FY’25 highlights
Deal values rebound despite lower volumes
During H1’26, the number of announced M&A deals fell 9% YoY to 24,583 globally, from 26,873 in H1’25. Despite the decline in volumes, aggregate deal value rose 50% to USD 2.8 trillion, the strongest opening level of dealmaking since 2021. Regionally, M&A activities increased in the US and Europe by 80% and 105% YoY, respectively, with the US accounting for 54% of total deal volume, marking its strongest period of deal‑making in five years. Conversely, APAC M&A activity declined 2% YoY, marking the slowest period for M&A in the region in two years. Geopolitical tensions, trade frictions and regulatory uncertainty continued to weigh on global sentiment. Despite these challenges, the Technology and Industrial sectors led the market, accounting for 24% and 14% of total global deal value, respectively. Private equity‑backed buyouts accounted for 21% of M&A activity in H1’26, while mega deals dominated the landscape, with 48 transactions exceeding USD10 billion, marking the strongest period since records began in 1980.
Global debt capital market (DCM) hits record high in H1’26
Global DCM activity remained strong in H1’26, reaching USD7.1 trillion, up 7% compared with H1’25, marking the market’s strongest opening half since 1980. The number of new offerings declined by 12% YoY to nearly 17,000, the lowest level in three years. Investment-grade corporate debt issuance grew by 10% YoY, representing the strongest opening first-half period for global high-grade corporate debt on record and the second consecutive quarter to surpass USD1.5 trillion. Similarly, high-yield debt issuance rose 12% YoY. Green bond issuance totaled USD308 billion, up 16% compared with H1’25, while the number of green bond issues increased 8% YoY. Across sectors, retail and technology issuance more than doubled year-over-year, while telecommunications and media also recorded strong growth.
ECM activity accelerates as IPO and convertible surge
During H1’26, global equity capital markets (ECM) activity reached USD569 billion, up 72% YoY, marking the strongest first-half performance in five years. The US issuance remained the primary driver of global ECM activity, contributing 53% of total proceeds (USD302 billion), more than twice the prior year's level, while China ECM activity grew 35% YoY to USD 78 billion. Global IPO proceeds (excluding SPACs) reached USD 170 billion, more than triple the level recorded a year ago and the strongest period for global IPO activity since 2021. IPO proceeds on US exchanges reached USD127 billion, more than seven times H1’25 levels and a five-year high. Follow-on offerings totaled USD270 billion, up 28% YoY, recording the strongest quarter since 2021. Convertible issuance reached USD129 billion, up 78% YoY and all-time high, accounting for 23% of total ECM activity. The technology, industrials, and energy & power sectors dominated convertible issuance, together representing approximately 69% of total convertible volumes in H1’26.
Top five M&A deals (H1’26)
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Date of announcement
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Acquirer’s Name
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Acquirer’s Location
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Target
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Target’s Location
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Value (USD billion)
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Target’s Industry
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Deal type
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|---|---|---|---|---|---|---|---|
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Feb 2, 2026
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SpaceX
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US
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X.AI Corp.
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US
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250.0
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Tech
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Stock
|
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May 18, 2026
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NextEra Energy
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US
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Dominion Energy
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US
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67.0
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Energy & Utilities
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Stock
|
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Jun 16, 2026
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SpaceX
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US
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Anysphere (Cursor)
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US
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60.0
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Software
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Stock
|
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May 3, 2026
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GameStop
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US
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eBay
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US
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58.3
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Internet Retail
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Cash & Stock
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Feb 23, 2026
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Advent Internation / Stripe Inc
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US
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PayPal
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US
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55.7
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FinTech
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Cash
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Investment banking revenues rebound as market conditions improved
In H1'26, investment banking revenues rebounded across major global banks, driven by improving capital markets activity, stronger corporate earnings and increased client engagement. Equity capital markets emerged as the key growth driver, supported by a resurgence in IPOs, follow-on offerings and financing activity, while advisory revenues benefited from higher M&A deal completions. Looking ahead, investment banking activity is expected to remain supported by healthy pipelines and sustained transaction demand, although macroeconomic, geopolitical and tariff-related uncertainties remain.
