After slumbering for three years, the U.S. IPO market awakened in 2025, with more companies going public and several IPO stocks soaring from their initial offerings. AI-focused CoreWeave, one of the hottest new issues, has shot up 225% from its initial offering.
But after a flurry of IPOs in May and June, some analysts wonder if the bounce in new issues will hold through the second half of the year.
Following a superb 2021 that saw 397 companies make initial public offerings, the U.S. IPO market dried up in 2022 as a bear market choked off investor appetite. Only 71 companies went public that year. The market remained lukewarm in 2023 and 2024 with 109 and 150 IPOs, respectively. The government stimulus and low interest rates that helped boil the 2021 IPO market had diminished by then.
But so far this year, more than 100 companies have already gone public and raised a combined $15.6 billion. As of June 23, another 168 companies were in the U.S. IPO pipeline, with filings to raise $7 billion, according to IPO tracking firm Renaissance Capital. About 100 are considered "active" filings.
Figma, the digital marketing and media company that Adobe once tried to acquire, filed to go public on July 1. The company was valued at $12.5 billion last year.
Many companies placed their IPOs on ice in April, after the White House announced sweeping tariffs and stocks plummeted. But once most tariffs were suspended and stocks rallied back, companies dove back into the IPO market. In the second quarter, 15 initial offerings raised $100 million or more, mostly in the second half of the quarter.
Unicorns — IPOs with an initial market capitalization of more than $1 billion — saw a rousing comeback as cryptocurrency firm Circle Internet Group, fintech Chime Financial and adtech provider MNTN saw heavy first-day interest. Chime rallied 37% in its debut, although it has since pulled back from its peak of 44.94.
Circle shares are now up more than 500% from their IPO price. Among other highflying IPO stocks, Karman Space & Defense has more than doubled. Drone maker Airo Group and China-based biotech Ascentage also have more than doubled.
Circle's $1.1 billion offering was the largest in Q2, and the IPO stock had the best first-day pop for a billion-dollar IPO ever, Renaissance says. The other sizable deals also did well, with the 15 that topped $100 million averaging a stellar 65% return in the second quarter. Hinge Health, a telehealth platform for physical therapy, is up about 50% from its May 22 IPO.
IPO Stocks Back In Vogue
To be sure, a rising stock market offers a positive backdrop for initial offerings. No company wants to enter the public market facing a wave of sellers. But IPO investors can be fickle. Last year's 23.3% jump in the S&P 500 helped increase the number of IPOs by 39%, while fundings climbed 53%.
Yet 2024 was still below historical norms, Renaissance researchers say. The Renaissance IPO ETF lagged the S&P 500 last year with a 15.5% return.
Delayed rate cuts and periods of market volatility scared off companies. Also, some IPO companies suffered from bigger-than-expected losses, and drug-development problems plagued some biotechs.
One major reason for this year's improvement is a shifting landscape in valuations, analysts told IBD.
Investors and companies — seduced by elevated valuations in the 2021 IPO market — held out for the highest price possible. But now investors are coming to terms with the reality that they may have to accept less than they dreamed of.
More 'Down Rounds' In IPOs
This year, "down rounds" — in which IPO valuations thin out from earlier private funding — have been more common. Nearly every major listing so far in the second quarter had significantly lower valuations, Emily Zheng, a venture capital analyst at PitchBook, told IBD.
Chime had a $9.1 billion IPO valuation from a $25 billion peak valuation, Zheng said. Hinge Health went public at $2.3 billion vs. $6.2 billion at its peak. Circle was once valued at $7.7 billion and fell to $5.8 billion. MNTN saw its valuation cut nearly in half from a $2 billion peak to $1.1 billion at the IPO.
"I think that's going to be an increasingly more common theme as we're seeing more and more IPOs, because the lofty valuations ... are just unrealistic for a lot of companies to maintain," Zheng said. "And investors are making peace with that because it's either they get liquidity, or there are no exits."
IPO Valuations Soared In 2021
Matthew Kennedy, senior strategist at Renaissance Capital, also sees a shift in valuations.
