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Redding, California - April 25, 2024

Natural Language Processing (NLP) Market to be Worth $164.9 Billion by 2031

Natural Language Processing Market by Component, Organization Size, Application, Sector (IT & Telecommunications, BFSI, Retail & E-commerce, and Healthcare & Life Sciences) - Global Forecast to 2030

Meticulous Research^®—a leading global market research company, published a research report titled, ‘Natural Language Processing Market by Offering (Solutions, Services), Organization Size, Application (Sentiment Analysis, Chatbots & Virtual Assistant, Others), Sector (IT & Telecom, BFSI, Retail & E-commerce, Others), Geography - Global Forecasts to 2031’

According to this latest publication from Meticulous Research^®, the natural language processing market is projected to reach $164.9 billion by 2031, at a CAGR of 29.2% from 2024 to 2031. The growth of the market is driven by factors such as the rising adoption of smart devices, the growing demand for NLP-based applications for customer support, and the rising demand for NLP tools in call centers. Moreover, the rapid adoption of cloud-based technologies and increasing applications of NLP in the healthcare sector are expected to offer market growth opportunities.

However, the limitations in the development of NLP technology restrain the market's growth. Additionally, data privacy & security concerns pose challenges to the market’s growth.

The adoption of virtual assistants & chatbots and the growing demand for speech analytics solutions are the key trends observed in the natural language processing market.

The natural language processing market is segmented by offering, organization size, application, and sector. The study also evaluates industry competitors and analyzes the regional and country-level markets.

Based on offering, the natural language processing market is broadly segmented into solutions and services. In 2024, the solutions segment is expected to account for the larger share of 74.0% of the global natural language processing market. The large market share of this segment is attributed to the rising adoption of NLP among enterprises to analyze data and discover insights, automate time-consuming processes, and help them gain a competitive advantage.

However, the solutions segment is projected to register the higher CAGR during the forecast period. The rising focus of market players on product development and enhancement is expected to drive the growth of this segment. For instance, in December 2022, Kaleyra, Inc. (U.S.) launched a new lineup of chatbots for WhatsApp Business that will allow businesses to create advanced conversational experiences on the platform. With a daily volume of over 100 billion messages, WhatsApp provides a convenient and efficient way for businesses to connect with their customers in real time.

Based on organization size, the natural language processing market is segmented into large enterprises and small & medium-sized enterprises. In 2024, the large enterprises segment is expected to account for the larger share of 62.0% of the global natural language processing market. The large market share of this segment is attributed to factors such as the strategic IT initiatives developed by large enterprises, the increasing demand for managing large volumes of customer-level data, the early adoption of advanced technologies across retail, manufacturing, healthcare, and automotive sectors, and the rising need for improved insights into customer responses.

However, the small & medium-sized enterprises segment is expected to register the higher CAGR during the forecast period. The growth of this segment is driven by the increasing need for contact center analytics solutions among small organizations, notable benefits offered by NLP solutions for small & medium-sized enterprises, and the growing adoption of cloud-based NLP solutions & services among these enterprises.

Based on application, the natural language processing market is broadly segmented into sentiment analysis, chatbots & virtual assistants, machine translation, text summarization, market intelligence, speech recognition, and other applications. In 2024, the speech recognition segment is expected to account for the largest share of 40.0% of the global natural language processing market. The segment’s large market share can be attributed to the rising use of NLP for improving the accuracy, robustness, and features of speech recognition systems.

However, the chatbots & virtual assistants segment is expected to register the highest CAGR during the forecast period. The increasing need to capture valuable customer data and insights, provide brands with actionable feedback to optimize their products, services, and marketing strategies, and deliver personalized recommendations, content, and offers tailored to individual preferences and behavior are expected to drive growth in this segment.

Based on sector, the natural language processing market is broadly segmented into IT & telecommunications, BFSI, retail & e-commerce, healthcare & life sciences, transportation & logistics, government & public sector, media & entertainment, manufacturing, education, food & beverages, and other sectors. In 2024, the IT & telecommunications segment is expected to account for the largest share of 23.0% of the global natural language processing market. The segment's large market share can be attributed to the rising adoption of speech analytics and sentiment analysis solutions in IT & telecom call centers to analyze business conversations, the increasing need to gather actionable information, and the increasing demand for NLP-based network solutions in the telecommunications sector.

However, the healthcare & life sciences segment is expected to register the highest CAGR during the forecast period. The growth of this segment is driven by the rising applications of NLP in healthcare, including areas such as clinical trial matching and clinical documentation, the widespread adoption of AI chatbots and virtual scribes, and initiatives by governments and companies to deploy chatbot solutions for providing healthcare data.

Based on geography, the natural language processing market is segmented into North America, Asia-Pacific, Europe, Latin America, and the Middle East & Africa. In 2024, North America is expected to account for the largest share of 35.0% of the natural language processing market. North America’s significant market share can be attributed to the growing adoption of digital assistants and chatbots in the BFSI, retail, and IT & telecommunications sectors, the rising demand for cloud-based NLP solutions & services, the presence of well-established NLP solution providers, and the growing demand for speech analytics solutions.

However, the market in Asia-Pacific is projected to register the highest CAGR of 31.0% during the forecast period. The growth of this regional market is driven by government initiatives aimed at increasing the adoption of digital assistants, chatbots, sentiment analytics solutions, OCR solutions, and IVR systems, along with market players' efforts to launch NLP solutions such as chatbots and emotional intelligence solutions. Furthermore, the growing popularity of cloud-based NLP solutions and NLP-based applications across the region contributes to the growth of this market. For instance, in May 2021, Pluszero Inc. (Japan) launched "Nekonote," a data creation service to improve its accuracy in Japanese natural language processing. Additionally, in February 2021, ITOCHU Techno-Solutions Corporation (Japan) launched SmartBERT, an AI natural language processing engine, utilizing the deep learning technology of Intumit Inc. (Taiwan).

Key Players:

The key players operating in the natural language processing market are Google LLC (U.S.), Microsoft Corporation (U.S.), Amazon Web Services, Inc. (a subsidiary of Amazon.com, Inc.) (U.S.), Oracle Corporation (U.S.), IBM Corporation (U.S.), NVIDIA Corporation (U.S.), QUALCOMM Incorporated (U.S.), Baidu, Inc. (China), Verint Systems Inc. (U.S.), SAP SE (Germany), Intel Corporation (U.S.), Adobe Inc. (U.S.), Genpact Limited (U.S.), SAS Institute Inc. (U.S.), and NetBase Solutions, Inc. (U.S.).

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Key questions answered in the report-

Which are the high-growth market segments based on offering, organization size, application, and sector?
What was the historical market for natural language processing?
What are the market forecasts and estimates for the period 2024–2031?
What are the major drivers, restraints, and opportunities in the natural language processing market?
Who are the major players, and what shares do they hold in the natural language processing market?
How is the competitive landscape in the natural language processing market?
What are the recent developments in the natural language processing market?
What are the different strategies adopted by the major players in the natural language processing market?
What are the key geographic trends, and which are the high-growth countries?
Who are the local emerging players in the global natural language processing market, and how do they compete with the other players?

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Redding, California - April 25, 2024

Natural Language Processing (NLP) Market to be Worth $164.9 Billion by 2031

Natural Language Processing Market by Component, Organization Size, Application, Sector (IT & Telecommunications, BFSI, Retail & E-commerce, and Healthcare & Life Sciences) - Global Forecast to 2030

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