Q4’25 Pulse of Private Equity — U.S. and global investment trends
A KPMG quarterly analysis of global private equity activity
Overview
As we conclude the first year of our Pulse of Private Equity series, we not only reflect on the trends that shaped 2025 but also cast an eye toward the private equity (PE) landscape in the year ahead. To inform this outlook, we worked with Pitchbook to develop a 2026 Global Private Equity Forecast. This forecast leverages a hybrid analytical framework, combining comprehensive data analysis with key market forces and macroeconomic variables to project future growth scenarios. Our extensive analysis underpins our predictions for the global private equity market in 2026, revealing key insights into both the U.S. and global landscapes.
Looking at the U.S. market, PE investment proved exceptionally robust in 2025, reaching $1.1 trillion – nearly matching 2021’s peak and commanding half of global deal value. This strength, however, stemmed from increased selectivity, leading to fewer but larger, strategic deals and a surge in corporate carve-outs. Dry powder and private credit fueled value over volume. While exit values climbed impressively, fundraising slumped to a decade-low, consolidating within bigger funds. Optimism for 2026 points to increased exit volumes, though smaller funds may face continued challenges.
Globally, deal value surged to a four-year high of $2.1 trillion, emphasizing high-quality assets despite declining overall deal volumes. The Americas led, capturing over half of this capital, with technology, media, and telecom (TMT) attracting the most investment. Notably, infrastructure and transport were the only sectors to see deal volume growth, boosted significantly by AI infrastructure. Sovereign wealth funds also became notably more active across regions. Although exit values soared, global fundraising mirrored U.S. trends, hitting a nine-year low. The market enters 2026 with considerable momentum, anticipating a continuation of large deals and improving overall exit activity.
Dive into our thinking:
Q4 2025 Pulse of Private Equity report
Download PDFU.S. insights
1
PE investment in U.S. accounts for half of PE deal value globally
PE investment in the U.S. was very strong in 2025, accounting for $1.1 trillion dollars — the second highest level of PE investment ever — and close to 2021’s peak high of $1.3 trillion. While the level of investment was robust, the number of PE deals dropped considerably —from 9,054 deals in 2024 to 8,232 deals in 2025.
2
PE investors in the U.S. were very selective with their dealmaking in 2025
U.S. PE funding rose in 2024 despite fewer deals, reflecting investor selectivity. Focus was on larger, strategic deals, with financial discipline emphasizing debt resilience and pricing power. This trend continues into 2026, directing capital to high-conviction opportunities with robust margins and clear exit potential.
3
Value growth over volume growth helped by record dry powder and private capital
A combination of pent-up demand and a record level of dry powder helped drive PE investment during 2025. Private credit also continued to scale during the year, giving sponsors financial leverage to complete more complex transactions. These factors, combined with an improving financing environment and syndicated markets opening — helped spur higher value deals.
4
Carve-outs remain a big driver of PE deals activity as corporates reshape their portfolios
PE M&A activity saw robust carve-outs in 2025 as corporates actively reshaped portfolios, shedding non-core divisions, for greater focus and improved financial health. Stabilizing macroeconomic factors, including interest rates, and flexible private credit boosted deal confidence significantly. This strategic trend is expected to sustain strong carve-out activity through 2026.
5
PE fundraising remains soft, concentrated on larger funds
U.S. PE fundraising plummeted in 2025 to a decade-low ($278B). Limited Partners (LPs) consolidated relationships, prioritizing larger, multi-strategy funds offering consistent performance and diversified asset access. These funds, now behaving like broader asset managers (including credit, real estate), enable LPs to diversify through a single relationship.
6
Exit value reaches highest level since 2021 while exit volume plummets to more than decade low
PE exit value climbed markedly to $725.1B in 2025, but exit volume hit a concerning decade low. For 2026, substantial volume increases are anticipated from improving markets, capital return pressure, narrower valuation gaps, and an opening U.S. initial public offering (IPO) market for quality assets.
Trends to watch for in Q4’25
The 2026 PE market shows real momentum. High-quality deals, megadeals (infrastructure, energy for AI/transition), tech services, and healthcare will thrive, leading to more club deals. Fundraising remains subdued, focusing on top-tier funds. This concentration risks creating "zombie" funds as smaller and emerging managers struggle to raise capital and follow-on vehicles.
