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UAE AI spending doubles but execution gap threatens maturity gains
UAE organisations increased AI spending by 105% year on year, but a new ServiceNow report found weak governance, siloed data and limited automation are slowing enterprise-wide adoption
- PUBLISHED: Tue 18 Aug 2026, 4:00 PM
UAE organisations are rapidly increasing investment in artificial intelligence, but many are struggling to turn that spending into large-scale business transformation, according to new research from ServiceNow.
The company’s UAE findings from the Enterprise AI Maturity Index 2026 show AI spending among organisations in the country rose 105% year on year. However, enterprises achieved an AI maturity score of just 48 out of 100, despite improving by 13 points from the previous year. The report argues that the gap between investment and execution is emerging as a key challenge as companies move beyond the experimentation phase.
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According to the study, the issue is not a lack of commitment to AI. UAE organisations expect artificial intelligence to account for nearly one-fifth of total IT budgets by 2027. Instead, many businesses are attempting to deploy AI across fragmented technology environments, disconnected data systems and siloed workflows, limiting their ability to scale adoption across the enterprise.
The findings come as agentic AI gains attention across the region. While 57% of UAE organisations have already implemented agentic AI, only 7% have used it to create autonomous workflows, suggesting most deployments remain focused on improving employee productivity rather than fundamentally changing business operations.
“The UAE remains one of the world’s most ambitious AI markets. The government’s long-term strategy and regulatory leadership have given organisations a genuine head start,” said Saif Mashat, vice president for the Middle East and Africa at ServiceNow. “While UAE 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,” he said.
The report identifies legacy technology as one of the biggest obstacles. Only 14% of UAE organisations have replaced older systems with integrated platforms, leaving many AI initiatives operating across disconnected workflows rather than a unified technology backbone.
Data quality is another major concern. More than three-quarters, or 77%, of UAE executives surveyed said inadequate data accuracy, access and management remain significant barriers to AI adoption. The report said improving data integration and management will be essential if businesses are to scale AI effectively.
The research also found a sharp divide between organisations with high levels of AI maturity and their peers. Companies that combine technology investment with workforce upskilling, AI governance, data modernisation and autonomous workflows are achieving substantially stronger outcomes. These organisations generate an average return on investment of 160%, which is projected to rise to 194% within two years. They are also 5.6 times more productive, 2.7 times more successful at scaling AI and 2.6 times more effective at managing risk.
However, governance remains a weak spot across the UAE market. Only 16% of organisations have implemented AI testing, auditing and risk-management processes, according to the report.
“The organisations pulling ahead are no longer distinguished by how much they spend on AI, but by how effectively they operationalise it,” Mashat said. “Strong governance, connected data and orchestrated workflows are what translate investment into business outcomes.”
The study, conducted by ThoughtLab on behalf of ServiceNow, surveyed 4,500 executives and 2,000 employees across 19 countries and 12 industries, including 100 executives in the UAE.
