AI adoption rate is much faster than smartphone or e-commerce adoption: UBS

New Delhi [India], September 23 (ANI): Artificial Intelligence (AI) acceptance is strengthening as the rate of adoption has improved from 9.2 per cent in the US in the second quarter of 2025 to 9.7 per cent in third quarter of 2025, continuing the steady growth trend, said a report by investment bank and financial services firm UBS.

The report added that this puts the industry on track to reach the key milestone of a 10 per cent AI adoption rate by the end of the year. This is a threshold often seen as the tipping point before widespread exponential growth in technology cycles.

It has taken just three years to reach the initial 10 per cent adoption rate, versus five years for smartphones and a much longer 24 years for e-commerce, the report added.

"Generative AI should take only three years to reach the first 10 per cent adoption rate in the US, versus five years for smartphones and 24 years for e-commerce", noted the report.
This accelerated pace suggests the AI industry may soon enter what analysts term the "exponential adoption phase."

Drawing parallels with the smartphone boom, the report notes that once smartphones crossed the 10 per cent adoption mark, penetration surged from 10 per cent to 68 per cent over the following five years -- driven by a rapidly maturing ecosystem including app stores, larger devices, and cost-effective platforms like Android.

Similarly, AI's ecosystem is showing signs of readiness for a rapid scale-up. Key drivers include advances in reasoning models, strong enterprise commitments from both large firms and SMEs, and robust funding trends that are reinforcing innovation and reducing costs.

The UBS report said that the recent quarterly report from the US Census Bureau on the results of its Business Trends and Outlook Survey, which tracks AI adoption across more than a million firms in the US, showed steady sequential improvement in the AI adoption rate.

The report noted, "We expect the AI industry to reach the key milestone of a 10 per cent adoption rate by end-2025. In this blog, we compare the generative AI adoption cycle with the previous e-commerce and smartphone tech cycles."

"We conclude that there is a high likelihood that the AI industry will soon enter an exponential adoption phase which should disproportionately benefit companies exposed to the intelligence and application layers," the report added.

Comparing the current AI adoption cycle with previous technological shifts -- notably smartphones and e-commerce -- the report points to generative AI as among the fastest-adopting technologies in US history.

Given these dynamics, UBS believe companies operating in the intelligence and application layers of the AI stack are best positioned to benefit from the next wave of growth. (ANI)