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AI megadeals drive tech M&A resurgence as compute and consolidation take center stage
The defining technology deals trend of 2025: AI is reshaping capital flows, business models, and infrastructure priorities all at once. Strategic acquirers are no longer simply buying into innovation. They’re repositioning entire platforms around compute capacity, data, and ecosystem reach. This shift is redefining how technology companies approach capital allocation, deal strategy, and long-term differentiation in an AI-driven market. While deal volume remains steady, total value has surged in 2025, fueled by a concentrated wave of AI influenced megadeals, escalating investment in compute infrastructure, and a reopening of public capital markets—providing liquidity for strategic buyers and reopening exit pathways for financial sponsors. Strategic buyers are racing to secure control over models, data, and infrastructure, creating a bifurcated market where AI-based solutions command premium valuations while other technology subcategories remain muted with existential questions around how AI will impact their business. Scale and scarcity are now as decisive as innovation itself––further shaped by shifting capital flows and investor priorities.
AI partnerships are blurring competitive lines. As demand for compute infrastructure outpaces supply, leading AI developers and hyperscalers are forming unconventional alliances to secure long-term access to chips, data centers, and cloud capacity. OpenAI has inked multi-pronged agreements with the largest names in tech, spanning GPU procurement, model deployment, and cloud infrastructure. Anthropic’s deepening partnerships with Amazon and Google reflect similar strategic hedging, designed to avoid over-reliance on a single provider. Meanwhile, NVIDIA collaborations with all major cloud providers, despite each competing to build their own AI stacks, underscore how the need for compute power and ecosystem reach is reshaping competitive boundaries across the tech landscape.
The infrastructure behind AI models, particularly high-density compute and power-hungry data centers, has emerged as the most critical bottleneck in the current wave of tech dealmaking. The BlackRock/MGX consortium’s $40 billion acquisition of Aligned Data Centers1 marks one of the largest private infrastructure deals in history, underscoring investor conviction that AI workloads will require massive long-term capacity. Similarly, CoreWeave’s $9 billion bid for Core Scientific, a major crypto mining firm with AI-adjacent infrastructure, reflects the convergence of previously siloed compute ecosystems. Meanwhile, Meta’s $30 billion debt issuance to finance data center expansion highlights how even the largest tech platforms are taking on leverage to compete in the AI arms race. Among the four largest hyperscalers––Amazon, Google, Microsoft, and Meta––total AI-related capex spending is expected to total over $350 billion in 2025, illustrating how access to physical infrastructure is becoming as strategically important as model development itself.
Cybersecurity continues to fuel deal activity. As generative AI broadens the attack surface and cloud adoption deepens, cybersecurity remains one of the few tech subsectors attracting sustained premium valuations. The US Department of Justice’s approval of Google’s acquisition of Wiz removes a key regulatory overhang and signals a green light for platform-led rollups in cloud security. Palo Alto Networks’ pending acquisition of CyberArk, a leader in identity and privileged access management, reflects growing demand for vertically integrated security stacks. These deals reflect a strategic push by both hyperscalers and pure-play security firms to build end-to-end defenses––especially in identity, access, and cloud workload protection––as enterprise customers seek consolidated, AI-ready platforms.
The IPO window has reopened, but with selective investor appetite. After a multi-year drought, the 2025 IPO market has shown signs of life, with companies like Pattern, Fermi, StubHub, Circle, Klarna, Figma, Navan, and Gemini all debuting in public markets. These offerings, concentrated in consumer platforms, fintech, and AI-adjacent verticals, suggest renewed investor interest, but with a more disciplined lens. Notably, many of these companies are trading below their IPO valuations, despite initial demand. This reflects a shift toward valuation realism, as investors prioritize sustainable growth and fundamentals in a higher-rate, post-zero interest rate environment.
Key M&A trends set to influence technology
Over the next six months, tech M&A will be shaped by two main forces: the competition for AI capabilities and infrastructure, and the consolidation of profitable software businesses.
AI is no longer a vertical. It’s becoming the backbone of the entire tech ecosystem––reshaping how companies operate, differentiate, and grow. Strategic buyers will keep chasing hard-to-get AI capabilities to stay ahead. Expect more tuck-ins and acquihires focused on proprietary data, scalable tooling, and specialized engineering talent. Tools like model deployment platforms and orchestration layers help companies turn AI into products faster, making them high-value targets.
Demand for AI-based solutions is high and capabilities are limited, but infrastructure has become the main bottleneck. Access to compute power and the electricity to run it is now critical, especially for hyperscalers and established tech players that want to lead. As the AI infrastructure buildout continues, companies are finding creative ways to secure resources through joint ventures, long-term leases, licensing deals, M&A, and vertical integration.
At the same time, persistent macro uncertainty and tighter capital availability are reinforcing the focus on legacy software companies' profitability, particularly those where AI threatens to do what their software already does, only faster and cheaper. Investors are favoring businesses with durable revenue models and strong unit economics over high-burn growth stories. This is fueling consolidation in vertical software, cybersecurity, and cloud infrastructure; sectors where recurring revenues, operational leverage, and AI augmentation potential remain highly attractive. Boardroom urgency is growing as tech leaders reassess product roadmaps and long-term differentiation strategies. Facing pressure to stay ahead, tech leaders are rethinking product roadmaps and moving fast on AI-first strategies—often disrupting their own offerings before the market does. For many legacy players, this shift could accelerate product overhauls, tuck-ins, and acquihires. Facing pressure to stay ahead, tech leaders are rethinking product roadmaps and moving fast on AI-first strategies—often disrupting their own offerings before the market does. For many legacy players, this shift could accelerate product overhauls, tuck-ins and acquihires.
Valuations have bounced back in many AI-related areas, but pricing discipline still matters. Buyer and seller expectations are starting to align, especially for assets with clear paths to monetization and a strong strategic fit. With capital concentrating in fewer, higher-conviction bets, valuations are increasingly favoring assets that demonstrate scale, scarcity, and integration readiness.
To win in this market, dealmakers need to be fast and focused. The priority is finding assets that strengthen AI capabilities or reinforce existing platforms, not just incremental add-ons. For private equity (PE) firms, that means revisiting platform strategies and looking for add-ons that unlock defensible intellectual property or speed up AI adoption. For strategics, M&A should connect directly to AI priorities, integration plans, and infrastructure needs. High-potential targets have flexible architectures, strong data pipelines, and reliable access to compute. As infrastructure becomes a key growth constraint, integration planning should factor in product fit, power access, latency, and deployment needs. With deal timelines shortening, firms should invest more in diligence and sharper pre-deal modeling to build confidence in a fast-moving market.
“We’re excited to see AI reshaping value creation for tech and PE firms, while IPO momentum is restoring confidence for those ready to scale with clarity and conviction.”
Alex Baker,Technology, Media and Telecommunications Deals Leader, PwC USThe bottom line: What technology dealmakers should watch in 2026
Tech M&A is entering a new phase, defined by the pursuit of AI capabilities and the infrastructure needed to support them. Strategic buyers and PE firms are targeting foundational assets, from data centers and chips to AI-native software and security platforms. While deal volume remains uneven, total value is rising as capital concentrates around high-conviction bets. Consolidation is accelerating in profitable software verticals, where AI can enhance product differentiation and margins. As public markets cautiously reopen, investor focus remains on fundamentals. Going forward, speed, focus, and integration readiness will define success in a bifurcated, AI-driven deal environment.
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Lori Driscoll
Technology, Media and Telecommunications US and Global Consulting Leader, PwC US
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