Global Spending on Generative AI Smartphones to Hit Nearly $300 Billion This Year
NPUs push assistants and multimodal features onto the handset, cutting latency and improving privacy as upgrades accelerate
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Global end-user spending on generative-AI smartphones will reach $298.2 billion by the end of 2025 and account for one-fifth of all AI end-user spending this year, research firm Gartner said this week.
This momentum is expected to continue as more vendors ship devices with on-device models and AI features. the firm said, while projecting a 32% jump in GenAI-phone spending to $393.3 billion in 2026 and adding that premium devices with GenAI capabilities will become universal by 2029.
Gartner defines a GenAI smartphone as one equipped with a built-in neural engine or neural processing unit (NPU) capable of running small language models locally.
Its forecast spans both premium phones and “basic” models priced under $350, while excluding utility phones that lack NPUs.
Hardware is central to the shift. “The broad use of new NPUs in smartphones will allow GenAI models to run faster and more efficiently, requiring users to upgrade to the latest smartphone hardware for optimized experiences,” said Ranjit Atwal, senior director analyst at Gartner. “In 2025, Gartner forecasts almost all premium GenAI smartphones will include NPUs and 41% of basic GenAI smartphones will have NPUs.”
Performance targets are rising as well. By 2027, NPUs delivering more than 40 trillion operations per second are expected to be standard in premium GenAI phones which is enough headroom, Gartner said, to run complex multimodal AI workloads on-device without leaning heavily on the cloud.
The firm said interaction models will evolve alongside the silicon. “Currently, most users still rely on text or touch for all tasks, and voice interactions remain limited in scope. However, as conversational AI becomes more natural in the future, users are expected to become more comfortable with AI as a proactive digital companion, rather than just a reactive tool,” Atwal said.
Taken together, the forecast points to a rapid mainstreaming of on-device AI. The spending ramp in 2025 and 2026, the near-total NPU adoption at the top end next year, and the 40-TOPS baseline for premium phones by 2027 all suggest that GenAI features such as image creation and editing, better on-device assistants, translation and summarization, and context-aware suggestions will increasingly run locally, with privacy and latency benefits over cloud-only approaches.
Gartner’s latest device outlook also implies a broader hardware refresh cycle as consumers and enterprises look for tangible gains from AI at the edge. The firm’s recent commentary on AI devices has warned that differentiation will be tricky once AI becomes a baseline feature, but the near-term draw is clear: faster, more capable NPUs paired with software that moves beyond simple prompts toward conversational, multimodal assistance on the handset itself.
