Nagham Hassan, Market Analyst, etoro
Abu Dhabi, United Arab Emirates – August, 2026: During this Q2 earnings season, investors watched whether the huge investment in artificial intelligence by companies around the world is turning into real profit. The results were split. The winners were the chip makers, cloud providers and data centre operators selling AI infrastructure. Enterprise software lagged behind, with much of the money spent still sitting on balance sheets rather than in earnings.
Nagham Hassan, Market Analyst at etoro explores the question: Did the UAE AI sector follow the same global trend?
The players:
The UAE AI sector is less a group of competing companies and more of an ecosystem sitting under the structure that is G42.
G42 is a privately held Abu Dhabi-based artificial intelligence and cloud computing holding company. Mubadala and Silver Lake both hold stakes, and Microsoft bought a minority stake for $1.5 billion in 2024.
Its companies cover the full AI value chain. Khazna builds the data centres, Core42 runs the sovereign cloud and computing, and Inception develops the models. Then come the applications: Presight in government analytics (which in turn owns 51% of AIQ, G42’s energy joint venture with ADNOC), alongside M42 in healthcare and CPX in cybersecurity. G42 is also a major shareholder in Space42, the satellites and geospatial intelligence company.
Only Presight and Space42 are listed, so we can only learn about the state of the local AI sector from their reports.
What they reported:
Presight grew, and it grew fast. In the second quarter of 2026, revenue rose 36.1% year on year to AED 713.2 million and net profit rose 30.2% to AED 116.8 million. Most of that growth was already locked in. It signed AED 2.53 billion of new orders in the quarter, taking its order book to AED 4.88 billion, and multi-year contracts made up 93.5% of second quarter revenue.
That comes with a tradeoff. Margins narrowed over the first half as more revenue shifted to infrastructure work and third-party services through AIQ, which pay less. Presight also books revenue as projects progress but invoices later, and by June the gap between work delivered and cash received hit AED 2.22 billion.
At Space42, it’s the core satellite business that’s driving results and funding the company’s AI ambitions. Group revenue grew 29% in the quarter, almost all from satellites, which brought in USD 225 million over the first half on a USD 700 million government contract. Revenue from Smart Solutions, the AI and geospatial unit, more than doubled in the quarter and reached 13% of group revenue, but lost USD 15 million over the six months at the EBITDA level, the measure of whether a business covers its running costs.
Space42’s half-year profit halved to USD 18 million, but AI had nothing to do with it. The new Thuraya-4 satellite just went into service, so its cost is being expensed gradually, pushing total depreciation up 19% to USD 98 million. Smart Solutions broke even in the second quarter, but the profits still come from satellites.
The others:
Outside G42, AI is mostly contributing to spending rather than earnings. e& and du both keep AI inside wider enterprise divisions. At e& that is e& enterprise, which sells AI, cloud, cybersecurity and digital transformation to companies and government, and it made 4.5% of group revenue in the quarter but just half a percent of group EBITDA, with revenue down 4.7% year on year. At du, that is the ICT segment, which made 11% of first half revenue and 3.5% of gross profit. du is the one building, raising Q2 capital spending by 19.8%, partly to construct data centres for an unnamed hyperscaler.
Phoenix Group took the sharpest turn. The Abu Dhabi bitcoin miner announced an 18MW AI data centre in Lyon, France, due to break ground in the third quarter. Its revenue in the quarter still came entirely from mining and hosting.
Approvals and investment is moving faster than earnings. Washington cleared G42 to buy the equivalent of 35,000 Nvidia chips in November last year and eased UAE access to advanced computing in July 2026. Microsoft has committed $15.2 billion to the UAE through 2029.
So did the UAE follow the global trend? It’s hard to tell. Most AI companies here are private and therefore do not report, and the one that does, Presight, is profitable. For the rest it will take more quarters to see whether the buildout turns into earnings. Until those sites are running, the UAE will have an AI sector that is easy to see but hard to measure.
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