The US initial public offering (IPO) market was the busiest it has ever been since 2021, as six big deals raised more than $4 billion over the week.
This surge in activity is a welcome change of pace after a slowdown earlier in the year due to market volatility influenced by Trump’s tariff policies. The week’s success is also proof of renewed investor appetite for tech, fintech, and crypto-related listings.
Klarna, Figure, and Gemini led the charge
Some of the notable IPOs involved Klarna, Figure, Gemini, Legence, Black Rock Coffee Bar, and Via Transportation. Among the newcomers are significant players in various sectors, showcasing a diverse range of industries entering the public market.
The lineup was much broader than expected, spanning industries and testing the waters for a potential fall IPO boom.
Among the six IPOs, five were worth at least $290 million, priced above their marketed ranges. However, their performances post-listing have not been as positive. Nevertheless, Wall Street analysts have called this a sign of healthy skepticism among investors, which they say bodes well for the market going forward.
Klarna has since inched toward its offering price, while Figure Technology Solutions Inc. ended its second day of trading near a high hit in the opening minutes of its debut.
Among the four listings from Friday, Gemini Space Station Inc. has soared, while Blackstone-backed Legence Corp. and Via Transportation Inc. have been left with at best modest gains after opening below their IPO prices.
This week’s set of deals is being considered as a gauge for how active the stock market is getting, and the results are mixed.
All the IPOs witnessed strong demand in the formal marketing process before trading began, with many selling bigger stakes than they had initially offered. Despite rough starts, analysts claim things have been smooth compared to ailing deals from earlier this year that continue to struggle underwater.
Experts expect the relative calm to entice more companies to go public, even though investors are still somewhat choosy over valuations and earnings.
“Investor expectations remain high and continue to be demanding — profitability and fundamentals are huge,” said Mike Bellin, who leads PricewaterhouseCoopers’ IPO practice. “Some companies were very conservative with their prices because we’re still in an uncertain market.”
Next week is expected to be equally active as Stubhub Holdings Inc., Netskope Inc., and others plan to go public. The group could raise up to $2.53 billion combined, and that would mark the first back-to-back weeks of such volumes in US IPOs that do not include SPACs, REITs, and closed-end funds since December 2021.
The week’s activity is not permanent, analysts warn
The US IPO market has had a strong start this month, but even with the welcome activity, the IPO market is still in recovery compared to pre-pandemic levels. There are those who don’t see the renewed activity as permanent either.
Kati Penney, the corporate transactions lead at CrossCountry Consulting, is one of those who expect the market to dial back. She has tagged the week’s activity as an “anomaly” that can be linked to a return of large, well-known names whose processes were paused due to market volatility related to President Donald Trump’s chaotic tariff policies in April.
The chaos kept several late-stage startups sidelined for months as investor demand for new deals soured.
“We’ll see steady momentum but not at the pace of these past two weeks,” Penney said in an interview. “It also seems to be a bit more concentrated in some of these industries around technology — crypto, AI.”
That was confirmed in the past week as the week’s largest deals came from Klarna and Figure, where both had investor orders for roughly 25 times more stock than was sold, according to Bloomberg News.
