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AI: Reality Check

Cost, value and risk controls decide which AI projects survive.

40%+

of agentic AI projects will be canceled by the end of 2027

Gartner prediction

In a June 25, 2025 press release, Gartner predicted that over 40% of agentic AI projects will be canceled by the end of 2027. It named three causes: escalating costs, unclear business value and inadequate risk controls.

Agentic AI means software that can plan and carry out multi-step tasks on its own. The technology is moving fast, and the gap between a promising pilot and a system that pays for itself is where projects stall.

Reason

Escalating costs

Production costs far exceed the pilot budget.

What helps

Prioritize use cases by ROI, risk and feasibility before building, and phase the spend in a roadmap so each step has to earn the next one.

See Strategy & Assessment

Reason

Unclear business value

Returns aren't tied to a measurable business outcome.

What helps

Give every initiative a milestone, an owner and KPIs from the start, so "is it working?" has a number for an answer.

See the AI Roadmap

Reason

Inadequate risk controls

Security and governance arrive too late.

What helps

Put governance, risk controls and ethical guardrails in place from day one, so AI stays transparent and compliant as it scales.

See Responsible AI

Agent washing

Only about 130 of thousands of agentic AI vendors are genuine

Gartner also called out "agent washing": vendors relabeling existing AI assistants, robotic process automation (RPA) and chatbots as agentic without substantial agentic capabilities. Of the thousands of vendors marketing agentic AI, Gartner estimates only about 130 are genuine.

“Many use cases positioned as agentic today don't require agentic implementations.”Anushree Verma, Senior Director Analyst, Gartner

The practical lesson is to start from the business problem. Some problems need an agent. Many are better served by simpler automation, a well-built workflow or an RPA bot.

Where companies are

Most investment is still cautious

How organizations describe their agentic AI investment

Conservative investments42%
Wait and watch, or unsure31%
Significant investments19%
No investments8%

Gartner poll of 3,412 webinar attendees, January 2025. Bars show share of respondents.

Outlook to 2028

Cancellations and rapid adoption at the same time

The same Gartner release is bullish on where agentic AI ends up. The projects that survive are the ones that handle cost, value and risk.

15%of day-to-day work decisions made autonomously by agentic AI by 2028, up from 0% in 2024.
33%of enterprise software applications including agentic AI by 2028, up from less than 1% in 2024.

Before you fund AI

Six questions to ask first

  • What business outcome will this project change, and how will we measure it?
  • Does the use case need an agent, or would simpler automation do the job?
  • What will it cost in production, not just in the pilot?
  • Is our data ready for it?
  • Who owns the result, and who owns the risk?
  • What governance and security controls are in place before launch, not after?

Talk through these with our AI consultancy

Sources

Where these numbers come from

  1. Gartner Predicts Over 40% of Agentic AI Projects Will Be Canceled by End of 2027, Gartner press release, June 25, 2025.
  2. Over 40 percent of Agentic AI projects could face the axe by end of 2027: Gartner, W.Media. Used for the poll figures and the 2028 predictions.
  3. Gartner says agent washing is taking place, Staffing Industry Analysts. Used for the agent washing figures and the analyst quote.

Make your AI project one that survives.

Start with strategy, a roadmap and governance.

Talk to AcuteAI