Organizations across the Middle East are rapidly moving beyond artificial intelligence (AI) experimentation and into large-scale deployment, according to Deloitte’s 2026 State of AI in the Enterprise report.
The report, based on insights from more than 3,200 business and IT leaders across 24 countries, found that AI adoption in the region is entering a new phase focused on operational integration, scalability and long-term business value.
According to the findings, access to enterprise AI tools expanded by 50 percent over the past year, with sanctioned AI access increasing from less than 40 percent of employees to nearly 60 percent. More than half (54 percent) of organizations expect at least 40 percent of their AI experiments to move into production environments within the next three to six months.
“Across the Middle East, organizations are moving decisively from AI curiosity into enterprise-wide activation,” said Aditi Nitin, AI & Data Leader at Deloitte Middle East. “What we are now seeing is a shift from isolated pilots toward embedding AI into the core fabric of business operations, decision-making, and customer experience. The organizations that will lead the next phase of AI adoption will not necessarily be those experimenting the fastest, but those building the right foundations around governance, talent, trust, and scalable infrastructure.”
The report found that while AI is delivering productivity benefits, many organizations have yet to use the technology to drive deeper transformation. About 66 percent of respondents reported improved efficiency and productivity through AI, but only 20 percent said AI initiatives are currently contributing to revenue growth. However, 74 percent expect AI to drive revenue growth in the future.
Only 34 percent of organizations said they are using AI to significantly transform products, processes or business models, while 37 percent remain focused on productivity improvements without major operational changes.
Deloitte noted that many organizations remain caught in a “proof-of-concept cycle”, launching AI pilots without successfully scaling them because of integration, governance and infrastructure challenges.
Workforce readiness emerged as another major concern. The report found that 84 percent of organizations have not yet redesigned jobs or workflows to incorporate AI capabilities, despite increasing expectations around automation.
“AI transformation is ultimately a human transformation,” added Aditi Nitin. “Technology alone will not create competitive advantage. Organizations must rethink how work gets done, how teams are structured, and how employees collaborate with increasingly intelligent systems. The future belongs to organizations that combine human judgment, creativity, and leadership with AI-enabled scale and speed.”
The report also highlighted the growing importance of sovereign AI, with 77 percent of organizations saying the location where AI technologies are developed is an important factor when choosing vendors and platforms. The trend reflects increasing concerns around data sovereignty, infrastructure dependence and geopolitical risks.
Advanced AI technologies are also gaining momentum. While only 23 percent of organizations currently use agentic AI to a moderate extent or more, Deloitte expects adoption to increase significantly over the next two years, with nearly three-quarters of organizations projected to deploy the technology at scale.
However, only 21 percent of organizations reported having mature governance frameworks for autonomous AI systems, raising concerns about oversight and accountability.
Data privacy and security remain the top AI-related concern globally, cited by 73 percent of respondents. Other concerns include regulatory compliance, governance oversight and model reliability.
The report also pointed to rising adoption of physical AI technologies such as robotics and autonomous systems. Globally, 58 percent of organizations currently use physical AI, a figure expected to increase to 80 percent within two years.
Despite growing confidence in AI’s long-term value, many organizations acknowledged gaps in preparedness, particularly in infrastructure, data management and workforce skills.
Deloitte said the next stage of AI success in the Middle East will depend on organizations’ ability to scale AI responsibly, redesign workflows, modernize infrastructure and strengthen governance frameworks for increasingly autonomous systems.
