European AI Spending Forecast to Hit $470 Billion by 2030

European expenditure on artificial intelligence is projected to reach approximately $470 billion by 2030, representing a compound annual growth rate (CAGR) of 35.0% during the 2025–2030 forecast period, according to IDC. Generative AI solutions are already being integrated into enterprise deployments and are expected to constitute more than 55% of the total market by the end of the decade.

Operational readiness for AI in Europe is no longer a primary concern; rather, the focus has shifted to maturity and the extent of integration of agentic AI within business operations. A detailed analysis of Central and Eastern Europe (CEE) alongside Western Europe (WE) indicates that both regions are advancing toward an agentic AI future at varying velocities. Although CEE is in the earlier stages of adoption, it is growing significantly above the global average, narrowing the gap more rapidly than its market size might suggest.

AI platforms and GenAI solutions continue to provide measurable returns in cost efficiency, customer experience, and risk management. Enterprises are accelerating the reallocation of budgets toward AI despite tariff-driven supply chain disruptions and geopolitical tensions. Software remains the primary growth driver, expanding at a 43.9% CAGR, with AI platforms reaching 61.1%, as the proliferation of agentic components shifts organizations from single-purpose assistants toward multi-agent systems operating with minimal human oversight. The EU AI Act now serves as a mandatory compliance timeline, with most high-risk transparency obligations having taken effect on August 2, 2026.

IDC forecasts that European AI spending will sustain robust double-digit growth through 2030, supported by the expansion of AI platforms, cloud-native development, and the integration of industry-specific AI into corporate strategies. Agentic AI serves as the primary catalyst. However, regulatory fragmentation resulting from the phased implementation of the EU AI Act, a persistent talent shortage, and cloud cost optimization pressures present primary risks, driving demand for AI governance and assurance services.

The banking sector represents the largest segment of AI expenditure in Europe, accounting for 12.6% of the market in 2026 (rising to 19.2% when including insurance and capital markets). Primary use cases include fraud analysis, threat intelligence, and contact-center automation. Institutions are transitioning from pilot projects to mission-critical multi-agent automation. Software and information services rank second, with AI infrastructure provisioning representing more than half of the sector's total expenditure.

Retail occupies the third position in market spending. Digital commerce remains the primary use case, followed by AI-enhanced customer service and infrastructure provisioning. Retailers are moving swiftly toward high-ROI applications; IDC research indicates that certain fashion retailers utilizing in-house AI platforms have reported significant time savings, while others have integrated ChatGPT-based shopping into the customer experience.

Among the most rapidly expanding industries, healthcare providers lead with a 41.0% CAGR. Clinical workflow and resource optimization constitute nearly two-thirds of the market in 2026. For instance, the UK’s NHS is scaling AI ambient scribing to 20,000 clinicians, while Romania’s NRRP-funded e-health program connects over 25,000 providers. Banking, insurance, and life sciences are also exhibiting growth rates above the European average.

“Despite geopolitical tensions and supply chain challenges, European AI investment is the priority that organizations protect first during budget reductions,” stated Carla La Croce, research manager for Data and Analytics at IDC. “The market is transitioning from experimental usage to strategic, operational deployment, with a focus on efficiency, risk mitigation, and resilience.”