U.S. CEOs Sustain AI Investments and Pursue M&A Amidst Subdued Confidence in Growth Prospects of U.S. and Global Economy

Walsh: “The deal market has been heating up, and we’re seeing that momentum reflected in our own business as we help corporates and PE prepare to buy and sell assets. For years, we’ve seen an appetite for M&A, but the conditions were challenging, especially in the middle market, limiting activity to bigger players. While the conditions still aren’t ideal given persistent uncertainty, middle market companies are eager to make moves joining larger firms in making deals.”

• 63% of CEOs say their organization will seriously pursue new deal making in 2026. 25% say they are waiting until 2027.
• Over half of CEOs (52%) feel there is sufficient certainty in the market to make significant investment decisions. 28% do not feel there is sufficient certainty in the market, but it is not holding them back; 20% do not feel there is sufficient certainty, and it is affecting their ability to make significant investment decisions.

Walsh: “Policy uncertainty is the baseline, and agility is the only way to stay ahead of it. CEOs are keenly aware that their customers are price sensitive right now. Leading companies are not just re-examining their supply chains. They are investing in technology and AI to gain every edge.” 

• 48% said their organizations are actively modeling and deploying tariff mitigation strategies, and 41% said their companies are deploying AI to manage and optimize trade compliance.
• In the past year, 71% made strategic adjustments to foster greater agility (supply chain optimization, tech/AI, scenario planning, etc.).
• Over the next year, 43% plan to increase investment in bolstering supply chain agility (nearshoring, offshoring, supplier diversification).

Walsh: “It feels like every time you get used to the progress of AI, there’s another breakthrough that widens your aperture to what’s possible. CEOs may worry a bit about the strength of the economy or whether there is a so-called AI bubble, but they don’t view AI investments as discretionary – it’s a required investment. However, while AI use is high, AI-driven value is lagging. Realizing truly transformative value from AI requires embedding its use into new business models and ways of working to disrupt markets and gain share.” 

• When asked about the allocation of their organization’s 2026 capital budget for AI initiatives, 37% indicated 5-10% of expenditure, 35% reported 11-20% and 6% of CEOs said 21-30%.
• When it comes to AI, CEOs are focusing their investments on upskilling their workforce (61%), accelerating their rate of innovation (53%) and embedding AI into their operations and everyday workflows (52%).
• 64% indicated the returns and value from their organization’s GenAI investments to date are at expectations.
• When asked how their organization’s ROI metrics have evolved over the past 12 months, 57% said they adapted existing metrics to better capture AI value.
• One in four CEOs believe there is an AI investment bubble but have adapted their approach or don’t see it affecting their commitment to AI.

Walsh: “Scaling AI brings tremendous opportunity – but it also raises the stakes on risk. With AI-driven threats and emerging technologies like quantum computing, cyber risk is front and center for boards and executives. Companies that innovate responsibly, with strong ethics and governance, can convert that risk into trust – and trust into long-term advantage.”

• When it comes to cyber risk specifically, CEOs are concerned about data and privacy risks associated with the deployment of AI agents (91%), AI-assisted malware attacks (91%), AI-assisted phishing attacks (89%) and AI agent insider threats (80%).
• 58% are concerned about quantum computing attacks against encryption.
• 36% are concerned they will not have the ability to hire the cybersecurity talent they need. To address these talent gaps, CEOs said their organizations plan to upskill existing employees (58%) and hire new talent (19%), engage managed services to outsource expertise (14%) and deploy AI agents and automation (8%).

Walsh: “CEOs are very much grappling with how AI will change their workforce. The must-dos are clear: compete for AI talent, embed agents into teams and upskill their current employees. However, a concrete vision for their future state remains elusive, which also creates tension with employees who are asking similar questions about AI’s impact on their career over the long-term.” 

• When asked if they have a clear plan for how AI will change existing roles in their organization, 67% said they have an initial perspective but have not yet redefined roles or career paths and 29% said they have well-defined roles and career paths that account for AI.
• More than one-in-five CEOs expect workforce reductions in targeted areas over the next year with 9% (or slightly less than half) attributing that to AI.
• More broadly, as a direct result of AI, 55% expect to increase hiring over the next year; 36% expect no change. However, 61% are concerned they will not have the ability to hire the technical AI talent they need. To address these talent gaps, CEOs said their organizations plan to upskill existing employees (46%) and hire new talent (34%).
• When asked about the extent to which their organization was preparing managers to supervise and collaborate with agentic AI tools and autonomous systems, 44% said they were piloting programs or initiatives to upskill managers on AI oversight. 24% said they were providing guidance and best practices, but no formal programs exist.
• When asked about their primary concern about AI’s impact on leadership development, CEOs most frequently cited reduced opportunities for early-career employees to build judgment through experience (31%), over-reliance on AI for decision-making thus limiting critical thinking (30%) and less exposure to ambiguity, failure and learning through trial and error (22%).