Baku. 19 January. REPORT.AZ/ ISIS lost almost a quarter of its territory in 2016, Report informs citing the BBC.
The group gave up almost 18,000 sq km, its territory being reduced to some 60,400 sq km.
IHS Markit predicted the recapture of Mosul by Iraqi government forces by the middle of the year.
But it said the stronghold of Raqqa would be a tougher nut to crack.
IHS Markit said the 23% reduction in IS-held territory in 2016 followed on from a 14% loss the year before.
"ISIS suffered unprecedented territorial losses in 2016, including key areas vital for the group's governance project," said Columb Strack, senior analyst and head of the IHS Conflict Monitor.
He said that this came despite ISIS retaking the city of Palmyra in December, "from a Syrian government preoccupied at the time with Aleppo".
In Mosul, Iraq's second city, which has been under the control of the extremists since 2014 - Iraqi government forces had "made steady progress" in eastern districts, the report says, although they have been meeting heavy resistance in recent days.
Mr Strack said: "We expect Iraqi government forces to recapture Mosul before the second half of the year.