The Shifting Global Technology Landscape
The global technology landscape is undergoing rapid transformations due to rapid innovation, altering business operations, industry competition, and digital interactions. The demand for computing power is driving experimentation and global competition. The McKinsey Technology Trends Outlook 2025 provides insights to help executives navigate the challenges of scaling emerging solutions and building trust in a world where digital and physical boundaries blur. Leaders must understand which frontier technologies are most relevant to their companies and draw insights from how others are implementing them today.
A Baker’s Dozen Frontier Technologies for 2025
The McKinsey Technology Trends Outlook is a comprehensive analysis of 13 frontier technology trends that have the potential to reshape global business by 2025. The report uses quantitative measures such as interest level, innovation pace, equity investment volume, and talent availability to provide a framework for understanding the underlying technologies, uncertainties, and critical questions business leaders must address. The research methodology allows for a nuanced understanding of each trend’s maturity, potential impact, and suitable strategic approaches for companies. The report aims to equip leaders with the knowledge to make informed decisions about their technological investments and strategic efforts.
AI as the Foundational Amplifier and Its Evolution
Artificial intelligence (AI) is a powerful technology wave that accelerates progress in various fields, such as robot training and bioengineering, while unlocking new possibilities at the intersection of various technologies. The market evolution of AI solutions has led to a shift in how it is viewed and applied, with applied AI and generative AI now combined. Realising AI’s full potential requires continued innovations to manage computing intensity, reduce deployment costs, and drive infrastructure investment. This requires safety, robust governance frameworks, and proactive workforce adaptation.
New and Notable Trends Agentic AI and Application-Specific Semiconductors
The 2025 outlook highlights two significant trends in AI: agentic AI and application-specific semiconductors. Agentic AI combines AI foundation models with the ability to act autonomously in the real world, creating “virtual coworkers” capable of planning and executing multistep workflows. Although interest and equity investment levels are relatively low, its rapid growth indicates its potential for revolution across various sectors. Application-specific semiconductors, a key development, have seen a surge in innovation due to the increased demands for computing capacity, memory, and networking for AI training and inference, as well as the need to manage cost, heat, and electric power consumption.
Cross-Cutting Themes Shaping the Future of Technology
This year’s technology trends highlight a future where technology is more adaptive, collaborative, and integral to solving global problems. Autonomous systems are shifting from pilot projects to practical applications, with physical robots and digital agents learning, adapting, and collaborating in diverse environments. New human-machine collaboration models are emerging, characterised by natural interfaces, multimodal inputs, and adaptive intelligence.
Scaling challenges are becoming more prominent, with global infrastructure straining due to compute-intensive workloads from AI, robotics, and immersive environments. Regional and national competition over critical technologies has intensified, with countries and corporations investing in infrastructure and localised initiatives. Scale and specialisation are growing simultaneously, with innovations in cloud services and advanced connectivity. Responsible innovation is paramount, demanding transparency, fairness, and accountability in AI models, gene editing, and immersive platforms.
Investment Climate and Strategic Imperatives
In 2023, the macroeconomic environment and market weakness led to declines in equity financing for several technology trends. However, the investment climate for frontier technologies stabilised and rebounded in 2024. Key trends like cloud and edge computing, bioengineering, and space technologies saw increased equity investment. AI and robotics investments experienced a temporary dip but recovered to higher levels in 2024.
The future of energy and sustainability technologies and mobility saw declines in 2023, but the former showed a strong bounce back. Executives must identify high-impact domains where these trends can be effectively applied, make targeted investments in talent and infrastructure, and address external factors like evolving regulatory shifts and ecosystem readiness.
Navigating the Future Driving Transformation with Foresight
McKinsey’s “baker’s dozen” of technology trends in 2025 highlights the potential of emerging technologies and the need for strategic alignment in an AI-powered future. Executives must identify and prioritise high-impact domains within their organisations where these transformative trends can be most effectively applied, requiring a deep understanding of the technologies and foresight into their potential to create new value and competitive advantages.
Sustaining investment in talent and robust infrastructure is crucial for successful implementation and scaling of these innovations. Proactively addressing external factors, such as regulatory shifts and ecosystem readiness, is also essential. Leaders can accelerate the adoption of frontier technologies by fostering collaboration, bridging gaps, and maintaining a clear vision. A focused approach and agility will unlock new value streams and shape the future trajectory of industries and emerging frontier technologies.
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