Wall Street bankers are on a high after record-setting offerings from SpaceX and Google parent Alphabet Inc., lifting expectations for deal activity in the rest of 2026.
US IPOs and share sales totaled a record $251 billion through June 26 this year, excluding blank-check companies and other investment vehicles, data compiled by Bloomberg show. That tops the high watermark for a half set during 2021’s issuance mania, according to the data.
More deals are on the way, including a steady stream of initial public offerings in the coming weeks, and a potential mega-deal for Anthropic PBC as soon as October. Momentum in other forms of fundraising such as convertible debt is also expected to continue, as so-called artificial intelligence hyperscalers keep tapping investors to fund the data centers and other infrastructure supporting the tech boom.
SpaceX’s $86.2 billion listing broke the record for the biggest IPO ever. Still, it’s not the whole story.
“Even if you take out SpaceX’s IPO, volumes are advancing rapidly,” according to Will Connolly, co-head of equity capital markets in the Americas at Goldman Sachs Group Inc., the lead left bank on the cover of SpaceX’s IPO prospectus.
Connolly sees a paradigm shift in capital markets whereby the need for equity capital to fund AI infrastructure is so far being matched by resilient stock prices and investors’ strong willingness to fund the plans.
“There’s a lot of activity across the ecosystem and across different products,” Connolly said in an interview. “It’s really the first time you could say that since 2021.”
While AI optimism is a key factor propelling activity today, including the reason behind the year’s biggest equity deal that isn’t an IPO — Alphabet’s $85 billion fundraise — pessimism about the outlook for the latter months of the year could accelerate the pace of offerings.
Wall Street is keeping a wary eye on expectations for the Federal Reserve’s next move, with interest rate cuts off the table for the year as traders brace for a potential rate hike over the coming months. The unease around the Fed, along with voters heading to elect a new congress in November, is set to define the timetable.
“It’s likely that activity will continue at a high pace over the summer so we’re preparing for a busy Q3,” said Arnaud Blanchard, co-head of global ECM at Morgan Stanley, which was also a lead bank on SpaceX’s offering.
“While Q4 is typically a constructive window, we could see some volatility around the midterm elections and so second half activity is likely to be front-loaded into Q3.”
Strong Performance
Blockbuster deals like SpaceX have helped drive strong performance for newly-public companies, despite the volatility in the Elon Musk-led firm, which remains well above its IPO price.
Investors have flocked to debuts by companies seen as benefiting from the trillions of dollars in AI spending, with the weighted-average return for newly-listed US companies excluding SPACs nearing 16%, data compiled by Bloomberg show. That’s almost double the return for the S&P 500 Index this year.
Large offerings are in vogue. SpaceX’s debut was just one of 11 US IPOs to raise more than $1 billion far this year, the data show. That number could be matched in the final six months of the year, according to JPMorgan Chase & Co.’s global head of private capital advisory and solutions Keith Canton.
“There could be another dozen jumbo IPOs — think $1 billion-plus — in the second half,” he said. Canton expects a pickup in activity for firms backed by financial sponsors such as private equity.
“Some of their companies are very high quality and very large, so they may have outgrown M&A as an option, so I’d expect to see some of them start to come to the public market.”
Private equity has several large candidates in the pipeline, after being relatively absent from the ranks of the biggest IPOs in recent years. Csquare Inc., a data center company backed by Brookfield Corp., can begin formally marketing its offering in the coming days, tapping into the AI theme.
Though certain tech stories have captivated investors, bankers say there’s plenty of room for deals that offer solid value.
AI chipmaker Cerebras Systems Inc. pulled off a $6.38 billion IPO in May, after a feverish marketing period that saw the company price its shares well above a range that had already been raised.
“For every Cerebras out there are four or five assets in PE that are more traditional IPO stories,” said John Kolz, global head of equity capital markets at Barclays Plc. “So the discussion centers around the appropriate valuation, leverage and size judgments for a successful IPO.”
A successful IPO doesn’t guarantee long-term returns. Cerebras’ shares have surrendered their gains over the past month, and the stock is hovering around its IPO price.
Private equity-backed names outside the tech universe include Roark Capital-owned Inspire Brands Inc. and Jersey Mike’s Subs, the sandwich chain backed by Blackstone Inc. Both have filed confidentially for IPOs and are seen among the companies that could go public in the coming months.
Many are hoping investors’ enthusiasm finally spreads beyond AI-related plays, ending a drought for buyout firms that have been unable to exit their portfolio companies and return capital to investors.
“In the past years, a lot of us have expected the IPO market to reopen with sponsor-driven activity, but it’s been more driven by the capital needs associated with AI, or sponsor businesses tied to those thematics,” said Eddie Molloy, co-head of global equity capital markets at Morgan Stanley. “It does leave some deals in a holding pattern.”
Jitters affecting AI-related stocks last week, stoked in part by news that OpenAI’s IPO plans have shifted into 2027, could derail plans if they continue to spread.
For now, with South Korean memory chipmaker SK Hynix Inc.’s planned $29 billion US listing set to jump-start the new quarter, investors will likely have no shortage of opportunities to keep doubling down.
Lisa Clyde, co-head of global capital markets at Bank of America Corp., had one word for the onslaught of IPOs: “Epic.”
“This will be the year everybody talks about for the foreseeable future.”
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