Gulf firms face widening AI returns gap

Gulf businesses are investing heavily in artificial intelligence (AI), but many are struggling to see substantial financial returns from their efforts. A survey reveals that while 84% of Gulf organisations utilise AI, only 11% have achieved a level of deployment that generates measurable value. This gap is prompting executives to demand evidence that AI can enhance revenue, margins, productivity, or customer outcomes.

The issue is becoming more pressing as investments soar; 85% of Gulf organisations expect their AI budgets to rise in 2026, with nearly 40% anticipating significant increases. Generative AI is currently the top priority for 35% of surveyed organisations. However, a key obstacle is the lack of comprehensive data foundations, with only 16% of Gulf CEOs reporting that their AI tools can access all relevant corporate information.

This restricts AI's ability to generate accurate insights and automate complex processes. Furthermore, the shift from simple AI applications, such as email drafting and customer-service assistance, to more advanced systems capable of multi-stage tasks is exacerbating the problem. This shift requires reliable information and clear accountability, which many organisations currently lack.

Governance is also emerging as a critical factor in determining AI's success. Only 13% of UAE organisations have comprehensive AI governance frameworks, while half of executives report difficulty managing the complexity introduced by an increasing number of AI assets. Despite these challenges, some companies are already seeing positive results when AI initiatives are closely aligned with business objectives.

For instance, a survey of Saudi Arabian technology decision-makers found that 91% believed their AI projects were meeting or exceeding expectations, with half reporting performance above expectations. Financial services have also demonstrated that AI can improve commercial performance when properly integrated, with research showing links between AI adoption, profitability, and market valuation.

Middle Eastern CEOs are demonstrating greater agility than many global counterparts, with 43% reporting extensive AI use in sales, marketing, and customer service, compared to just 22% globally. The focus is now shifting from the number of AI projects launched to the effectiveness of those projects in generating business value. To succeed, organisations must narrow their portfolios, define measurable outcomes before deployment, improve interoperability between systems, and treat high-quality enterprise data as critical infrastructure rather than an afterthought.