In 2025, we saw the release of essentially two years of pent-up demand. That’s led to clearer rate expectations, narrower valuation gaps, and a return of investor confidence…. Much of the capital being deployed is being accelerated by the large funds, and deals are focusing on high value, top of the market deals.
Donald Zambarano
U.S. Head of Private Equity, KPMG in the U.S.
Global insights
1
Global PE deal value rises to $2.1 trillion despite soft volume
PE investment globally rose from $1.8 trillion to a four-year high of $2.1 trillion in 2025 despite a decline in deal volume from 20,836 deals to 19,093. The contrast reflects how PE investors across regions prioritized large, high-quality deals over deal quantity throughout the year.
2
Americas sees over half of global PE funding in 2025, with the U.S. accounting for the majority
In 2025, the Americas led global PE investment with $1.2 trillion across 9,118 deals, nearing 2021's peak despite fewer deals. EMA ($729.8B) saw robust growth, and ASPAC ($144.8B) a slight rise. Significantly, investment flows remained strong across all regions, yet deal volumes consistently declined.
3
A number of jurisdictions attract large PE deals in Q4’25
In Q4 2025, the U.S. led with the largest PE deals, including Hologic ($18.3B) and Sealed Air ($10.3B) take-privates by Blackstone/TPG and Sealed Air, respectively. EMA saw major buyouts like BASF Coatings ($9B) by Carlyle/QIA, while ASPAC's biggest deal was BP Castrol ($6B) by Stonepeak. Onex/AIG’s $7B Convex Insurance deal also stood out.
4
TMT sector attracts largest share of PE funding, but infrastructure alone sees uptick in deal volume
In 2025, TMT ($654B) and Industrial Manufacturing ($327.5B) led PE investment by value, despite falling deal volumes. Infrastructure and Transport saw record increases in both volume and value ($154.2B), largely due to AI infrastructure. Energy ($276.4B) and Cleantech ($59.1B) also grew significantly, benefiting from broader AI ecosystem interest.
5
Global exit volume at five-year low despite four-year high in exit value
Global PE exit value hit a four-year high of $1.2 trillion in 2025 due to large, high-quality exits and increased median deal sizes (acquisitions, buyouts, IPOs). This was fueled by better markets, rates, and financing. However, exit volume dropped to a five-year low of 3,162, indicating a growing inventory of aging assets.
6
Global fundraising activity falls to nine-year low
Global PE fundraising reached a nine-year low ($407.6B) in 2025, with a fund count lowest in over a decade. Factors include $1.7 trillion dry powder, pressure to return capital, and a concentration on large firms. Renewal will follow increased exit activity and proven value but will take time to materialize.
7
Sovereign wealth funds increasingly participating in PE deals globally
Globally, sovereign wealth funds (SWFs) became much more active in private capital in 2025, supporting top PE deals. Historically passive, SWFs are now resembling typical private equity investors, engaging more actively in investments across all major regions and even undertaking direct deals. This signifies a notable shift in their investment strategy.
Trends to watch for in Q4’25
Heading into 2026, optimism surrounds rising PE exit volumes as the valuation gap shrinks. The U.S. IPO market, though selective, is now open for high-quality, proven assets. This will likely improve overall exit activity and strengthen investor confidence, potentially leading to increasing investments across the private equity landscape.
2026 is well-positioned to be a good year for the PE market globally. Our forecast shows total deal value growing across scenarios as PE investors continue to make very large deals at the top end of the market. Deal volume will likely remain soft to start the year … although the improving exit environment should help shake things out.
Gavin Geminder
Global Head of Private Equity, KPMG International
Explore more
Industry
Private Equity
An holistic approach to private equity firms and their portfolio companies
Insight
Value creation in private equity
How leading GPs are now tilting their models to becoming the next-gen ‘quant PE house’.
Insight
Optimizing private equity exits and enhancing business performance
An uncertain global environment means it has never been more important to start laying the foundations for exit earlier in the investment lifecycle.
Insight
KPMG Pulse of Private Equity — U.S. and global insights
A KPMG quarterly analysis of U.S. and global private equity activity.
Meet our team