Note: Revenues for Deutsche and Barclays were converted into USD using the exchange rate as of June 30, 2026
Revenue for Deutsche Bank reflects revenue from Investment Banking & Capital Markets
Bulge bracket investment banks – H1’26 highlights
JPMorgan’s investment banking fees increased 30% YoY in Q2’26, driven by higher fee generation across all products, with equity underwriting delivering particularly strong growth. Advisory fees rose 20% YoY, while equity underwriting fees surged 78% YoY and debt underwriting fees increased 19% YoY during the quarter. Management noted that the investment banking pipeline remains robust, and current market activity levels are encouraging greater client engagement and transaction activity. The bank also maintained its #1 position in Global Investment Banking fees, capturing a 9.3% wallet share in H1’26. |
Goldman Sachs’ investment banking fees increased by 52% YoY in H1’26, primarily due to significantly higher net revenues in equity and debt underwriting fees. Advisory net revenues were up by 46% YoY in H1’26, driven by an increase in industry-wide completed M&A volumes. Equity underwriting net revenues increased by 90% YoY, primarily from secondary and initial public offerings, and Debt underwriting net revenues increased by 37% YoY, primarily from an increase in leveraged finance and asset-backed activity. Investment banking fees backlog increased QoQ in Q2’26, driven by an increase in advisory, partially offset by a significant decrease in debt underwriting. The bank is optimistic about the outlook for H2’26 as strategic dialogue remains robust.
Morgan Stanley’s investment banking revenues increased 58% YoY in Q2’26, reflecting strong performance across M&A advisory, equity underwriting, and debt underwriting. Advisory revenues rose 57% YoY, driven by a higher volume of completed M&A transactions, particularly in the Americas. Equity underwriting revenues increased 70% YoY, supported by stronger IPO, follow-on, and convertible issuance activity. Fixed income underwriting revenues grew 48% YoY, primarily benefiting from increased client capital-raising and strategic financing activity. Management highlighted that investment banking pipelines remain healthy, underpinned by broad-based client engagement across sectors and a continued build-up in activity globally.
Bank of America’s investment banking fees surged 35% YoY in H1’26, with strong growth across advisory and equity underwriting fees. This momentum was primarily driven by M&A activities, with equity and debt capital markets, that led to growth during the period. Advisory fees increased by 55% YoY and equity issuance fees increased by 48% YoY, whereas debt issuance fees increased by 18% YoY in H1’26. The firm’s investment banking pipeline remains strong in the near-term.
Citi’s investment banking fees increased 44% YoY in Q2’26, driven by strong growth in both equity capital markets (ECM) and debt capital markets (DCM), partly offset by a modest decline in M&A advisory revenues. ECM fees surged 92% YoY, supported by exceptionally strong market conditions and broad-based growth across products, particularly in IPOs and follow-on offerings. Citi also participated in 8 of the top 10 ECM deals during the quarter. DCM fees increased 65% YoY, driven by robust activity across both leveraged finance and investment-grade issuance. Advisory fees declined 4% YoY in Q2’26; however, the bank highlighted a healthy advisory pipeline heading into H2’26.
Deutsche Bank’s investment banking & capital markets (IBCM) revenues increased 36% YoY in Q2’26, driven by strong performance in both advisory and equity origination, in a growing industry fee pool. Advisory revenues rose 24% YoY, while equity origination and debt origination revenues increased 148% YoY and 20% YoY, respectively, during the quarter. The bank expects IBCM revenues to be significantly higher in FY’26, supported by investments made in prior periods as well as ongoing strategic investments. Debt origination is expected to benefit from lower mark-downs in 2026 and continued strengthening in the investment-grade debt market.
Barclays’ investment banking (IB) fee income increased 32% YoY in Q2’26, primarily driven by strong growth in advisory and equity capital markets (ECM). Advisory fees rose 53% YoY, reflecting increased client activity and stronger deal execution. ECM fees surged 94% YoY, supported by bank’s participation in 9 of the 10 largest global deals during the quarter. Debt capital markets (DCM) fees grew 10% YoY, driven by robust investment-grade issuance, partially offset by weaker leveraged finance activity. Looking ahead, the bank expects continued momentum, supported by a strong IPO pipeline for H2’26 and a healthy M&A pipeline, with the proportion of announced deal volumes expected to complete in FY’26 increasing YoY.
