The IPO Market Is Heating Up. Here’s What Investors Should Be Watching

Key Takeaways

• The IPO market is heating up, with several high-profile listings showing big first-day pops.
• Investors have flocked to IPOs from AI and cryptocurrency companies such as CoreWeave and Circle Internet Group.
• Analysts are optimistic about a strong end to the year for new listings, which could include eagerly-awaited IPOs from Klarna and Canva.

The market for initial public offerings is heating up, thanks in large part to heavy demand for freshly minted stocks connected to artificial intelligence or cryptocurrencies. From Circle Internet Group CRCL, a stablecoin issuer, to AI infrastructure firm CoreWeave CRWV, to digital design tool Figma FIG, new technology firms have led the way. Figma surged 250% the day it listed, and CoreWeave is up more than 130% since its debut.

More broadly, the average return of IPOs in 2025 is 20%, according to data from Renaissance Capital. That’s roughly double the 10.7% return of the Morningstar US Market Index so far this year. The number of IPOs pricing this so far this year is also up 61% compared with this point in 2024, according to Renaissance. July saw 26 initial public offerings, more than any month since November of 2021.

“2025 isn’t just a rebound year for IPOs; it’s the year the market remembered how to dream big,” says Mike Bellin, IPO Services Leader at PwC US.

Why Are IPOs Gaining Steam?

Coming into 2025, expectations had been high for the IPO market. However, the IPO window largely closed during the spring amid a painful stock market pullback sparked by US President Donald Trump’s trade wars. However, this summer has seen a slew of blockbuster listings of new stocks. Analysts point to several factors behind the revival.

The first is that sentiment around the stock market has recovered after a spring swoon. Investors appear more confident about the outlook for stocks than they did earlier in the year, when the market whipsawed on a near-daily basis thanks to trade developments. At the same time, recession fears have eased. Against this backdrop, the overall market has pushed to fresh record highs, having more than recovered from its nearly 20% decline earlier this year.

Then there are industry-specific catalysts. Perhaps the clearest example is that investor appetite for AI investments (or any related technology exposure) continues to grow, helping drive demand for stocks like CoreWeave and Figma. “There’s a lot of excitement around the places where there’s a really strong growth story,” says Angelo Bochanis, an IPO data and index associate at Renaissance Capital.

When it comes to cryptocurrencies, investors are optimistic about a looser regulatory environment under the Trump administration. “A lot of crypto companies specifically are looking at this year and next year as the time to go public, because there is this concerted government effort to be more friendly to the space,” Bochanis says. The early success of Circle and Bullish BLSH is evidence of market enthusiasm for exposure to digital currencies.

Bochanis points out that it’s not just tech, even though that sector tends to dominate headlines. Potential new entrants like Black Rock Coffee Bar and Bob’s Discount Furniture are also generating buzz.

Meanwhile, analysts say that several sluggish years for IPOs mean there’s a backlog of mature private companies waiting for the right conditions in which to go public. These firms have strong balance sheets that can support a successful listing, even in a down market. They also are more likely to be profitable, which is “very different” compared with a few years ago, says Bellin of PwC.

One caveat: Those mature companies also have the luxury of waiting to list if conditions change. “They can wait many more years or even indefinitely for a listing, if that’s what they want,” says Bochanis of Renaissance.

First-Day Pops Show Investor Enthusiasm

One sign of demand for IPOs is how many stocks saw big price jumps after their listings. That has especially been the case for crypto, AI, and tech names. Figma surged 250% on its first day of trading, while shares of Circle climbed roughly the same amount in its first two days and 168% in its first day alone.

“There’s a lot of retail investor excitement around getting into some of these spaces, and we’ve seen that manifest in really unprecedented first day pops,” says Bochanis.

Some of those pops have been sustained, while for other firms, the excitement has fizzled. Figma is now trading at $73, down 33%, thanks to big losses in the tech sector in the weeks following its debut. That’s significantly below its peak of $143 per share. Chime is trading down 25% since its debut. CoreWeave, which disappointed on its first trading day in March, is now up 135%. Circle is up 62%, while Bullish is up 4%.

What’s Next for the IPO Market

Analysts overall are optimistic on the IPO market for the remainder of 2025. “The pace and the momentum that we have going into the end of the year, I think, is very strong,” says PwC’s Bellin. However, he emphasizes that risks remain, ranging from trade policy to inflation and monetary policy to geopolitical tension. A deterioration in market conditions or prolonged uncertainty could prompt some firms to think twice about their plans to go public.

More clarity on any front will support new listings. “If we get clarity around lot of those factors, I expect even more companies to come to market to consider an IPO,” Bellin says. IPOs are riskier products, and more certainty about the outlook removes some of that risk for investors.

Bochanis calls the outlook “encouraging.” Barring a shock or downturn, “we’re going to see significant IPO activity in the months going forward,” he says.

Top IPOs To Watch This Fall

Klarna

Buy now/pay later firm Klarna, founded in 2005 and based in Sweden, has been on the IPO shortlist for months. The firm filed for an IPO in May and is considering a listing as soon as September, Bloomberg reported last month.

Klarna is valued at $6.7 billion, according to PitchBook.

Gemini

The cryptocurrency exchange and custodian Gemini made headlines earlier this month when it officially filed for a public listing after confidentially filing in the spring.

“That’s a company that’s going to get a lot of attention right now, because investors are really, really hungry for ways to play the space,” Bochanis says. Kraken, another cryptocurrency exchange, is also on investor watchlists, but it has not yet filed for a listing.

Gemini is valued at $7.1 billion, according to PitchBook.

Canva

Australian design software company Canva is another name generating buzz for a possible listing this fall. “Suddenly, all eyes are on Canva, as Figma shows that there’s a real public market appetite for digital design companies that can pitch themselves as AI-related,” Bochanis says.

The firm recently announced a share sale program that would value it at $42 billion, as PitchBook reported last week.

DataBricks

DataBricks runs a cloud platform for AI applications, and it has generated a surge of investor interest as the AI industry continues to grow.

It was last valued at $62 billion, according to PitchBook data. Recent reports of a new $1 billion funding round would value the firm at more than $100 billion.