"After the large funding rounds and inflated valuations of 2021, private companies broadly pushed back IPO plans over the past few years because they had plenty of capital and wanted to avoid taking a down round," Kennedy told IBD. "Now that's starting to change."
In a sign of how crazy valuations grew in 2021, only 17% of the stocks that debuted in that boom year were still above their IPO prices in June, he noted. This year, some 72% of IPOs are trading above their IPO prices.
Many companies also delayed IPOs the past couple of years because they didn't want to be the first ones to test the waters of a cool IPO market, Zheng added.
Once the first tests came out well, such as CoreWeave and Circle Group, a domino effect began in the IPO market that motivated others to go public, says Andrew Rocco, a stock strategist at Zacks.
Kennedy agrees.
"You kind of need to see multiple things moving in the right direction, and companies are really more willing to go public when they see a string of successes and they feel more confident and more comfortable that they'll be able to get the valuation they hope for," he said.
Trump And IPO Stocks
Government policy changes also are helping boost the IPO market, notably cryptocurrencies and defense technology.
President Donald Trump is easing oversight of crypto assets, Zheng said. The Genius Act, a bill that brings both oversight and legitimacy to stablecoins, passed a Senate vote in June and heads to the House for a possible final vote this coming week. The bill has heightened investor interest in stablecoins, which are digital tokens linked to a specific underlying asset.
It's no coincidence that the share price of Circle, the issuer of the USDC stablecoin, swelled more than 400% at one point from its IPO, she added.
On the defense front, Trump hopes to revitalize the domestic military industry. Wars in Ukraine and the Middle East have shown the importance of drones and electronic warfare. Drone maker Airo debuted June 13 at 10 a share and is now trading around 27.
Why Bother Going Public?
Another reason companies have eschewed IPOs is because they're getting plenty of liquidity from private investors, analysts said.
That's one reason major companies such as Stripe and SpaceX are opting to remain private, said Victor Basta, managing partner at Artis Partners, an investment bank advising tech companies.
Stripe, the financial tech company, announced in February another tender offer, a deal in which former and current employees will be able to cash out their holdings and sell to investors in a prearranged trade. The deal valued the company at $91.5 billion.
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A difficult market in Europe for new issues is driving interest in U.S. IPOs, Basta added.
"Put bluntly, European markets are far better supporting traditional businesses which can be valued on profitability rather than growth, and this has been the case for literally decades," he said. The U.S. provides more exit options for initial investors. The U.S. economy is performing better than the EU, and valuations for financings and M&A are higher for companies that can establish a meaningful presence in the U.S.
European scale-ups are relocating to the U.S. for those reasons, he added, and Basta expects the trend to accelerate.
Performance of IPO Stocks
While several IPO stocks have made impressive gains, many others have flopped. Using data from IBD MarketSurge, the average price gain for this year's IPOs from their initial pricing is more than 100%.
In some cases, the euphoria of the first day of trading becomes ephemeral. Newsmax, the conservative media company, went public at 10 a share March 31. After soaring to 265 the second day, it quickly came back down to earth. Today, it trades around 14 a share.
Abroad, the IPO market is performing better, thanks in large part to a hot Hong Kong market. The Renaissance International IPO ETF is up more than 24% year to date, well ahead of the Renaissance IPO ETF, which is up 2% and is a mix of U.S. and foreign stocks.
IPO Stock Investing
IPO stocks have an often positive place among investors' portfolios because they represent the new blood in equities.
For stock traders, IPO stocks represent lucrative opportunities, if they trade them correctly. Of 44 IPOs this year in IBD's database, a dozen have more than doubled. But another dozen are now trading below their initial public offering prices.
Buying shares the same day they go public is risky. But stocks breaking out of their first price patterns, namely the IPO base, historically offer solid and often quick profits.
A study of chart patterns of winning stocks conducted by IBD's Mike Webster found that the IPO base is the most successful, producing average gains of more than 14% in an eight-week period from their proper buy points. That's well above the average gain from other IBD-identified patterns such as the double bottom and cup with handle.
