• Blackstone's Jonathan Gray forecasts 2026 as a pivotal year for IPOs, citing the largest pipeline since 2021.
  • The prediction is driven by moderating capital costs, rising sponsor activity, and recent successes like the $7.2 billion Medline (MDLN) IPO.
  • Blackstone's Q4 2025 earnings show strong realizations and fee growth, supporting a broader private markets rebound.

Jonathan Gray, President and COO of Blackstone Inc., stated during the firm's Q4 2025 earnings call that 2026 will be a major year for IPOs, citing a robust pipeline—the largest since 2021—driven by moderating capital costs, rising sponsor activity, and recent successes like the $7.2 billion Medline IPO, the largest sponsor-backed IPO in history with shares up over 40% on debut. This outlook comes as Blackstone, overseeing $1.275 trillion in assets under management as of late 2025, reported Q4 realizations rose 59% year-over-year to $957 million, with full-year figures up 50% to $2.1 billion, signaling a potential "deal dam" break in the market.

Efforts to capitalize on the IPO revival have gained momentum, with U.S. IPO volume increasing by 100% year-over-year in Q3 2025, according to market data. Gray highlighted that falling rates and declining cost of capital are spurring activity, with large deals valued at $1 billion or more up 95% in 2025 compared to the previous year's run-rate. "We're seeing a conducive environment for exits, particularly in sectors like AI infrastructure and energy," Gray said, paraphrasing his remarks from the call. Blackstone's portfolio data shows 77% of its CEOs increased AI software spend versus 44% for non-AI areas, underscoring thematic investment trends.

Without a sustained IPO wave, some portfolio companies might face liquidity constraints, but recent successes like Medline's debut suggest investor appetite is returning. In 2025, Blackstone deployed $138 billion—the highest in four years—including the $18 billion privatization of Hologic (HOLX), and completed eight privatizations amid a surge from $100 billion through Q3. Industry sources note that bankers are urging private equity firms to maintain IPO momentum into 2026, with experts like Gray and Blackstone's leadership describing "generational" opportunities in AI and private capital. Attempts to reach additional commentators for this article were unsuccessful, but people familiar with the matter indicate that antitrust regulatory shifts and economic stability are aiding strategics' M&A activity.

Blackstone's fee-related earnings grew 9% to $5.7 billion in 2025, with management fees up 12% to $8.0 billion, supporting what Gray termed a "virtuous cycle" of realizations and fundraising. The firm's U.S. portfolio revenue growth accelerated to 9% year-over-year in Q3 2025, with EBITDA margins expanding by over 600 basis points to 35%, reflecting strong operational performance. Looking ahead, short-term focus includes new drawdown funds entering fee-paying phases and product launches with partners like Vanguard, while long-term prospects hinge on sustained demand in AI, data centers, and power sectors, where Blackstone has $1.7 trillion in revenue exposure and $415 billion in capital expenditures.

Correction: An earlier version of this article misstated the year for Medline's IPO; it occurred in 2025, not 2024. The piece has been updated to reflect accurate timing.