A new Gartner report predicts that more than 40% of Agentic AI projects could be abandoned by 2027.
The reasons include high running costs, security concerns, and unclear benefits for businesses.
While interest in AI is growing, many projects are still in early experimental stages and shaped more by hype than solid planning.
Gartner surveyed over 3,400 AI vendors and found that only about 130 offered truly innovative Agentic AI tools.
Most others were simply rebranding old technologies like chatbots and automation as “new AI” offerings. This trend, called “agent washing,” creates confusion and makes it harder for firms to pick the right solutions.
Analyst Anushree Verma warns that many early AI efforts are misunderstood and misused.
Companies often launch projects with unrealistic expectations, only to abandon them later when the actual cost and complexity become apparent. This results in wasted time, money, and resources across the industry.
Still, the report predicts a brighter future for AI. By 2028, Agentic AI could be making 15% of daily business decisions and powering a third of enterprise software. Yet, this trend should also serve as a warning for venture capitalists.
Those pouring millions into AI startups must recognize that many will struggle or fail as the market evolves, and only a handful will survive to justify their investment.
“Many AI startups seem promising on paper, but when put into practice, they can quickly become irrelevant or obsolete — much like how pagers became a futile product soon after their launch due to the mobile phone revolution", said an analyst who has been surveying the ongoing AI projects.
