The Year of AI in Saudi Arabia: The Progress Made So Far

Article Highlights

• The rise in AI-related business registrations signals growing private-sector confidence, as more companies establish activities linked to AI and emerging technologies.
• International companies are increasingly using Saudi Arabia as a local operating base, rather than treating the Kingdom solely as a market to sell into.
• The growth of AI is also increasing the need for digital resilience and cybersecurity, as businesses adopt more complex cloud and AI environments.
• Saudi Arabia’s AI opportunity extends beyond model development, creating space for companies that provide the infrastructure, software, data, security, and services needed to deploy AI at scale.

Saudi Arabia designated 2026 as the Year of Artificial Intelligence, reaffirming its commitment to accelerating the adoption of cutting-edge technology as a cornerstone of the digital economy and strengthening the Kingdom’s position as a global leader in AI.

Several months into the year, the progress is already visible, from a sharp rise in AI-related commercial registrations to major investments in infrastructure and partnerships with global technology companies.

AI Business Activity Is Growing Across the Kingdom

The expansion of Saudi Arabia’s AI ecosystem is increasingly reflected in the number of new businesses entering the market.

According to the Ministry of Commerce, commercial registrations for artificial intelligence activities reached 24,552 as of September 2026, representing a 31% increase from 2025. This builds on substantial growth over the longer term, with AI-related commercial registrations rising 240% between 2021 and 2025, from 5,762 to 19,600.

The growth is also extending into related technology sectors. Cybersecurity registrations increased 22% to 11,275, while registrations for virtual and augmented reality activities rose 21% to 13,853.

These trends point to an increasingly diverse technology ecosystem, with AI moving beyond a national policy priority to become an area of growing commercial activity and private-sector participation.

Data Centers and Digital Infrastructure Are Becoming National Priorities

As AI adoption accelerates, access to the computing power needed to develop and deploy AI models is becoming increasingly important.

Data centers are evolving from digital storage facilities into critical infrastructure for AI economies, making access to power, land, connectivity, and computing capacity an increasingly important factor in attracting investment.

Globally, Saudi Arabia is already positioning itself to capture this opportunity. The Kingdom was recently ranked second globally, after the US, for data center market attractiveness, with power availability and land readiness accounting for a significant share of its competitiveness.

Moreover, the country now ranks among the world’s top 10 for private AI investment, according to the World Bank’s 2026 World Development Report.

As investment moves from AI models and applications into data centers, cloud infrastructure, cybersecurity, enterprise software, and AI-enabled services, companies across the tech ecosystem have an opportunity to participate in the Kingdom’s next phase of growth.

How Companies Can Capitalize on AI Growth

For global companies, establishing a local presence in Saudi Arabia can be an important step toward capturing opportunities created by the Kingdom’s rapidly expanding AI ecosystem.

Recent Saudi expansions supported by AstroLabs illustrate how companies across different layers of the technology stack are positioning themselves to serve growing demand in the Kingdom.

Napster, an AI company developing embodied, multimodal agents, was incorporated in Saudi Arabia in September, establishing a locally governed entity to support its growing deployments and partnerships in the Kingdom.

The company has also worked with Takamol, DETASAD, and Nourah Information Technology Company to advance sovereign AI capabilities and Arabic-native intelligence for Saudi clients.

As AI and cloud adoption accelerate, they are also expanding organizations’ digital attack surfaces, increasing the need for stronger cybersecurity, network visibility, and resilience. ExtraHop, a network detection and response (NDR) company, has established a presence in Saudi Arabia to serve enterprises and critical infrastructure providers.

Its expansion highlights the growing demand for cybersecurity capabilities as organizations adopt AI and cloud technologies across increasingly complex digital environments.

The bottom line: companies that establish a local presence can position themselves closer to customers, partnerships, and emerging opportunities while gaining an early foothold in one of the world’s fastest-growing AI markets.