How can you navigate your IPO planning with confidence?

Global IPO activity accelerated in Q3 2025, with deal volume rising 19% and proceeds surging 89% year-over-year (YOY), signaling a solid rebound in investor appetite fueled by monetary easing and improving market sentiment. However, the recovery was largely concentrated in a few key regions. Of the 370 deals listed during the quarter, nearly three-quarters were from India, the US and Greater China. These three markets also contributed close to 80% of the total US$48.2b in proceeds, each showing strong YOY growth. Notably, nine of the top 10 global IPOs in Q3 came from these markets, underscoring their dominant role in driving the market’s resurgence.

In Q3, the US achieved its strongest IPO quarter since Q4 2021, with filings and new share issuances surging sharply following a relatively subdued Q2. Meanwhile, India posted a standout performance, with 146 IPOs raising US$7.2b — setting new records in deal number.

Signs of recovery are indeed visible in Europe, the Middle East and parts of Asia-Pacific, though investor selectivity remains a defining feature across these regions. 

Broad recovery in Q1–Q3 sees IPOs outperform major indices

The first nine months of 2025 saw 914 IPOs raising US$110.1b, a gradual recovery in number but over 40% growth by deal size compared with the same period last year.

By area, EMEIA led global IPO activity by deal volume in the first three quarters of the year, followed by Asia-Pacific and the Americas. At the country and exchange level, the US maintained its dominance in global markets, leading in proceeds and market capitalization, with strong IPO returns and high price-to-earnings (P/E) multiples pointing to premium valuations.

The strong performance of the S&P 500 index underscores the prevailing bullish sentiment in equity markets. The technology sector’s dominance in the US has sustained throughout the period, with notable post-IPO performance from high-profile US listings.

The Chinese mainland and Hong Kong have emerged as global leaders in IPO returns. The two markets recorded double-digit YOY growth in both deal volume and proceeds over the first nine months — driven by strong investor appetite in strategic sectors such as advanced manufacturing, mobility, semiconductors and electronics.

South Korea’s IPOs rose notably by both number and proceeds, driven by large-cap listings and strong investor demand in technology and industrials. In ASEAN, Malaysia’s standout IPO return contrasts with its broader market decline, driven by niche tech listings, while the region overall saw fewer but larger IPOs — reflecting the selective timing and valuation discipline that became apparent in Q3.

India’s leadership in IPO volume, supported by strong valuation multiples, underscores the vibrancy of its domestic market. The rise in average deal size reflects growing investor optimism in sectors such as fintech, manufacturing and renewables.

Traditional IPOs and carve-out listings in the Middle East have maintained strong momentum, reaching their highest level since the Global Financial Crisis during the first nine months of the year.

Post-IPO performance surged

The 2025 IPO cohort delivered positive returns across all major regions through the first three quarters. Chinese mainland listings led by a wide margin, with exceptional first-day and sustained gains driven by strong domestic demand and policy support. ASEAN also performed strongly, with gains building progressively. The US and South Korea posted healthy debut pops but more measured follow-through, reflecting valuation discipline in mature markets. Europe and Oceania lagged, with muted performance amid macro uncertainty, though both still achieved double-digit YTD gains.

Early IPO pops remain common, but sustained performance suggests the market is regaining depth and investor confidence, creating a more supportive environment for future listings.

Profitability edges higher on regional and sector gains

Thus far, this year’s IPO class has registered marginal profitability gains on a global average but has shown notable improvement in select markets. This reflects investors’ growing preference for financially sound and well-governed companies — particularly in volatile market conditions where quality and transparency are critical. Profitability gains were most evident in ASEAN, Hong Kong, Oceania and the US. By sector, industrials, consumer, energy, government and public sector, and professional services contributed, with the strongest margins in financials, oil and gas, and public sector offerings. Banking and insurance IPOs benefited from stable cash flows and renewed investor demand for defensive yield, while energy deals captured outsized inflows amid a global push to secure critical resources. 

Global exchanges are accelerating regulatory reforms to strengthen their role in long-term capital formation. Many have streamlined listing requirements, modernized disclosure regimes and relaxed procedural barriers — strategic moves aimed at attracting innovative firms and positioning regional markets as credible alternatives to US dominance. Regulatory reform is increasingly becoming a competitive lever in the global capital market race.

