Animal healthcare spending is climbing steadily worldwide, with new veterinary services market research showing the global industry was valued at USD 123.44 billion in 2023, is estimated to reach USD 131.11 billion in 2024, and is projected to climb to USD 212.25 billion by 2031, at a compound annual growth rate of 7.12%. The expansion is being driven by rising pet ownership in urban areas, growing awareness of preventative animal healthcare, and rapid advances in diagnostic and telemedicine technologies.
Veterinary services span a broad range of medical and healthcare offerings for diagnosing, treating, and preventing disease and injury in animals, including routine check-ups, vaccinations, surgical procedures, dental care, diagnostic testing, and emergency care for pets, livestock, wildlife, and exotic animals. These services are delivered by licensed veterinarians, technicians, and allied professionals across clinics, hospitals, farms, and research facilities, and play a critical role in addressing zoonotic diseases that carry implications for human health as well.
Pet Humanization Drives Spending on Advanced Care
A defining force behind market growth is the increasing tendency of pet owners to view their animals as family members, a trend that is translating directly into higher spending on routine check-ups, vaccinations, and emergency treatments. According to the HealthforAnimals report, over half of the global population owned a pet in 2023, and pet adoptions surged notably during pandemic lockdowns, with more than two million adoptions in the UK and over one million in Australia.
This humanization trend is particularly pronounced in North America. The 2023-2024 National Pet Owners Survey by the American Pet Products Association found that approximately 66% of U.S. households, or roughly 86.9 million families, own a pet, while total U.S. pet industry expenditures reached USD 147 billion in 2023, a 7.5% increase from USD 136.8 billion in 2022.
Pet Insurance Adoption Expands Access to Care
The growing uptake of pet insurance is making veterinary care more financially accessible, driving higher utilization of both routine and emergency services. The Insurance Information Institute reported that U.S. pet insurance premiums reached USD 3.9 billion in 2023, covering approximately 5.7 million pets and marking a 17% increase from the prior year. Total U.S. pet industry spending, meanwhile, grew from USD 97.1 billion in 2019 to USD 150.6 billion in 2024, underscoring the scale of the broader pet care economy that veterinary services sit within.
AI and Telemedicine Transform Diagnostics
Technological innovation is reshaping how veterinary care is delivered. Advances in telemedicine, diagnostic imaging, and minimally invasive surgical techniques are improving both the quality and accessibility of care, while artificial intelligence is increasingly being integrated into diagnostics and treatment planning. In November 2023, veterinarians at the University of California developed AI algorithms capable of detecting Addison’s disease and leptospirosis in dogs, training a model on routine blood work from more than 1,000 dogs to identify complex disease patterns with over 99% accuracy for Addison’s disease alone.
These technological gains are also helping address a persistent challenge: the high cost of advanced veterinary services, which can place specialized treatments and diagnostics out of reach for budget-constrained pet owners. In response, providers are introducing flexible payment plans, subscription-based wellness programs, and pet insurance collaborations, while telemedicine platforms and mobile veterinary clinics are extending affordable care to rural and underserved communities.
Companion Animals and Diagnostics Lead Segments
By animal type, companion animals generated USD 70.77 billion in revenue in 2023 and are projected to remain the dominant segment through 2031, reaching a forecast USD 123.29 billion, driven by rising global pet adoption and growing expenditure on advanced treatments. By service type, diagnostic services held a 43.44% share in 2023 and are expected to reach USD 104.24 billion by 2031, reflecting the increasing prevalence of complex animal diseases requiring sophisticated diagnostic tools for accurate detection.
North America Leads, Asia-Pacific Poised for Fastest Growth
North America accounted for the largest regional share in 2023 at 36.74%, valued at USD 45.35 billion, supported by high pet ownership rates, strong humanization trends, and expanding mobile veterinary services that improve access in rural areas. Rising adoption of pet insurance across the region is further enabling owners to afford both routine and emergency care.
Asia-Pacific is projected to be the fastest-growing region, expanding at a CAGR of 8.39% through 2031 to reach a forecast USD 48.02 billion, as veterinary clinics, pet hospitals, and mobile services expand into rural and underserved areas. Governments in India and South Korea are also implementing stricter animal welfare regulations, creating a more favorable environment for market expansion.
