Nearly all organizations within the Philippines, about 92%, used artificial intelligence (AI) in some form in 2025, but deployment stays shallow, with the bulk still on the pilot stage resulting from talent scarcity and concerns over security and privacy, in keeping with the Philippine AI Report 2025.
The report was produced by Swarm, a world AI consultancy firm, which surveyed 175 organizations across the technology, financial services, healthcare, and retail sectors. It also covered manufacturing, government, education, and nonprofit organizations, making it the biggest published survey of enterprise AI adoption within the country to this point, the report said.
Amongst its key findings is that AI has moved from theory to practice for many organizations within the country. Over 92% of Philippine organizations have used AI in some form over the past 12 months, while 8% said they didn’t use AI in any respect.
“The prevailing mindset is now considered one of lively experimentation, with AI increasingly viewed as obligatory to stay competitive,” the report said.
Despite organizations experimenting with AI, adoption within the country stays shallow, with a striking 65% of organizations still on the pilot phase, or proof-of-concept stage, testing solutions in controlled environments or small-scale trials.
Only a smaller share have moved to full production deployment, the report said.
“The concentration at proof-of-concept reveals the central tension in Philippine AI adoption: enthusiasm has outpaced execution. Organizations have demonstrated they will launch pilots. The query is whether or not they can operationalize them,” the report said.
Other AI initiatives by organizations include AI application development for products at 47%, end-user AI enablement through training and onboarding at 41%, internal tooling development at 36%, applied AI development at 30%, fundamental AI research at 28%, vendor evaluation at 27%, and large-scale integration of third-party AI services at 25%.
AI strategy amongst organizations also showed strong backing from executives, with 61% of respondents saying C-suite executives directly lead AI initiatives.
Despite organizations’ high interest and executives’ strong support for AI, structural challenges hamper the country from scaling beyond pilots.
Talent scarcity tops the list, with 57% of organizations reporting a shortage of AI-skilled personnel, comparable to data scientists, AI engineers, and technically trained staff.
This skills gap stalls projects and limits the complete use of AI tools, as teams struggle with technical roadblocks and business managers sometimes lack understanding of AI capabilities.
Security and privacy concerns follow closely at 40%, as corporations remain cautious about feeding sensitive data into AI systems, particularly through third-party cloud services, resulting from fears of breaches or compliance violations.
Other barriers mentioned were unrealistic expectations (36%), internal development hurdles (34%), concerns about tool quality (28%), IT-business misalignment (26%), worker resistance (24%), and extra challenges comparable to regulatory hurdles, data gaps, or insufficient executive buy-in (13%).
To deal with the talent shortage, the study really useful upskilling existing employees.
Organizations are advised to dedicate the vast majority of AI resources to people and processes, following a 10-20-70 model: 10% for algorithms, 20% for technology, and 70% for workforce development, to speed up adoption.
Immediate talent gaps can be addressed through targeted hiring or partnerships with universities, AI consultancies, or technology providers. The study noted that only 12% of Philippine organizations currently have an AI compliance or governance officer.
It also suggested organizations align with national frameworks comparable to the Philippine Skills Framework for Artificial Intelligence (PSF-AAI), which defines AI-related job roles, required skills and competencies, and profession pathways while helping corporations access government-supported training and upskilling programs.
Lastly, the report said addressing the AI talent gap requires collective motion across industries.
It encouraged organizations to take part in industry working groups developing AI skills standards and to support scholarships, bootcamps, and training programs to expand the talent pool.
Corporations that put money into developing the broader AI ecosystem may also construct early relationships with emerging talent before competitors.
The Philippine AI Report 2025 goals to grasp the present level of AI adoption amongst local enterprises and what organizations must do to scale its use.
“We began this research because we wanted to grasp what AI adoption actually looks like within the Philippines and have data to back it,” said Tim Santos, project lead of the report.
He added that while global studies track adoption curves and investment trends, they don’t capture the country’s nuances, comparable to how corporations make decisions, the supply of talent, and the return-on-investment requirements that shape implementation timelines.
The report seeks to offer business leaders the evidence they should plan the following steps for AI adoption. — Edg Adrian A. Eva