These reforms are tightly aligned with evolving economic and sector priorities. The US continues to leverage its capital markets to maintain technological leadership; China is focused on advanced manufacturing and electric vehicle (EV) supply chains; India prioritizes IT, digital infrastructure and fintech; Europe is investing heavily in industrials and life sciences; and the Middle East is accelerating diversification into sovereign wealth investment, energy and technological sectors. As IPO issuance increasingly follows sectoral themes — green energy, AI/tech, defense tech, health care, infrastructure — exchanges are adapting their regulatory frameworks to support growth in these verticals. Emerging markets are also striving to become regional capital hubs. India, the Middle East and ASEAN are gaining prominence in the IPO landscape, with India’s exchanges already leading globally in deal volume – reflecting stronger market depth and greater dynamism.

Listing rules become more flexible worldwide

Many exchanges in recent years have eased listing requirements to attract innovative and high-growth companies. Hong Kong’s Technology Enterprises Channel (TECH) and biotech framework allow confidential filings and broader eligibility, helping funds raised in H1 2025 jump more than sevenfold YOY. These changes highlight how exchanges are competing with US capital markets and revive volumes in key sectors like technology, financial services and life sciences. While lighter safeguards can raise volatility risks, these new rules have paired flexibility with oversight measures, striking a balance between market access and investor protection. Cross-border connections have also strengthened, with exchanges creating frameworks to attract international issuers and facilitate capital flows across regions.

Pathways emerge beyond traditional IPOs

Global exchanges are widening their playbooks, offering companies more varied routes to the public markets. After their boom and bust in 2021, special purpose acquisition companies (SPACs) have been reshaped with stronger safeguards and continue to play a meaningful role. The 2024 SEC reforms tightened oversight of SPAC and de-SPAC deals, bringing them closer to traditional IPO standards. In 2025, SPACs have accounted for a sizeable share of listings, offering an alternative route amid selective IPO markets, though performance, litigation and sector risks remain.

Direct listings have become more flexible as regulators seek to provide faster, less restrictive routes to market. In parallel, digital finance is reshaping the landscape, with proposals to integrate blockchain-based models and broaden access to alternative assets.

These moves reflect a broader strategic goal: to keep markets relevant, channel capital toward priority sectors such as technology and energy transitions and offer issuers optionality in uncertain conditions. Yet, the lessons of past cycles, where rapid innovation sometimes led to volatility or uneven investor outcomes, underscore the need to balance accessibility with safeguards.

Balancing market access and investor protection

As exchanges move to streamline listing regimes and attract more issuers, regulators are also tightening safeguards to protect market integrity. This balancing act reflects lessons from past cycles of speculative excess and the growing importance of maintaining investor trust in increasingly globalized markets.

Authorities in the US, China and South Korea have stepped up oversight, introducing measures to curb market manipulation, strengthen governance and ensure listings are backed by sustainable fundamentals. At the same time, reforms in places like Australia, Hong Kong and Japan are designed to cut costs and shorten timelines, while Europe and Malaysia are reinforcing transparency to support resilient aftermarket performance.

Together, these initiatives highlight a dual-track approach: creating faster, more flexible access to capital while embedding protections that reduce volatility and restore confidence. For issuers, this often means higher compliance demands, but it also helps ensure more stable post-listing outcomes and a healthier market environment over the long term.

An exit strategy is a crucial part of any private equity (PE) investment. It’s how investors cash out and realize a return on their investment. In 2025, PE firms are relying heavily on M&A and secondary sales reflecting a “bird in hand” preference for speed and certainty, driven by strategic corporate buyers and renewed selling activity. This shift reflects PE firms adjusting valuation expectations to adapt to market volatility and tariff-driven cost pressures that are reshaping global business operations. These routes typically deliver quicker returns and lower execution risk compared with IPOs. However, IPO remains a strategic option for firms aiming to maximize long-term value, offering broader access to public capital and visibility, albeit with added complexity and delayed liquidity.

