PurposeThis study, using stakeholder theory and diffusion of innovations (DOIs), aims to examine the readiness of Omani health-care firms to adopt artificial intelligence (AI). This adoption is seen as a key step towards ensuring green innovation and sustainable performance (SP) in the health-care sector.Design/methodology/approachThis study adopted convenience and referral sampling techniques to enhance the response rate for the limited number of health-care firms using AI. Using explanatory research design, structure equation modelling and employees as the unit of analysis, a random sample technique is used to distribute the structured questionnaire to five hospitals in North Al-Batinah, including Shinas, Liwa and Sohar cities. Smart PLS 4.1 analyses the responses.FindingsThe research demonstrates that AI could significantly enhance SP, a finding that is of utmost importance in the current health-care landscape. This study also tested green knowledge sharing as a boundary condition. Furthermore, the study's findings indicate that AI leads to the emergence of green innovation and SP, suggesting that firms are willing to adopt AI and achieve the sustainable development goals (SDGs).Practical implicationsThis study implies that stakeholders, including the Omani Government and Middle Eastern firms, should prioritize investments in AI technologies tailored to sustainability initiatives.Originality/valueThis research study makes three significant and unique contributions. Firstly, it uniquely integrates stakeholder and DOIs theories to explain the mediating function of green innovation and the moderating effect of green knowledge sharing. Secondly, it provides a unique Middle Eastern context, where the government's focus on the health sector is crucial. Finally, this study outlines a clear and actionable pathway for the Middle East to achieve the SDGs, thereby enlightening the reader on the potential of AI in the health-care sector.