compliance requirements.
AWS is also supporting a $1 billion investment with e& to develop sovereign cloud computing and AI capabilities.
Chris Erasmus, General Manager of AWS in the UAE and the Middle East and North Africa (MENA) region, said companies have started shifting from asking whether they can use AI to focusing on how to optimize the use of its applications responsibly. He added that investments in infrastructure, partnerships, and skills development aim to help institutions turn technical experiments into practical results.
According to the report, companies including Property Finder, Virgin Mobile UAE, the Entertainer, and Careem are leveraging AWS cloud technologies and generative AI to support operational processes and improve customer services.
Skills and Funding Shortages Among Key Challenges
Despite the rapid growth in AI use in the UAE, the report identified a set of challenges that require more attention to ensure the broader utilization of these technologies.
These challenges include expanding access to secure cloud infrastructure, developing regulatory frameworks that encourage innovation, addressing the shortage of specialized AI talent, and improving access to funding, especially for startups and small and medium enterprises (SMEs).
Consequently, the report stressed the importance of moving from achieving limited efficiency improvements to re-engineering operational processes and integrating AI more deeply into business models.
In the context of skills development, AWS is working through the "AI Nation – Afaaq" program to provide free training on its technologies to 30,000 people in the UAE. The company is also collaborating with the Mohamed bin Zayed University of Artificial Intelligence (MBZUAI) and supporting the "Qudwatech" career mentoring program aimed at developing the skills of Emirati women in the technology sector.
Four Pillars to Enhance AI Proliferation
The report identified four key areas to support the continued growth of AI adoption in the UAE: accelerating the responsible use of technologies, maintaining a regulatory environment that stimulates innovation, bridging the specialized skills gap, and expanding available funding for companies operating in this field.
The report believes that the next phase will not only depend on increasing the number of companies using AI but will also hinge on the ability of institutions to translate these technologies into deeper changes in work methods, production, and service delivery.
The announcement of the results coincided with the AWS Summit in Dubai, which brought together executives, companies, and developers to discuss the future of cloud computing and AI applications, indicating the growing importance of digital technologies in the UAE's economic transformation trajectory.