M&A advisory firms – H1’26 highlights
Like the major investment banks, leading advisory firms reported a rebound in revenues in H1'26, supported by stronger strategic M&A activity and improved deal completions. While firms continue to highlight risks from geopolitical tensions, macroeconomic uncertainty, and market volatility, management commentary remained broadly constructive. Earnings across leading advisory boutiques reflected renewed momentum in large and mid‑cap strategic M&A, with pipelines strengthening and mandating activity accelerating, particularly in sectors such as energy, healthcare, technology, and financial sponsors. Looking ahead in 2026, these firms expect improved access to debt capital to support higher deal execution. However, uncertainty surrounding tariffs and shifting trade policies remains a key risk.
Note: Houlihan Lokey’s fiscal year ends in March (represents numbers for the three months ending June 26).
M&A advisory firms – FY’25 highlights
PJT’s advisory revenue rose 24% YoY in H1’26, primarily due to growth in strategic advisory, private capital solutions, and restructuring revenue. The firm’s full-year outlook remains largely unchanged, with expectations for a significant increase in strategic advisory revenue in FY’26. It anticipates strong growth in its strategic advisory division, with projections to surpass 2025 levels The firm’s M&A backlog continues to build with mandate counts at record levels, up more than 20% YoY in Q2’26.
Moelis’ revenue increased 9% YoY in H1’26, primarily driven by higher average fees earned per completed transaction. Growth was led by strong performance in capital markets and private capital advisory, partially offset by lower revenue from capital structure advisory. The firm’s announced transaction pipeline grew 80% YoY in Q2’26, while new business origination accelerated during the quarter, reflecting improving client activity and supporting a positive outlook for the remainder of FY’26.
Evercore’s advisory fees increased 61% YoY in H1’26, driven by higher revenue from large transactions and a greater number of advisory fee engagements. Underwriting fees rose 76% YoY during the same period, reflecting increased participation in capital markets transactions, particularly strong IPO and follow-on issuance activity. M&A activity continues to be led by large-cap strategic transactions, while middle-market and sponsor-backed deal activity remains relatively subdued. Despite these mixed market conditions, the firm’s advisory backlog remains near record levels, supporting a strong outlook for future revenue growth.
Lazard’s financial advisory revenue declined 9% YoY in Q2’26, primarily due to lower M&A deal completions in North America. Despite ongoing geopolitical uncertainty, the business continued to perform well across Europe and the Middle East. While overall M&A activity remained healthy, it was largely driven by strategic transactions, with private equity-related M&A activity continuing to lag. Encouragingly, the firm’s weighted backlog for FY2026 is building at a faster pace than in the prior year, supporting a positive outlook for future revenue generation.
Houlihan Lokey’s revenue declined 16% YoY in Q1’26, primarily driven by lower average transaction fees on completed deals. The decline reflects continued headwinds in the corporate finance business, including geopolitical instability in the Middle East and ongoing disruption within the technology and software sectors. Middle-market M&A activity remains subdued, particularly in Europe, although large-cap deal activity has shown greater resilience. Despite these challenges, the firm reported record levels of backlog, pipeline, and new mandate activity, providing a strong foundation for future revenue growth.
PWP’s revenue declined 17% YoY in H1’26, primarily due to fewer large fee-generating transaction closings and a corresponding decline in average fees per client. While M&A revenue increased compared with the prior year period, contributions from financing and capital solutions were lower, as H1’25 benefited from several sizable fee events. Despite the softer revenue performance, the firm’s outlook remains constructive, with booked, announced, and pending backlog increasing more than 30% YoY, while announced and pending backlog alone nearly two-and-a-half times the prior-year level, indicating strong future revenue potential.
The road ahead
AI as a structural force is reshaping M&A
AI is rapidly driving strategic shifts across industries, accelerating decisions around scale, capabilities, data access and talent, while fundamentally influencing both deal strategy and execution. Capital is flowing heavily into AI‑related infrastructure such as data centers, power generation and energy networks, alongside investments in technology development and customization. In the near term, the sheer magnitude of this multi‑trillion‑dollar investment cycle may absorb capital that might otherwise be deployed toward acquisitions, temporarily moderating M&A activity. Also, AI is accelerating convergence across sectors, eroding traditional industry boundaries - for instance, technology firms are moving directly into energy and power assets, while industrial and healthcare players are acquiring data, analytics and software capabilities to embed AI throughout operations and research and development.