Regulatory Landscape and Competitive Developments
Regulatory oversight varies by region: in the U.S., the FDA regulates veterinary drugs while the USDA’s Animal and Plant Health Inspection Service enforces animal health and welfare standards. In the European Union, Regulation (EU) 2019/6 modernized the authorization framework for veterinary medicines and strengthened efforts against antimicrobial resistance. Japan’s Ministry of Agriculture, Forestry, and Fisheries and Australia’s Australian Pesticides and Veterinary Medicines Authority similarly enforce rigorous standards in their respective markets.
Leading companies including Mars, Incorporated, Greencross Vets, National Veterinary Care Ltd., Pets at Home PLC, CVS Limited, National Veterinary Associates, Zoetis Services LLC, Vetoquinol, and Merck & Co., Inc. continue to expand through acquisitions and product approvals. In July 2024, Merck Animal Health finalized its acquisition of Elanco Animal Health’s aqua business, while Mars Veterinary Health entered the Indian market in December 2024 through a minority investment in Crown Veterinary Services.
Corporate Consolidation Reshapes Practice Ownership
The veterinary services landscape is undergoing significant structural change as corporate consolidators continue acquiring independent practices at a steady pace across North America and Europe. This trend toward corporate ownership is bringing greater standardization to clinical protocols, purchasing power for medical supplies and equipment, and access to centralized administrative resources that many independent practitioners previously lacked. At the same time, this consolidation wave is raising questions within the veterinary profession about maintaining the personalized, community-oriented care model that has traditionally defined the industry.
Private equity involvement in veterinary practice consolidation has accelerated notably in recent years, drawn by the sector’s recurring revenue characteristics and relatively recession-resistant demand profile, as pet owners generally maintain baseline veterinary spending even during economic downturns. This sustained investor interest is expected to continue driving practice roll-up activity, though it also introduces new dynamics around staff retention and clinical autonomy that practice groups must navigate carefully to maintain service quality and veterinarian satisfaction.
Veterinary Workforce Shortage Constrains Capacity
A persistent shortage of licensed veterinarians and veterinary technicians represents one of the most significant structural constraints on market growth, particularly across North America and parts of Europe. Veterinary school capacity has struggled to keep pace with rising demand for services, creating extended wait times for appointments and contributing to burnout among practicing veterinarians who face increasingly heavy caseloads. This workforce shortage is prompting industry stakeholders to explore expanded roles for veterinary technicians and support staff, alongside investment in efficiency-enhancing technologies that allow existing clinical staff to manage higher patient volumes without compromising care quality.
Several veterinary schools and industry associations have launched initiatives aimed at expanding enrollment capacity and improving the financial accessibility of veterinary education, recognizing that addressing the workforce pipeline represents a long-term structural necessity for sustaining the market’s projected growth trajectory. In the interim, telemedicine platforms are helping partially offset capacity constraints by enabling veterinarians to handle routine consultations remotely, freeing up in-clinic capacity for procedures requiring hands-on care.
Implications for Stakeholders Across the Value Chain
For practice owners and corporate consolidators, the market’s growth trajectory supports continued investment in expanding clinical capacity, though success will increasingly depend on effectively addressing workforce recruitment and retention challenges alongside pure geographic expansion. Practices that invest in staff wellbeing and efficient clinical workflows are likely to outperform peers focused purely on volume growth.
For pharmaceutical and diagnostic technology providers serving the veterinary channel, continued investment in AI-enabled diagnostic tools and point-of-care testing solutions offers a clear pathway to capturing value as practices seek technologies that can extend the effective capacity of a constrained veterinary workforce. Companies that can demonstrate clear efficiency gains and improved diagnostic accuracy are likely to find receptive customers among practice groups navigating capacity constraints.
Outlook
As pet ownership continues to rise globally and owners increasingly prioritize preventative and specialized care, the veterinary services market is set for durable growth through 2031. Providers that combine expanded access through telemedicine and mobile clinics with investment in AI-enabled diagnostics are best positioned to capture the opportunity ahead.