The leaps and bounds achieved in the realm of Artificial Intelligence (AI) technology have had a significant impact on various industry sectors, from healthcare to finance. None have been immune to the sweeping changes brought upon by this advancement, and the gaming industry is no exception.

AI Transforming the Game Development

The integration of AI in game development has revolutionized it to an unprecedented extent. The evolution is noticeable in areas such as gaming algorithms, character development, dynamics, and user experience.

The use of Artificial Intelligence in gaming algorithms helps to create more engaging, responsive, and challenging in-game environments. AI algorithms can essentially learn from player interactions and adjust the game's difficulty level accordingly, making the gaming experience more invigorating and captivating.

In terms of character development, AI-powered tools provide developers with the ability to create more realistic, emotive, and believable characters. These characters can adapt to player’s strategy and improve the overall player-game interaction.

AI has also expanded the dynamics of games. It has enabled the incorporation of real-time changes into the gaming environment, akin to changes one may experience in the real world. The influence of AI on user experience is incalculable - personalizing games to align with the users' preferences increasing their overall enjoyment and engagement.

AI's Influence on the Esports Arena

The esports industry, a sector witnessing exponential growth, has not been left behind in this AI revolution. The integration of AI in esports ranges from training professional players to modifying digital battlegrounds.

AI programs are being developed to simulate professional players' gameplay, providing a realistic training experience. This helps competitors understand different strategies and identify areas where they can improve. AI's influence also stretches to the modification of gameplay in digital battlegrounds, improving spectator experience with seamless automatic highlight detection and presenting more immersive ways to enjoy esports.

In conclusion, the transformation brought upon by AI in the gaming and esports industries is just the beginning. As Artificial Intelligence technologies continue to evolve, we can only expect their influence to involve more dynamic and immersive gaming experiences while continuing to shape the esports sector.