The companies that typically make up the backbone of the US initial public offering market are eyeing the Iran war for signs volatility could boil over and wreck their plans. For banks, there’s a ray of hope — that SpaceX’s potential blockbuster listing could still go ahead, and make their whole year.
After a first quarter marked by stop-and-start activity for IPOs, talk has turned to the implications of the raging conflict and the lingering effect of artificial intelligence scares. No wonder many listing candidates are sitting on their hands as a possible IPO for billionaire Elon Musk’s rocket company, which could come as soon as June and dwarf every other debut, takes shape.
“The situation in Iran has thrown a wrench into things and AI disruption has been pronounced this year,” said Evan Riley, Americas head of equity capital markets at BNP Paribas SA. “You’ve had some hiccups in terms of withdrawn deals — you’ll see the complexion of IPOs change a bit.”
“But if you have mega IPOs come then that changes the entire year because you can easily have a full year of IPO volume in one deal,” he said in an interview.
Musk’s company is expected to submit a confidential filing any day now, and is targeting a deal which could bring in as much as $75 billion, Bloomberg News has reported.
A range of industrials firms are positioned to test investor appetite for a sector seen as relatively insulated from the pressure on consumers from the war. Indoor air quality firm Madison Air Solutions Corp., which is expected to seek at least $2 billion, and drone maker Aevex Corp. both filed publicly in recent weeks for IPOs. Others are being advised by bankers to stay ready in the weeks before financial results go stale in mid-May.
Activity in April will be critical for the second quarter as bankers seek to deliver on promises that this would prove to be a banner year. US IPO volume in the first three months of 2026 marked the best first quarter since 2021, with a weighted-average drop of roughly 3% outpacing about a more than 7% decline for the benchmark S&P 500 Index, data compiled by Bloomberg show.
Still, seven of the companies behind the quarter’s 10 largest deals are trading below their IPO price, with a median decline of 28%, the data show.
The choppy performances and an uncertain backdrop have forced management teams to accept that while conditions aren’t perfect for an IPO, further waiting may not provide the clarity some are hoping for, bankers say.
“Issuers that paused a couple weeks ago may need to confront similar dynamics in early April,” said John Kolz, global head of ECM at Barclays Plc. “Do you have to take a little bit of a leap of faith and rely on a robust process to find long-term investors even with the chaos we’re dealing with?”
“Nobody should be letting perfect be the enemy of good enough,” he said in an interview. “In this environment, good enough may be the best we can hope for.”
Over the past 12 years, the second quarter has historically been the most active, Bloomberg data show.
“The forward calendar still looks constructive,” said David Bauer, head of equity capital markets at JPMorgan Chase & Co. There’s a healthy pipeline of IPOs across sectors, particularly financials, industrials and technology, he added.
Slowdown in March
Despite the optimism, volatility has already chilled a handful of planned US IPOs this year. Clear Street Group Inc. and Blackstone Inc.-backed Liftoff Mobile Inc. both paused listing plans in February just before they were due to price. The relative slowdown in March listing activity suggests the market may not get back to full strength while the conflict remains underway.
Michal Katz, head of investment and corporate banking at Mizuho Americas, said the market for IPOs will remain largely stalled amid the uncertainty.
“Once we get the two sides coming to the table and beginning to put together a framework for resolution, we should be able to get some stabilization,” Katz said.
Photo: Photographer: Alisha Jucevic/Bloomberg
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