IPO Revival Likely to Continue into Mid-2025 | U.S. Markets

After we launched the Nasdaq IPO Pulse a 12 months in the past, we mentioned it steered that U.S. “IPO activity… should remain in an uptrend” as we headed into 2024. 

Then, after we launched the Nasdaq Stockholm IPO Pulse in September, we wrote that it “suggests [Stockholm] IPO activity… is likely to remain in an uptrend in the coming months.”

And now, it seems to be like our IPO Pulses had been proper!

2024 was a 12 months of restoration for IPO exercise within the U.S. and Stockholm

Following the sooner upturns in our U.S. and Stockholm IPO Pulses, precise IPO exercise additionally recovered – in each the U.S. and Stockholm – in 2024.

In line with Nasdaq’s knowledge, the U.S. noticed 179 non-SPAC IPOs in 2024 – essentially the most since 2021, and a 40% increase over 2023 (127). By worth raised (ex SPACs), it was an even higher 12 months, with worth raised growing over 50% from 2023 to $30 billion – additionally essentially the most since 2021.

Plus, the 12 months ended sturdy, with This autumn having essentially the most non-SPAC IPOs in a quarter (53) in three years.

Sweden noticed a more than 60% leap in IPOs in 2024 (23) in comparison with 2023 (14 IPOs). Sweden additionally closed the 12 months sturdy, with This autumn having essentially the most IPOs in a quarter (10) in 2½ years.

U.S. led international IPOs, adopted by Asia, whereas some main markets lagged

Not solely did the U.S. have a sturdy 12 months for IPOs when in comparison with current years, but in addition when in comparison with the remaining of the world.

In line with FactSet knowledge (together with SPACs), the U.S. had over 250 IPOs in 2024. 

After the U.S., the checklist was dominated by Asian (and Rising) Markets, which took 12 of the highest 14 spots. 

European markets rounded out the highest 20 within the chart (Sweden took fifteenth place), however there are some main European economies lacking from this checklist, together with France and the Netherlands, which each fell outdoors the highest 20.

Chart 1: U.S. leads international IPO exercise in 2024, adopted by Asian markets

Since most international locations have very completely different sized economies and stock markets, it’s a little unfair to match international locations by a easy depend of IPOs. 

A “fairer” comparability is to have a look at the proportion increase in listings on account of IPOs in every nation. We show that within the gray circles. By that measure, 11 international locations – together with the U.S. (5%) – had been clustered within the 4%-6% vary. The clear winners in 2024 had been Macedonia (14%) and Saudi Arabia (12%). Whereas China, Australia and the U.Okay. scored the bottom.

Nasdaq IPO Pulse close to high, indicating continued uptrend in U.S. IPOs

Regardless that 2024 was the best 12 months for U.S. IPOs in three years, some commenters suppose 2025 might be an even higher 12 months. Proper now, the cyclical drivers of future IPO exercise captured by the Nasdaq IPO Pulse look fairly supportive. 

Whereas the IPO Pulse ticked down in December, it’s simply off October’s 3¼-year high, suggesting U.S. IPO exercise ought to stay in an uptrend into mid-year.

Chart 2: The Nasdaq IPO Pulse suggests IPO exercise will maintain up into mid-2025 

Nasdaq Stockholm IPO Pulse off its high, however not but signaling a downturn

For Stockholm, the IPO Pulse upturn has light, however is just not but on the level that it’s clearly indicating a downturn is forward.

The Nasdaq Stockholm IPO Pulse was in an unambiguous upturn by way of the primary half of 2024, reaching a 2½-year high in June (chart under, blue line). Since then, it’s come off that high, however it remained above October’s eight-month low in December.

Chart 3: The Stockholm IPO Pulse sees a continued upturn in IPO exercise into the spring 

Given this current softening, we will take a look at whether or not it’s actually signaling a downturn in IPO exercise by evaluating it to its previous downturns. That’s as a result of most of these previous downturns genuinely anticipated downtrends in IPO exercise, whereas a couple had been false alarms.

Fortuitously, based mostly on that comparability, this current slowing at present seems to be barely more much like historic false alarms, so the Stockholm IPO Pulse is not but conclusively indicating a directional shift in IPO exercise.

Meaning we must always anticipate Stockholm IPO exercise to remain in an uptrend for now, however our subsequent replace in April ought to help make clear whether or not a near-term downturn is probably going.

U.S. and Stockholm IPO Exercise prone to keep in uptrends into Q2 2025

2024 was a 12 months of restoration for IPO exercise within the U.S. and Stockholm. And based mostly on our IPO Pulses, IPO exercise seems to be prone to keep in an uptrend into mid-year – particularly within the U.S.

In fact, a lot can change over the course of a 12 months, so we’ll be updating our Nasdaq IPO Pulses every quarter to see if these uptrends will proceed past mid-year, or if a directional shift lies forward.