ServiceNow research reveals that while AI spending is surging across the UAE, many enterprises are discovering that governance, data readiness and operational integration will determine who turns investment into business value
The UAE has spent the last several years positioning itself as one of the world’s most ambitious artificial intelligence markets. From national AI strategies and government-backed innovation initiatives to aggressive enterprise investments, the country has built a reputation as an early adopter of emerging technologies.
But as AI moves from experimentation to enterprise-wide deployment, a new reality is emerging.
According to ServiceNow’s latest Enterprise AI Maturity Index, UAE organizations are no longer being measured by how enthusiastically they adopt AI, but by how effectively they can operationalize it. The report paints a picture of a market that remains highly committed to AI transformation, yet increasingly challenged by the practical realities of scaling the technology across complex business environments.
The numbers tell an interesting story. AI spending among UAE organizations has increased by an impressive 105 percent year over year, and businesses expect AI to account for nearly one-fifth of total IT budgets by 2027. Yet despite this substantial financial commitment, the country’s overall AI maturity score stands at 48 out of 100.
The finding suggests that investment alone is not enough.
From AI Hype to AI Reality
For many organizations, the first phase of AI adoption was relatively straightforward. Pilot projects could be launched within individual departments, generative AI tools could be deployed to improve productivity, and leadership teams could establish AI strategies and innovation agendas.
The second phase is proving far more difficult.
Today, enterprises are attempting to scale AI across entire organizations, integrating it into operations, customer service, workflows and decision-making processes. That shift requires more than technology. It demands connected systems, trusted data, governance frameworks and workforce readiness.
Many UAE organizations are discovering that these foundations are still under construction.
The ServiceNow report shows that while companies have made meaningful progress in leadership commitment and AI strategy, execution remains constrained by fragmented technology environments and disconnected workflows. AI initiatives frequently operate in silos, preventing organizations from extracting enterprise-wide value.
As a result, the enthusiasm surrounding AI is increasingly being matched by questions about how to implement it at scale.
The Agentic AI Gap
Few technologies have generated as much attention in 2026 as agentic AI.
The concept promises autonomous systems capable of making decisions, coordinating tasks and completing workflows with minimal human intervention. Across the region, executives have identified agentic AI as a key driver of future business transformation.
Yet the ServiceNow findings suggest reality remains some distance from the vision.
More than half of UAE organizations have already implemented some form of agentic AI. On paper, that appears impressive. However, only 7 percent have progressed to building truly autonomous workflows.
“The UAE remains one of the world’s most ambitious AI markets. While organisations have built the financial and strategic commitment to AI, the ones pulling ahead are moving from AI pilots to AI orchestration, connecting legacy systems, data, governance and AI agents in one control tower. That’s where enterprise-wide execution begins,” said Saif Mashat, VP – Middle East & Africa at ServiceNow.
This reveals an important distinction.
Most organizations are currently using AI to assist employees rather than replace or autonomously execute business processes. AI may help draft communications, analyze data or recommend actions, but humans still remain at the center of decision-making and workflow orchestration.
That cautious approach reflects lingering concerns around trust, governance and accountability. Before organizations can hand over greater levels of autonomy to AI systems, they need confidence that those systems can operate transparently, securely and consistently.
Data: The Persistent Obstacle
Talk to any AI leader and the conversation inevitably returns to data.
The UAE findings reinforce this reality. More than 77 percent of executives surveyed cited data quality, accessibility and management issues as major barriers to AI adoption.
This challenge is hardly unique to the UAE, but its importance cannot be overstated.
Artificial intelligence is only as effective as the information it receives. When data is scattered across multiple platforms, trapped in departmental silos or managed inconsistently, AI systems struggle to generate meaningful insights and reliable outcomes.
For many enterprises, the biggest obstacle to AI transformation is no longer finding the right model. It is creating a unified data foundation that allows those models to deliver business value.
Legacy Systems Continue to Hold Organizations Back
Alongside data challenges, many organizations are contending with decades of accumulated technology infrastructure.
Only 14 percent of UAE organizations surveyed have replaced legacy technology with integrated platforms. The majority continue to operate across disparate systems that were never designed to work seamlessly together.
This creates a fundamental challenge for AI.
An AI solution deployed into fragmented environments can improve individual tasks, but it struggles to transform complete business processes. Without integration, organizations risk creating isolated pockets of automation rather than achieving true digital transformation.
The result is often a collection of successful pilot projects that fail to deliver enterprise-wide impact.
What Separates AI Leaders from Everyone Else?
Perhaps the most striking insight from the report is that the most mature AI organizations are not necessarily those spending the most money.
Instead, they are the organizations taking a broader and more disciplined approach to transformation.
These companies build unified AI strategies, modernize data environments, invest in workforce skills, create governance frameworks and integrate AI directly into operational workflows. They treat AI as a business capability rather than a standalone technology project.
The payoff is significant.
Organizations with higher AI maturity report average returns on investment of 160 percent, rising to an expected 194 percent within the next two years. They are also substantially more productive, more successful at scaling AI initiatives and more effective at managing risk.
Yet despite these proven benefits, only 16 percent of UAE organizations have implemented comprehensive AI testing, auditing and risk-management processes.
That gap may represent both the greatest challenge and the greatest opportunity.
The Next Phase of UAE AI Leadership
The UAE has already demonstrated that it can lead in AI adoption. Government vision, corporate investment and market enthusiasm are firmly in place.
The next chapter will be different.
Success will no longer be defined by how many AI projects an organization launches or how much it spends. Instead, leadership will belong to those enterprises that can connect systems, unify data, embed governance and translate AI investments into measurable operational outcomes.
The race is shifting from experimentation to execution.
And for UAE enterprises, that may prove to be the most important AI challenge yet.
