Global M&A stays strong into 2026 as AI mega-deals outpace funding

MarketMoodz Analysis

Investors should view the 2025 M&A surge as confirmation that the deal engine remains intact even as traditional discretionary capital tightens. AI-driven demand is helping fuel megadeals, while private capital—private equity, private credit, and sovereign funds—plays an outsized role in funding, skewing transaction structures toward strategic scalability and accelerated integration.

Historically, the 2021 peak of $5.6 trillion looms as a ceiling for annual deal value, making 2025's near-peak level a sign of durability rather than an outlier. The notable shift away from equity-heavy financing toward dividends, buybacks, capex, and R&D suggests a pullback in M&A as a capital-allocation preference, even as deal activity remains robust. Watch for the evolving balance between public market funding and private capital, plus how AI-enabled demand affects sector concentration and valuation discipline.

Looking ahead to 2026, the signals are mixed but cautiously constructive: 80% of 300 M&A executives expect to sustain or increase activity, while 57% of 600 corporate/financial sponsor clients say scale and strategic growth will drive deal decisions. If private credit widens its role and AI-driven capex remains strong, execution risk shrinks for mega-deals but capital-structure risk may rise as buyers juggle returns with integration costs.