According to the Q2 2025 EY Private Equity Pulse Survey, two-thirds of general partners (GPs) expect their firms’ exit activity to accelerate over the next six months. As 2025 progresses, this sentiment appears to be materializing. PE firms are increasingly favoring IPOs as a viable exit route, supported by global monetary easing, rallies in major equity benchmarks and regulatory tailwinds benefiting high-growth sectors. In the first three quarters, the number of PE-backed IPO listings more than doubled with proceeds rising by 68%.

This momentum has extended across key markets. PE-backed exits reaching their highest level since 2021 in the US, Europe and India, while Greater China and Japan also recorded notable increases. In particular, the US and Nordics saw PE-backed IPOs account for over two-thirds of total listing value, while in South Korea they represented roughly half of the IPO deal value.

Strong aftermarket gains of PE-backed listings

Global PE-backed issuers have shown solid post-listing momentum, delivering notable short-term and YTD gains across multiple regions. The Chinese mainland, for example, led post-IPO performance across all timeframes, with robust gains across key sectors including industrials, life sciences, energy and technology. Hong Kong, the US and India also recorded double-digit returns for these sponsor-backed IPOs. In Hong Kong, consumer and industrials delivered positive returns, financials traded near offer prices, and technology and life sciences underperformed. India and Japan posted mixed post-IPO outcomes, whereas the US saw robust performance across technology, life sciences, advanced manufacturing and financials. In Europe, industrials and technology lagged, but health care, real estate and financial sponsor-backed IPOs demonstrated resilience.

PE-backed technology IPOs, primarily from the US, delivered strong early trading and sustained momentum throughout the tracked windows, fueled by investor enthusiasm for AI, cloud infrastructure, fintech and health tech themes. Meanwhile, industrial sponsor-backed IPOs posted the most significant YTD gains, supported by robust performance from EV battery and auto parts manufacturers, as well as semiconductor companies, primarily from the Chinese mainland. Health and life sciences also performed strongly, led by healthcare providers and diagnostics from Europe, the US and Hong Kong.

In real estate, hospitality and construction, India saw a notable rise in PE-backed issuers, with solid aftermarket returns, while Europe and the Middle East added depth to the sector’s footprint. Energy IPOs re-emerged with PE sponsorship but saw mixed results, with early gains tapering off amid market volatility and transition uncertainty. Consumer IPOs, though fewer, delivered some of the strongest returns, while financials saw more selective PE interest, with modest but stable performance.

Technology and industrials dominate PE-backed IPOs

PE sponsors continue to take a more deliberate approach to when and which companies they bring to the public markets amid ongoing macro uncertainty. However, as borrowing cost ease and valuation gaps narrow, the tailwinds for a sustained recovery continue to coalesce. 

Technology IPOs — particularly in software, software-as-a-service (SaaS), apps and cloud platforms — have led the recovery in PE-backed exits with most activity in the US, dominating large public listings this year. Industrials have also seen strong momentum, with China accounting for the bulk of PE-backed listings, especially among component suppliers and machinery firms. While tech IPO volumes have surpassed the combined total of the first nine months of past three years, they remain well below 2021’s peak. In contrast, PE-backed industrials have fully rebounded, matching 2021 levels in both deal count and proceeds.

Among the top 10 YTD global PE-backed IPOs, a majority were profitable at the time of listing, reflecting sponsors’ growing focus on bringing only mature, earnings-generating companies to market. Performance has also been robust: eight of these deals traded above their offer prices by late September, with several delivering exceptional gains — exceeding 30 times investors’ initial outlay. The trend underscores PE firms’ focus on careful exit timing, resilient business models and strong post-listing visibility.

Business implications

Preparing for an IPO sets the highest bar for readiness across operational, financial and governance dimensions. Companies achieving IPO-readiness become well-positioned for alternative exits like M&A, secondary buyout or dual listings, providing strategic flexibility in markets where timing and sentiment shift rapidly. This flexibility is critical given the challenges funds face when approaching an exit versus the benefits associated with getting equity story and readiness right.

