What record first-half proceeds signal for the US IPO market

Improved market conditions and a strong pipeline are fueling momentum for US IPO activity in the second half of 2026.

In brief

• Total US IPO proceeds rose sharply in 1H 2026 as the market reaccelerated, amplified by 12 $1+ billion deals, including a historic mega-IPO. 
• AI and AI-adjacent sectors remain key IPO drivers, with signs of broader sector participation on the horizon. 
• Optimism abounds for 2H 2026 issuance; however, interest rates, geopolitics and AI-related spending concerns remain watchpoints.

The US IPO market: Strong fundamentals underpinned first-half activity

In 1H 2026, US IPO issuance spiked after a few years of fairly subdued activity. The year began with an optimistic tone, but geopolitical concerns and higher energy prices tempered the enthusiasm. After recalibrating for energy price volatility and a shifting geopolitical landscape, Q2 got off to a solid start, capitalizing on strong investor receptivity. Robust IPO market indicators during the half included several record market highs, manageable market volatility despite a few spikes, a deep IPO backlog and constructive post-IPO returns. This momentum was reflected in new issues raising more than $50 million, which rose an average of nearly 20% through June 30, 2026. The second quarter closed with the highest total quarterly proceeds level on record, anchored by the single largest IPO in history.

The current IPO market resurgence has been significantly bolstered by AI-related issuance. Aerospace, defense and biotech have also been active, and the breadth of companies in the pipeline is signaling broader sector participation in the coming quarters. The leading sectors were propelled by a few notable tailwinds, including rising defense spending and momentum in AI and AI-infrastructure investments. Enterprise software, once a highly prolific source of IPO candidates, has remained largely muted as the market continues to assess the impact of AI on software business models. At the same time, investors have shown demand for new issues from pre-revenue technology businesses with disruptive potential, including geothermal and nuclear energy, and quantum computing companies. Sponsor-backed IPO activity saw an uptick in the first half with several notable transactions that were well received by investors, which could help drive greater sponsor participation going forward.

Outlook: US IPO market poised to benefit from favorable tailwinds

The US IPO market enters the second half of the year with a strong pipeline of companies seeking public listings. However, several factors, including inflation concerns and geopolitical tensions, could shape the pace and breadth of issuance in the months and quarters ahead.

AI remains both a major opportunity and an area of potential investor concern. Institutional appetite for AI and AI-adjacent issuers is expected to stay strong, but questions around AI investment spending levels could contribute to wavering investor sentiment.

Sustaining the momentum in the IPO market will require a market backdrop in which investors continue to compartmentalize geopolitical developments and a potentially more challenging rate environment. At the same time, investors are likely to remain focused on the quality, durability and predictability of earnings as well as exposure to longer-term disruptive trends. The extensive pipeline of IPO candidates means the supply should be there if investor enthusiasm remains. As always, prospective issuers will need thoughtful preparation and flexibility in their timing as the year continues to play out.