AI Funding Booms Globally in Q2 2025, Led by US and UAE
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
Global investment in artificial intelligence (AI) companies surged in the second quarter of 2025, with startups in the United States and United Arab Emirates (UAE) leading a wave of capital inflows that continues to reshape the tech and finance sectors.
According to new data from PitchBook, global AI funding reached $48.7 billion in Q2 — a 36% increase from the previous quarter and the highest level since late 2023. The U.S. accounted for more than half of all deal value, while the UAE saw a dramatic rise in AI venture deals, driven by sovereign wealth fund support and strategic partnerships.
The top three deals included CortexOne, a California-based AGI research firm, which raised $5.2 billion in a Series D round led by BlackRock and Sequoia Capital. Meanwhile, SaharaTech AI, headquartered in Abu Dhabi, secured $3.1 billion from Mubadala, SoftBank, and several Gulf-based investors. The third-largest deal involved NeuralGrid, a U.K.-based energy AI platform that raised $1.8 billion to expand into smart grid optimization.
“AI has moved beyond hype into strategic infrastructure,” said Dana Quinn, managing partner at VisionStreet Ventures. “Governments and institutional investors now see it as a national priority and an engine of economic transformation.”
Startups focused on enterprise automation, generative AI models, and autonomous robotics attracted the most capital. Notably, funding to AI in healthcare surged 52% from Q1, as demand for diagnostic algorithms and clinical workflow automation continued to rise across Europe and Asia.
The UAE’s emergence as a top-tier AI hub marks a significant shift. Supported by its pro-tech regulatory environment and massive investment arms like ADQ and Mubadala, the country is positioning itself as the “AI capital of the Global South.”
“We are building an ecosystem that fuses talent, compute infrastructure, and policy clarity,” said Dr. Saif Al Mazrouei, Director of UAE’s AI Office. “The goal is not just to consume AI but to export it.”
Despite the enthusiasm, some analysts warned of signs of froth. Valuations of pre-revenue AI firms are reaching historic highs, and concerns over regulation — especially in data privacy and algorithmic accountability — are growing.
Still, capital continues to flow as institutional players shift long-term portfolios toward tech-driven innovation. The AI race is increasingly seen as a geopolitical and economic battleground, and investors are betting big on its future impact.
As one VC put it: “In 2025, AI isn’t a sector — it’s the foundation of everything.”