The Renaissance IPO ETF rebounded from a 35% February-April slide to close the second quarter with a 16% gain, beating the S&P 500's 6.7% return. The ETF is up more than 40% from its April 7 low and is trying to break out of a cup-with-handle base with a 44.09 buy point.
Pipeline For IPO Stocks
But for all the positive vibes in the IPO market, analysts say there's still no flood of new filings.
Although the July 9 tariff deadline passed without much trouble for IPO stocks, tariff uncertainty remains a weight.
Renaissance Capital data shows that despite a 41% increase in IPO pricings so far this year, total proceeds are down 7% to $15.5 billion. A relatively modest 41 companies submitted initial filings in the second quarter. Ten companies filed to raise at least $100 million, well below the two dozen who filed in the year-ago period.
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By sector, the IPO pipeline has 25 industrials, 20 techs and 16 consumer discretionary companies. The median deal size is just $10 million, with only a handful set to raise $100 million or more.
The biggest names that could IPO this year include Klarna, the Sweden-based "buy now, pay later" company, and ticket broker StubHub. Both have estimated deal sizes of $1 billion. In the week of June 23, publisher McGraw Hill and consumer research firm NIQ Global Intelligence filed for $1 billion IPOs.
Activity in private companies that Renaissance tracks indicates that many IPO candidates are still targeting 2025 listings. "That said, we do need to see more filing activity in the coming months to support a more robust pickup in the fall," the firm said in its Q2 roundup.
PitchBook's Zheng is skeptical about the IPO market's rebound. While there was a spike in recent listings, there hasn't necessarily been a rush toward new filings.
"So will this pace necessarily continue? It might be too early to tell," Zheng said. "As of what we know right now, we can't confidently say that there is a full rebound yet. But the IPO window is cracked open."
| 2025 IPO Leaders | ||||||||
|---|---|---|---|---|---|---|---|---|
| Some of the top names leading the year's rebounding IPO market | ||||||||
| Symbol | Name | Current Price | IPO Price | Price % Change | Comp Rating | Industry Name | ||
| CRCL | Circle Internet Group | 188.32 | 31 | 507% | 82 | Financial Svcs-Specialty | ||
| YB | Yuanbao ADR | 28.75 | 15 | 92% | 98 | Insurance-Diversified | ||
| AAPG | Ascentage Pharma ADR | 38.59 | 17.25 | 124% | 79 | Medical-Biomed/Biotech | ||
| HNGE | Hinge Health | 47.32 | 32 | 48% | 82 | Medical-Products | ||
| SION | Sionna Therapeutics | 20.3 | 18 | 13% | 60 | Medical-Biomed/Biotech | ||
| NPB | Northpointe Bancshares | 14.8 | 14.5 | 2% | 93 | Banks-Midwest | ||
| KRMN | Karman Holdings | 48.01 | 22 | 118% | 96 | Aerospace/Defense | ||
| AII | Amer Integrity Ins | 17.45 | 16 | 9% | 64 | Insurance-Prop/Cas/Titl | ||
| MTSR | Metsera | 37.75 | 18 | 110% | 59 | Medical-Biomed/Biotech | ||
| SFD | Smithfield Foods | 23.84 | 20 | 19% | 84 | Food-Meat Products | ||
| MNTN | MNTN | 22.43 | 16 | 40% | 16 | Comml Svcs-Advertising | ||
| CEPO | Cantor Equity Partners I | 11.86 | 10 | 19% | 55 | Finance-Blank Check | ||
| SMA | SmartStop Self REIT | 35.73 | 30 | 19% | 45 | Finance-Property REIT | ||
| CRWV | CoreWeave Cl A | 130 | 40 | 225% | 68 | Computer Sftwr-Enterprse | ||
| ETOR | eToro Group | 58.2 | 52 | 12% | 47 | Finance-Invest Bnk/Bkrs | ||
| AIRO | AIRO Group Holdings | 26.19 | 10 | 162% | 36 | Aerospace/Defense | ||
| CAEP | Cantor Eq Partners III | 10.53 | 10 | 5% | 22 | Finance-Blank Check | ||
| CAI | Caris Life Sciences | 26.49 | 21 | 26% | 25 | Medical-Research Eqp/Svc |
