While businesses globally are rushing to adopt AI, Gartner’s latest report suggests that more than 40 percent of Agentic AI projects could be cancelled in the coming years due to high operational costs, security concerns, and unclear business value. The report states that although AI adoption will continue to rise rapidly, many companies will abandon their in-house Agentic AI initiatives for practical reasons.

Gartner’s recent survey of 3.412 agentic AI vendors reveals that 19 percent of organizations have made significant investments in agentic AI, 42 percent made conservative investments, 8 percent had made no investments, and 31 percent were on the fence.  The report says that out of the thousands of agentic AI vendors it surveyed, only around 130 held any substance.

Most vendors, the report says, are contributing to the hype by engaging in “agent washing”. The vendors only indulge in rebranding of existing products, such as AI assistants, robotic process automation (RPA) and chatbots, without substantial agentic capabilities.

Anushree Verma, Senior Director Analyst, Gartner, says, “Most agentic AI projects right now are early stage experiments or proof of concepts that are mostly driven by hype and are often misapplied. This can blind organizations to the real cost and complexity of deploying AI agents at scale, stalling projects from moving into production. They need to cut through the hype to make careful, strategic decisions about where and how they apply this emerging technology.”

Even though Gartner feels that several agentic AI projects will be cancelled, it says that AI will still transform business operations in the future. It predicts at least 15 percent of day-to-day work decisions will be made autonomously through agentic AI by 2028, up from 0 percent in 2024. In addition, 33 percent of enterprise software applications will include agentic AI by 2028, up from less than 1 percent in 2024.