U.S. macroeconomic factors fuel interest in IPOs

A new EY report released on Thursday noted that initial public offerings resurfaced in the third quarter, driven by short-term clarity regarding tariffs and interest rates. The report also revealed that the momentum of IPOs is expected to continue into the next year.

According to the report, the U.S. led in terms of IPO proceeds, recording the best quarter since 2021. Dealogic data compiled by EY showed that companies going public raised roughly $48.2 billion in proceeds for the third quarter globally. 

U.S. macroeconomic factors fuel interest in IPOs

IPOs are back! Initial Public Offerings have surged an average of 35% on their first day of trading this year, the strongest performance since 2000 👀 pic.twitter.com/lOMQzFz5IY

— Barchart (@Barchart) August 26, 2025

IPO activity slowed down earlier in the year as uncertainty about U.S. trade policies and interest rates loomed. The EY report acknowledged that clarity emerged around U.S. tariffs, monetary policy eased widely, and central banks cut rates or recalibrated fiscal policy in the U.S., Europe, and China, resulting in investors warming up to new listings.

EY argued that there is less clarity in the long run around inflation targets, central bank independence, and global policy coordination. The British firm noted that investors are seeking companies that are resilient and innovative in the face of long-term structural uncertainty.

According to the report, investors find themselves in an unusual position, having more clarity about the short-term geopolitical and regulatory landscape than about the long-term outlook. EY also noted that strong post-public performance from companies that have recently launched IPOs fuels more investor confidence. The report revealed that regulatory changes in the U.S., and in some cases loosening policies, have made IPOs more attractive, especially for fast-growing companies. 

EY also found that countries are tailoring policies based on the types of firms they are keen to attract. The Securities and Exchange Commission made reforms last year in the U.S. to tighten regulations for Special Purpose Acquisition Companies (SPACs) to more closely resemble those of traditional IPOs. The initiative gave companies an alternative to going public.

According to EY, the U.S. remains the most attractive country for new listings. The firm added that China’s regulatory policies are appealing for advanced manufacturing firms and electric vehicle supply chains.

Companies have seen significant post-listing performance, including Swedish online-payments provider Klarna, whose valuation surged to more than $17 billion on the first day it completed its listing on the New York Stock Exchange in September. Chinese company Zijin Gold rose by 68% in its first day of trading, with its market capitalization hitting around $40 billion on the day.

High-growth tech and crypto firms have also had strong first-day performances, including stablecoin issuer Circle, space startup Firefly Aerospace, and crypto exchange Bullish, which have reinforced optimism that the IPO market is stabilizing.

Tech executives expect IPOs to surge this fall

The EY report revealed that China’s post-listing performance for private equity-backed firms between the first and third quarters of 2025 has been strong. An analysis by EY, based on data from Dealogic, PitchBook, and S&P Capital IQ, found that the prices on the first day of trading were more than double the initial common share prices.

“I believe that the strong sentiment for U.S. IPOs overall will continue for the remainder of 2025 and into 2026, in particular for growth-focused deals in technology and linked to the U.S. consumer.”

-Josef Schuster, CEO of IPOX.

Schuster argued that the fall stretch is traditionally one of the busiest periods for new listings, as markets shake off the summer lull and companies rush to bring offerings when investors return after Labor Day.

Analyst in the U.S. Tiger Securities, Bo Pei, expects more IPOs to come as long as the U.S. stock market stays strong, hovering near record highs. Nasdaq CEO Aden Friedman also stated earlier this year that IPOs are looking more robust for the second half of 2025, as more large private companies begin to accept the volatility to tap equity capital markets. Senior research analyst at IPO Boutique, Jeff Zell, said he expects the digital asset industry and AI-related companies to continue leading the IPO market this fall.

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