Photo Credits – Sensor Tower

There has been an exponential increase in interest in artificial intelligence (AI) in recent years, both from tech consumers as well as developers who have begun to follow the trend and factor AI into their applications to meet the increasing demand. This has seen a significant increase in the number of AI-powered applications.

The Rise of AI-Powered Apps

The growth in the AI industry has led to an increase in the release of many AI-powered productivity apps both on the Google Play and App Store platforms resulting in a subsequent increase in the number of apps with the term ‘AI’ in their names as shown in an apps report by Sensor Tower.

According to the report, “Within the Product category, the number of apps with names that include the term “AI” has seen substantial growth, rising from only 3 in 2020 to 34 in the first quarter of 2023.”

As such, the first three months of this year have seen downloads and sales of these AI-powered apps from the Play Store and App Store significantly increase. Installs, for instance, increased to 45.8M, a 378 percent increase from Q4 of 2022 to Q1 of this year.

Additionally, the revenue earned increased dramatically by 396% from the previous quarter, reaching an astonishing $20 million in Q1.

While the increase in interest in AI productivity apps was experienced worldwide, the United States topped the charts for the highest adoption rate. With close to 10M downloads in Q1 2023 which is a 550 percent increase from the previous quarter, downloads by U.S. residents hold more than one-fifth of the global market share.

Photo Credits – Sensor Tower

As a result of the high adoption rate, it is natural that AI-powered applications also performed well in the US in terms of income. In Q1 of this year, the top apps powered by AI in the U.S. produced $8.3M in revenue equating to 41% of the world’s market.

With a share of only 5%, the United Kingdom came in a distant second with $958K, whereas China and Japan took third and fourth positions with $882K (4%) and $836K (4%) respectively. Regarding downloads, India took second place making up 6% of global downloads, followed by Brazil, which accounted for 5%.

Fierce Competition in AI Apps Ahead

The report also provided insights on the top AI-powered productivity apps on both Android and iOS in terms of downloads as well as revenue in the first quarter of this year.

Based on Sensor Tower’s analysis, the “AI Chatbot” app developed by Vulcan Labs gathered 9.5 million downloads and generated $3.3 million in gross revenue thus topping the charts in both categories.

With 7.3 million new installations, the Bing app, released in February by Microsoft, took second place with 7.3 million downloads. Genie followed the two apps – AI Chatbot by AppNation, AI Chat – Chatbot AI Assistant by Social Media Apps, and ELSA’s ELSA: AI Learn which took third, fourth, and fifth place respectively.

About a week ago, OpenAI released a ChatGPT app on the App Store and while that is a cause for celebration for consumers, the app market is going to get even more competitive as the release of the Android version of the AI chatbot looms.

“Now, with the release of the official OpenAI ChatGPT app on the App Store, competition is going to get fierce in this area, with new entrants needing to compete with much larger, well-funded publishers with a significant stake in their success,” Sensor Tower said.

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