The year 2025 could prove decisive for artificial intelligence. With spending on AI data centers expected to exceed $1.4 trillion by 2027, the industry faces increasing pressure to deliver on its promises. Modelers boast that artificial general intelligence will change every aspect of our society and economy, starting this year. But much uncertainty remains. Some researchers have warned that the rapid progress of recent years could slow; Most companies adopting AI continue to struggle to achieve ROI. Meanwhile, infrastructure and energy bottlenecks threaten to spoil further progress.
But we must not lose sight of the bigger picture. Even with existing capabilities, AI is transforming our world, and we are only beginning to see its profound effects ripple through society. This presents many risks and challenges, but much of this progress holds enormous promise for society as AI works to transform science, accelerate discoveries, and advance human knowledge.
And technological progress is not limited to AI. Progress is being made in many areas: breakthroughs in climate technology, weight-loss drugs that could transform millions of lives, and quantum computing on the verge of practical applications. Here are the key developments to watch in 2025:
Hype around AI is fading, but its impact is growing
The peak of hype around AI has given way to more sober expectations. Businesses struggle to derive significant value from generative AI, while reports end of the year suggest that progress in core capabilities could be plateau. The coming year will be crucial for major modelers, as it will have to determine whether a trillion dollar bet is profitable, because they are looking for a way to generate profit with a multitude of “agents” who automate tasks. Time will tell if the benefits will justify the expense for many.
But the broader impact of AI is undeniable. Over the past year, AI Wizzery has helped preserve indigenous languages, restoring an ALS patient’s voice And reconstruct the epic of Gilgameshone of humanity’s oldest texts, bringing an “extreme acceleration” to ancient scholarship. Several drugs designed with AI are expected to enter phase three trials this year. AI is also enabling breakthroughs in protein design, climate modeling and brain research. predict clinical outcomes and future brain states simply from analyses. Whatever its future capabilities, the potential of current AI models has barely been explored.
In 2025, watch how AI begins to change science and innovation itself. Researchers hope that AI can be used to automate much of the scientific process: generating hypotheses, designing experiments and writing papers. If this comes to pass, it could create a cycle of accelerated innovation. Indicators to watch include the rise of AI-based startups in areas such as protein design and prediction, as well as the creation of new benchmarks for AI in science, which will be essential for build trust and evaluate progress.
The accelerationist program
Donald Trump’s return to the White House could mean easing regulations on AI to spur innovation and competition between America and China. In some ways, this can be a good thing for innovation. But such measures are likely to raise concern among those interested in AI security (which could include Mr. Trump’s wingman Elon Musk, who has both supported the security measures and invested heavily in AI). Expect more talk about “defensive acceleration,” the idea that sometimes the best way to mitigate technology risks is to build better technology, to address challenges ranging from AI and cybersecurity to nuclear threats.
Next year’s AI Action Summit, following those in Bletchley Park and Seoul, will reflect evolving technology governance priorities on the global stage. The summit will drop the term “security” from its title, signaling a shift toward practical risk management and harnessing AI for public benefit in areas including education, health, security and sustainability environmental. Expect less focus on speculative fears and wild statements about aligning governance frameworks, and more emphasis on achieving tangible results.
A review of the hidden costs of AI
The coming year will bring more attention to the physical demands of artificial intelligence. Generative AI is putting a strain on energy grids, with data centers consuming up to 30% of network capacity in some regions of the United States. To meet demand, Microsoft will buy back all the electricity from the revived Three Mile Island nuclear power plant. Others are exploring small modular reactors to power new facilities, although nuclear power development is slow and controversial. AI power consumption helps keep coal plants running, as seen in Omaha, where a power plant serving Google and Meta abandoned its plan to phase out coal. Data centers also consume large amounts of water for cooling.
Assessing these impacts is difficult due to the lack of transparency, although this may soon change. The European Union will require data centers to disclose their energy and water consumption, a move that could clarify their environmental costs and spark debates about tradeoffs. Can better laws reduce emissions? How will utilities, technology companies and regulators manage resource constraints? These questions will become pressing as AI develops.
The defining moment of deep tech
While AI dominates the headlines, other technological frontiers are advancing rapidly and deserve attention.
In 2025, we will continue to see a shift in focus when it comes to investment in innovation. The era of rapidly evolving digital platforms and consumer applications is giving way to a more fundamental focus on harnessing and scaling scientific and engineering advances in pioneering areas such as synthetic biology, materials and quantum computing, to address humanity’s most pressing challenges. These technologies require greater initial investment and longer development cycles, but promise a more transformative impact. The doubling of deep tech’s share of global venture capital and private equity funding from 10% to 20% over the past decade is a testament to this strategic pivot.
The confluence of pressing global challenges, mature technologies, and growing institutional support suggests that we are entering what could be deep technology’s watershed moment. Governments are also seeking to strengthen their high-tech ecosystems in efforts that combine the vogue for industrial policy and security policy in a more uncertain world, fear of over-reliance on technology foreign and sustainability. Success will require new models of collaboration between research institutions, businesses and governments, going beyond the traditional venture capital model to build sustainable innovation ecosystems capable of nurturing long-term technological breakthroughs.
The reality of synthetic biology
The synthetic biology sector, in which microbes are modified to create products ranging from drugs to materials, is undergoing an AI-like reality check. The three largest companies in the sector have stumbled in 2024, with bankruptcies, liquidations and layoffs. Investors, frustrated by broken promises, have pushed companies to abandon their grand visions and turn to narrower, practical applications.
The future of the industry lies in specialization and practical applications rather than moonshot promises. This shift is particularly evident in the pharmaceutical sector, where biologic therapies now account for a quarter of new drugs approved in the United States and generate nearly half of global pharmaceutical revenues. Meanwhile, groundbreaking research continues to highlight the transformative potential of this field. Researchers at Penn State University have engineered bacteria to detect TNT in soil, a development that portends powerful environmental monitoring capabilities. For 2025, synthetic biology can be expected to follow a “less hype, more substance” trajectory similar to that of AI.
GLP-1 drugs: a health revolution in progress
Another revolutionary area to watch is GLP-1 weight loss drugs, which could transform society and reshape industries as their adoption spreads and new benefits emerge.
Semaglutide, the active ingredient in drugs like Ozempic, will become generic in 2025 in key markets such as Canada, India and China, expanding global access. Clinical trials investigating long-term effects, such as muscle loss, will be essential as these drugs move from medical to lifestyle use.
Current users of GLP-1 drugs already consume 8% less food on average, a trend that has far-reaching implications for healthcare, food industries and consumer behavior. And these drugs are proving effective not only in combating obesity, but also in cardiovascular and kidney disease, and are currently being tested for their power to combat Alzheimer’s disease and combat addiction.
A turning point in climate technology
The International Energy Agency estimates that by 2025, combined solar-photovoltaic generation and battery storage will become cheaper than coal-fired electricity in China and new gas-fired power plants in America. This will mark a crucial turning point for the adoption of clean energy. Meanwhile, hard-to-decarbonize sectors are seeing advances in carbon capture, green hydrogen and grid-scale storage technologies, including sodium-ion batteries and compressed gas.
As the initial hype about AI fades, a broader technological transformation is underway. From AI-driven science to breakthroughs in healthcare and clean energy, 2025 could be the year when speculation gives way to substance and these innovations begin to realize their potential.