Gartner: 40% of Agentic AI Projects in Danger of Collapse by 2027 Amid Hype, Cost, and Risk Concerns

25 June 2025 – More than 40% of agentic AI initiatives are projected to be cancelled by the end of 2027, largely due to rising costs, unclear returns, and weak risk oversight, according to a new forecast from Gartner, Inc.

“Most agentic AI projects right now are early stage experiments or proof of concepts that are mostly driven by hype and are often misapplied,” said Anushree Verma, Senior Director Analyst at Gartner. “This can blind organisations 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.”

Agentic AI refers to systems capable of executing complex tasks autonomously, learning over time, and making decisions aligned with business outcomes — a clear evolution beyond traditional chatbots or automation scripts.

According to a Gartner poll conducted in January 2025 with over 3,400 business leaders, only 19% of organisations have made significant investments in agentic AI. A further 42% reported conservative adoption, while 8% indicated no activity at all. The remainder are either undecided or in observation mode.

“Agent Washing” Clouds the Landscape

The term “agent washing” has emerged to describe how vendors are hastily rebranding legacy automation tools — such as RPA, chatbots or AI assistants — as ‘agentic AI’ without delivering the underlying intelligence or autonomy. Gartner estimates only around 130 vendors globally can truly be considered agentic AI providers.

“Most agentic AI propositions lack significant value or return on investment (ROI), as current models don’t have the maturity and agency to autonomously achieve complex business goals or follow nuanced instructions over time,” Verma added. “Many use cases positioned as agentic today don’t require agentic implementations.”

Business Impact Still Promising — With the Right Focus

Despite the early-stage pitfalls, Gartner sees agentic AI as a pivotal advancement in enterprise automation. The technology has the potential to streamline resource utilisation, enhance decision-making, and unlock new operating models — but only when applied strategically.

Gartner forecasts that by 2028, at least 15% of routine business decisions will be made autonomously via agentic AI, a sharp rise from virtually zero in 2024. Similarly, one-third of enterprise software platforms are expected to embed agentic AI features by 2028.

Gartner recommends that organisations currently focus their efforts on agentic AI initiatives that offer a clear and measurable return. Attempting to retrofit agents into legacy systems can create integration challenges and increase technical debt. In many instances, redesigning workflows with agentic capability in mind yields stronger, more scalable results.

“To get real value from agentic AI, organisations must focus on enterprise productivity, rather than just individual task augmentation,” said Verma. “They can start by using AI agents when decisions are needed, automation for routine workflows and assistants for simple retrieval. It’s about driving business value through cost, quality, speed and scale.”