The UK's artificial intelligence industry has drawn a record £12 billion in private investment in the first half of 2026, cementing London's position as Europe's leading technology hub and outpacing rivals in Paris and Berlin.

The figures, compiled by Tech Nation and released this week, show a 34% year-on-year increase in AI-focused venture capital deals. Sectors attracting the most funding include healthcare AI, fintech automation, and defence technology.

Science and Technology Secretary Peter Kyle hailed the numbers as proof that Britain was "winning the global race for the industries of the future," pointing to the government's AI Opportunities Action Plan as a key driver of investor confidence.

London-based DeepMind spinout Cortex Labs announced the largest single deal, securing £1.8 billion to develop next-generation reasoning models. The company said it would create over 2,000 jobs in the UK over the next three years.

However, critics have raised concerns about the concentration of investment in London and the South East, with calls for greater distribution of tech funding to cities like Manchester, Leeds, and Edinburgh.

The government has promised to address regional imbalances through its £2 billion Northern Tech Fund, though opposition MPs have argued the fund remains underspent.