Regulatory and policy uncertainty adds friction to large‑scale M&A
Shifts in regulation and public policy continue to inject uncertainty into the deal environment. Ongoing antitrust enforcement poses challenges for large-scale transactions, making regulatory approvals more complex and outcomes and timelines harder to predict. At the same time, evolving legal and regulatory requirements spanning data protection, cybersecurity and environmental, social and governance considerations are intensifying scrutiny across the M&A lifecycle. These developments are materially influencing how transactions are structured, assessed and executed. In parallel, increasing use of foreign investment controls, national security reviews and sanctions regimes is adding further complexity, often slowing deal processes and increasing execution risk.
Megadeals are driving a top‑down recovery in global M&A
Global deal values continued to strengthen into 2026 following the recovery that began in 2025, largely fueled by a revival in megadeals, even as transaction volumes across the wider market showed limited growth. This widening gap between value and volume highlights the development of a K-shaped M&A environment, where well-capitalized buyers are executing large, strategic transactions while much of the market continues to be held back by valuation mismatches, execution complexity and residual uncertainty. While large deals continue to account for a significant share of global M&A value, broader market activity is expected to strengthen as valuation gaps narrow, financing conditions improve, and capital deployment opportunities increase. The sustained presence of megadeals reflects continued confidence in strategic transactions and supports momentum across global M&A markets.
Improving capital markets support deal activity
Public markets have continued to strengthen, improving valuation visibility, price discovery and investor confidence across the deal environment. While IPO activity remains selective and concentrated in companies aligned with attractive growth themes such as AI infrastructure, healthier equity markets are expanding financing and exit options for both corporates and private equity sponsors. Improved capital market conditions are expected to support transaction activity; facilitate portfolio company exits and provide additional flexibility for strategic and financial buyers pursuing M&A opportunities.
Private markets emerge as the primary engine of M&A activity
In 2026, private capital became a core driver of global M&A, reflecting the exceptional scale of resources controlled by private equity and other private market investors, alongside their dual imperative to deploy capital and exit seasoned investments. Elevated levels of dry powder and extended holding periods are pushing sponsors toward larger and more intricate transactions, including sponsor‑to‑sponsor sales and complex take‑private structures. As a result, deal execution is evolving, with greater reliance on tailored financing arrangements and innovative capital solutions to overcome valuation mismatches and enable transformational deals. This has firmly positioned private markets as a leading source of deal flow, structural complexity and innovation in the current M&A cycle.
Shareholder activism emerges as a direct force shaping M&A decisions
Public shareholder activism is gaining momentum in 2026, with campaigns becoming more numerous and assertive, and activity nearing levels not seen in five years as market conditions increasingly support intervention. Activists are placing greater emphasis on transaction‑led outcomes, advocating for breakups, asset sales, full sale processes or transformative acquisitions as a means to unlock value and sharpen corporate strategy. More stable valuations, abundant capital across public and private markets and greater confidence in deal execution have enhanced activists’ credibility and influence, elevating activism from a peripheral governance consideration to a more direct and powerful force shaping corporate M&A decision‑making.
Geopolitical risk drives strategic M&A and supply‑chain reconfiguration
Geopolitical uncertainty and trade friction remain an important consideration for dealmakers, particularly in sectors exposed to global supply chains. Continuing conflict in Ukraine, the unsettled Middle East, trade tensions, tariffs and most recently, US actions in Venezuela are affecting not only political sentiment but also global trade and commodity markets. At the same time, rising defense and security budgets across the US, Europe and parts of Asia are reshaping capital allocation priorities, with implications for industrial supply chains, technology investment and M&A activity in defense-adjacent sectors. More broadly, geopolitics is increasingly acting as a catalyst for strategic M&A as companies reassess supply chains to improve resilience, reduce dependency risks and support localization or nearshoring strategies. These shifts are driving transactions focused on regional manufacturing, logistics, infrastructure and critical input as businesses prioritize supply security alongside cost and efficiency.