Success demands compelling narratives that resonate with PE investors and public market stakeholders, prioritizing profitability pathways, robust governance and ESG alignment. Companies must demonstrate specific value inflection points and articulate how IPO proceeds will fuel innovation, deleveraging and sustainable growth. Meanwhile, PE firms must develop comprehensive post-listing strategies extending beyond initial offerings. This includes managing lock-up periods strategically, executing staged exit plans, maintaining active boardroom involvement, and ensuring continued engagement post-IPO to retain influence over strategic decisions that drive value creation.

For firms that are IPO-ready, every exit remains possible, and the potential upside may outweigh faster alternatives, particularly when timed around growth inflection points, supported by compelling equity stories and aligned with market windows.

The global IPO market outlook for the last quarter of 2025 and early 2026 carries more optimism than previous quarters, supported by several encouraging tailwinds.

Monetary policy across major economies is easing, albeit unevenly. A combination of softer growth momentum and moderating inflation — before the renewed inflationary impulse from US tariffs — has led central banks in the US, euro area, UK, China and key emerging markets to cut rates or prepare for further policy recalibration. Short-term interest rates have declined, and overall financial conditions remain broadly accommodative. Encouragingly, resilient corporate earnings and strong equity market performance continue to underpin investor confidence. While future adjustments will remain data-dependent, the shift toward easing is helping to bolster market sentiment.

Post-listing performances are further reinforcing investor appetite, especially among issuers with scalable business models and credible growth narratives. Regional strength in the US, the Chinese mainland, Hong Kong, India and the Middle East are rebounding quicker than other regions.

Yet, significant headwinds remain. Inflation persists and the macroeconomic outlook remains uncertain, which undermines confidence. The Fed’s mid-September “risk management” rate cuts come amid conflicting economic data and political manoeuvring, underscoring the fragility of the economic outlook with mounting signs of slowdown. Long-term rates have faced upward pressure due to idiosyncratic dynamics and rising concerns around fiscal sustainability. Political instability, such as the US government shutdown, and concerns over Fed independence raise risk premiums. Elevated bond yields increase discount rates, making IPO valuations less attractive and forcing issuers to deliver clear profitability paths, not just narratives. 

The rapid expansion of private capital has reshaped funding landscapes, offering abundant capital and flexibility. Many companies now choose to remain private longer, maintaining strategic control while avoiding public market complexity. IPOs are no longer the default path to scale. Private capital has become a parallel engine of innovation, meaning IPO readiness must be strategic and aligned with evolving expectations.

Growth that delivers

The September 2025 EY Global IPO Pulse Survey revealed that investors strongly favor growth-oriented narratives over value-based ones, with technology, financial services, and health and life sciences emerging as the top-ranked sectors. Demand is particularly strong in areas such as AI, fintech, defense tech and health tech, where business models are proving both innovative and scalable.

At the same time, regulators are reshaping how these transactions unfold. While new pathways are widening access to public markets, oversight on disclosure, governance and accountability is tightening. As a result, IPO readiness today requires more than compelling growth potential: issuers must demonstrate transparency, financial discipline and precise execution.

Short-term clarity meets long-term uncertainty

In the current environment, investors find themselves in an unusual position of having more clarity about the short-term geopolitical and regulatory landscape than the long-term outlook. At the same time, there's growing awareness that long-standing macro foundations, such as predictable inflation targets, central bank independence (in the US) and global policy coordination, are no longer as reliable. AI disruption is also accelerating change across industries as cost structures are compressing, processes are being automated and new competitive moats are emerging. All these have introduced a layer of structural uncertainty that makes long-term forecasting more difficult, as traditional models based on stable policy regimes are no longer sufficient. Recent movements in the US Treasury yield curve underscore this shift, with both the 30-year vs. 10-year and the 10-year vs. 2-year spreads widening sharply, highlighting investor anxiety over the durability of long-term assumptions.

Against this backdrop, investors are prioritizing factors that offer immediate clarity and strategic relevance. According to the September EY IPO Pulse Survey, while over 80% of respondents acknowledge the impact of geopolitical risks on the IPO market, their top consideration is how companies are adapting to AI and digital transformation. This forward-looking focus outweighs concerns around inflation, interest rates and corporate earnings, suggesting that investors are seeking resilience and innovation in the face of structural uncertainty.