The market for AI companion applications is rapidly expanding, projected to generate $120 million by year-end, up from $82 million in the first half of 2025 alone. With 337 active apps, 128 launched this year, and downloads increasing by 88% year-over-year to 60 million, user engagement is on the rise. Notably, the top 10% of apps generate 89% of the revenue, indicating a concentrated market battle for dominance.