State of AI Apps 2025 report

Sensor Tower has recently published its highly anticipated State of AI Apps 2025 report, providing an in-depth look at the mobile AI ecosystem and digital advertising dynamics for the first half of 2025. This extensive report reveals unprecedented growth in generative AI usage, shifting user demographics, app monetization strategies, and the increasing overlap between mobile and web-based AI engagement.

Sensor Tower unveils State of AI Apps 2025 report: AI Apps Surge in Popularity and Monetization

The report outlines explosive growth in generative AI apps across both Google Play and the App Store. According to Sensor Tower’s data, downloads of generative AI apps reached record highs, while global IAP (in-app purchase) revenue also experienced a significant boost. Notably, Asia has emerged as the fastest-growing region in terms of generative AI app adoption, driven largely by user demand for creative, image-based AI tools. North America, however, continues to lead in monetization, generating the highest IAP revenue.

A standout trend highlighted in the report is the growing dominance of image generation within AI assistants. ChatGPT, Gemini, Copilot, and new entrants like DeepSeek have integrated visual creation tools, fueling higher download volumes and longer user sessions.

One of the most striking findings is the rapid ascent of DeepSeek, a new AI assistant that surpassed ChatGPT’s first-year download performance. In less than a year, DeepSeek accumulated more than 20 million downloads globally, signaling a competitive shift in the AI assistant market.

At the same time, ChatGPT maintained a stronghold in usage and engagement, with consistent growth in both cross-device use and frequency of prompts. Sensor Tower data indicates that ChatGPT users often turn to the platform as frequently as Reddit or X (formerly Twitter), and engagement tends to increase on weekends—an indicator of broader consumer acceptance.

The State of AI Apps 2025 report also explores changing user demographics. Young men remain the dominant user group for AI apps, but adoption among women and older age groups is steadily rising. App overlap metrics show that ChatGPT and Gemini users are also likely to engage with crypto trading platforms and P2P payment services, suggesting strong appeal among tech-savvy and financially engaged audiences.

ChatGPT’s use cases continue to expand, with more than one in three prompts focused on lifestyle and entertainment. Other top categories include education, wellness, and shopping. Health and wellness, in particular, saw one of the highest year-over-year increases in prompt volume, reflecting broader consumer interest in AI-assisted self-care and productivity.

Sensor Tower State of AI Apps 2025 Report    

Sensor Tower’s analysis reveals that app developers and digital advertisers are increasingly optimizing for discovery within AI tools themselves. The emergence of “generative engine optimization” (GEO) is evident in the surge of ChatGPT prompts that reference brand names, websites, and domains. Coding-related sites such as Stack Overflow and GitHub consistently rank among the most-cited sources, along with Reddit communities like r/learnpython and r/chatgpt.

Notably, AI apps that included “AI” in their titles saw short-term spikes in downloads, particularly in the note-taking and diet/nutrition categories. However, sustained performance depended on deeper engagement features such as voice mode, image generation, and personalized assistant experiences.

The second half of the report focuses on digital advertising, where generative AI tools are reshaping creative strategies. The U.S. led all countries in generative AI digital ad spend during H1 2025, followed by the UK and Germany. Adobe, Microsoft, and Google ranked among the top advertisers, each leveraging custom ad creatives that prominently feature AI-generated imagery.

OpenAI made a significant push into advertising during Q2, moving up the ranks in both ad spend and creative output. Finance and health verticals showed the strongest growth in unique creatives mentioning AI, while Best Buy led retail media in AI-driven campaigns. Ads featuring AI-generated animals and personalized use cases were among the most engaging, signaling new creative frontiers.

Custom product pages tied to AI-related keywords like “image generator” have also become a high-converting strategy, especially on platforms such as Apple Search Ads. This trend highlights the convergence of organic and paid visibility in AI app promotion.

The State of AI Apps 2025 report underscores a transformative period in the app economy. For developers, the key takeaways include:

• Platform expansion: Cross-device and cross-platform functionality is critical for long-term retention.
• SEO within AI: Optimizing for visibility within AI chat tools is becoming as important as traditional app store optimization.
• User expectations: Image generation, real-time answers, and voice interactions are no longer optional—they are expected.

Yearly download and IAP revenue trends for generative AI apps