The IPO market in 2025 is showing tangible signs of recovery, with 105 IPOs priced as of July 11. This represents a +50.0% increase compared to the same period in 2024. After years of post-pandemic volatility, investors and issuers alike are re-entering the public markets with renewed caution, yet growing confidence. But does this signal a full-fledged rebound, or merely a technical bounce? In this report, we examine historical data, key drivers, sectoral shifts, and the forward-looking landscape for IPOs.
A Decade of Volatility: From Record Highs to Record Lows
Between 2016 and 2021, IPO activity in the U.S. steadily climbed, peaking at 397 IPOs in 2021, according to Renaissance Capital. That year was fueled by ultra-low interest rates, strong equity markets, and a surge in tech listings, including SPACs and high-growth unicorns.
However, the bubble deflated quickly. In 2022, the number of priced IPOs fell to just 71, a staggering decline of over 80% from the prior year. While 2023 brought a slight recovery with 109 offerings, and 2024 saw further improvement to 150 IPOs, the market was still operating below its long-term average.
The current pace in 2025, with 105 IPOs already priced mid-year, indicates that this year could surpass 2024’s full-year total. If the current trend holds, we may see 155 to 195 IPOs by year-end.
Tailwinds Driving the 2025 IPO Recovery
Several macroeconomic and industry-specific factors are contributing to this year’s improved IPO climate. First and foremost, expectations of monetary policy easing have restored market appetite. With the Federal Reserve signaling a shift toward neutral or dovish interest rate policy, capital markets have responded positively.
At the same time, valuations have corrected from pandemic-era excesses. Private companies that postponed IPOs in 2022–2023 due to unfavorable conditions are now seeing more rational pricing windows. This is supported by data from EY, which reports that IPO proceeds in Q1 2025 reached $8.9 billion, reflecting a 55% year-over-year increase.
Furthermore, equity markets are delivering strong year-to-date performance, especially in the tech-heavy Nasdaq, boosting investor sentiment and deal execution capacity.
Thematic Focus: AI, Cybersecurity, and Biotech
In terms of sectors, the IPO pipeline is dominated by technology-related names, especially companies aligned with artificial intelligence, data infrastructure, and cybersecurity. Noteworthy listings like Circle, Chime, and Databricks are expected to attract significant institutional capital in the second half of the year.
Biotech is also seeing renewed interest after two relatively weak years. Regulatory clarity and capital inflows from strategic investors have reinvigorated clinical-stage companies aiming to list before year-end.
Global Activity: The U.S. Leads, but Asia and Europe Follow
While the U.S. remains the largest IPO market, activity is also increasing globally. A recent White & Case analysis indicates that global IPO volume rose by 20% in Q1 2025 compared to the previous year, driven by offerings in India, Japan, and the United Kingdom.
However, geopolitical risks remain a significant headwind. The lingering effects of U.S.-China trade tensions, upcoming elections in major economies, and regulatory shifts are creating an unpredictable backdrop for global equity markets.
Investor Caution Remains: Volatility and Underperformance Post-IPO
Despite growing volumes, investors remain wary. Many 2024 and early 2025 IPOs experienced significant post-listing volatility, with several trading below their offer prices within weeks of listing. This has led to increased scrutiny on fundamentals and profitability metrics.
Moreover, regulatory developments in the U.S., including expanded disclosure requirements and tighter audit controls for foreign issuers, may limit the number of listings from specific regions or sectors.
As noted in a Financial Times report, post-IPO performance remains mixed, reinforcing the need for thorough due diligence and disciplined allocation strategies among asset managers.
What to Expect in H2 2025
Looking ahead, market analysts anticipate a busy second half, especially in Q3, traditionally one of the most active IPO windows. If macroeconomic conditions remain stable, and if major indices maintain momentum, the U.S. could close the year with up to 195 IPOs — the strongest showing since 2021.
However, issuers will need to differentiate themselves clearly. Investors are now focused not only on revenue growth, but also on margin sustainability, capital efficiency, and corporate governance standards.
Conclusion: A Market in Transition
The IPO landscape in 2025 represents a critical inflection point. After the deep freeze of 2022 and the slow thaw in 2023–2024, the market is finally beginning to regain balance. While the exuberance of 2021 is unlikely to return soon, a more rational, fundamentals-driven IPO environment is emerging.
For issuers, this means opportunity — but only if backed by performance, transparency, and long-term vision. For investors, 2025 offers a chance to participate in high-potential listings, with the caveat that careful analysis will be more important than ever.
