Information Technology (IT) Industry

Q4 2023: Mergers and Acquisitions Trend Report

Industry Overview

• The overall global outlook for the Information Technology (IT) Industry is highly optimistic. The pandemic catapulted new technology adoption among many organizations while rapidly accelerating a worldwide digital transformation.
• The rapid acceptance of remote work, cloud computing, everything-as-a-service models, supply chain disruptions, and sustainability efforts has created an intense demand for new technological solutions and workflow optimization efforts. With many of the pandemic issues slowing, technology leaders have the opportunity to address continuing challenges more deliberately and purposefully.

Key Industry Trends

• The recent development of generative AI has significant implications when considering the future of the industry because of its seemingly limitless potential.
• Despite a general decrease in job postings across the world, the tech industry is gradually increasing its employment due to many company’s becoming more digitized. This general trend in the United States is expected to be reflected in emerging markets in the near future, implying a steep rise in demand for technology services.

Recent M&A Transactions

Historical Performance

• Over the past six years, shifting technological trends toward cloud computing, analytics, and cybersecurity have caused larger operators to acquire smaller companies and develop new products to maintain competitive positions.
• Revenues have been consistently expanding, except for a COVID-19 induced drop in 2020. The industry returned to hyper-growth in 2021, but it has slowed down as inflationary worries, cybersecurity concerns, and anti-trust lawsuits continue to mount against industry players.

Future Industry Growth

• Jumpstarted by the pandemic’s abrupt, worldwide push towards a digital-first lifestyle, 2024 and beyond is expected to show increased revenues as technology innovates, expands, and reaches new use cases.