The artificial intelligence market grew from $136 billion in 2022 to $192 billion in 2023 and is projecting upward for the rest of the decade.
According to Grand View Research, the AI market is set to expand at a compound annual growth rate (CAGR) of 37.3% from 2023 to 2030.
Now, a burgeoning number of corporate titans want a big slice of that market and are willing to push piles of cash on the table to get the job done.
Exhibit “A” is KPMG, the London, UK-based audit, tax, and financial advisory service that earned over $34.64 billion in 2022.
The company is looking to add to those revenue numbers via a new AI and cloud computing partnership with Microsoft. KPMG is so high on the project it’s investing $2 billion in the partnership. Furthermore, it’s expected to rake in $12 billion in additional revenues over the next five years.
That would translate into a 7% revenue boost for the company and would also mean KPMG is getting a big foothold in the technology end of the financial services market, according to projections from The Wall Street Journal.
Microsoft CEO Satya Nadella is a big backer of the partnership, noting the expanding power of AI and cloud systems can cover a ton of corporate ground for companies like KPMG.
“Whether it’s ESG reporting or audit, all of these things are going to be fundamentally transformed because the core processes of those knowledge workflows are going to be accelerated using this AI technology.”
The deal isn’t expected to result in major job losses for KPMG, although the company has laid off about 2,700 employees in the face of strong economic headwinds.
“I certainly don’t expect that we’ll lay off a lot of people because we’ve invested in this partnership,” said Bill Thomas, KPMG global chair and CEO. “I would expect that our organization will continue to grow and we will reskill people to the extent possible and, frankly, create all sorts of opportunities in ways that we can’t even imagine yet.”
Opening Up New Possibilities
The partnership is largely intended to develop Generative AI tools for KPMG, its business partners, and its customers. That objective would replace some current company business technologies over the next half-decade.
“I think some of the legacy ways of doing business executing services are going to become obsolete,” said KPMG Advisory head Carl Carande, in comments to Business Insider.
Right off the bat, KPMG is expected to leverage Microsoft’s 365 Copilot, a generative AI tool that can help the company drill down and gain information on stock market trends, economic forecasts, and corporate financial statements. The company will also gain access to Microsoft’s Azure cloud platform, to create and operate business software apps that should help client companies curb costs and boost efficiencies.
Carande envisions big possibilities for KPMG’s new $2 billion AI investment.
“AI can help analyze historical data, identify patterns, and detect correlations that may not be apparent to human analysts,” he notes. That said, KPMG isn’t giving up on the human touch – not by a long shot.
“A human with experience, intuition, and insider knowledge is still essential for picking out hard-to-detect anomalies,” Carande added. “But generative AI provides a huge head start.”
Brian O’Connell, a former Wall Street bond trader and best-selling author, is a prominent figure in the finance industry. With a substantial background as an ex-Wall Street trader, he has authored two best-selling books: ‘The 401k Millionaire’ and ‘CNBC’s Creating Wealth’, demonstrating his profound knowledge of finance and investing.
Brian is also a finance and business writer for esteemed national platforms and publications, including CNN, TheStreet.com, CBS News, The Wall Street Journal, U.S. News & World Report, Forbes, and Fox News.