M&A activity in the TMT sector showed a steady recovery in Q1 2025, with 2,141 closed deals over the last twelve months up from 1,887 in Q1 2024, though still below the Q1 2022 peak. Strategic buyers accounted for 91% of activity, highlighting continued consolidation in cloud, media, and telecom infrastructure. Financial sponsors also returned, pursuing growth in AI, cybersecurity, and enterprise software through flexible deal structures. Median valuation multiples continued their correction, with TEV/EBITDA at 14.20x and TEV/Revenue at 2.47x, reflecting a market recalibration toward sustainable earnings. Below, we analyze key drivers and trends shaping the sector.
Transaction volume in the TMT sector showed early signs of recovery, rising 13% YoY to 2,141 closed deals after a low point in 2024. While still below peak 2022 levels, the increase suggests cautious optimism amid persistent macroeconomic uncertainty and elevated interest rates. Valuation multiples remained under pressure, with median TEV/EBITDA declining to 14.20x and TEV/Revenue falling 9% YoY (2.47x vs. 2.74x in Q1 2024), as buyers prioritized profitability and recurring revenue over top-line growth.
Strategic Acquirers: Drove 1,911 transactions (91% of total), targeting software, AI integration, and telecom infrastructure—highlighted by IBM’s $7.7B HashiCorp and Siemens’ $10.7B Altair acquisitions.
Financial Buyers: Private equity firms participated in 191 deals (9% of total), pursuing investments in scalable platforms and enterprise software. The $8.0B Smartsheet acquisition by Vista Equity and Blackstone reflecting sustained interest in scalable, recurring revenue tech platforms.
The TMT sector gained momentum in Q1 2025, with transaction volume climbing to 2,141 deals up from 1,887 the prior year representing 15.6% of all transactions reflecting renewed investor confidence amid stabilizing economic conditions. Valuation multiples adjusted moderately, with TEV/EBITDA at 14.20x and TEV/Revenue at 2.47x, signaling continued interest in scalable, tech-enabled assets while maintaining focus on profitability and sustainable growth.
Top U.S. States: California (393 deals), New York (190), and Texas (144) led U.S. M&A activity, reinforcing their status as key TMT hubs.
Regional Trends: The Southeast, led by Florida (101 deals) and Georgia (52), saw rising M&A activity, signaling growing interest in the region. Favorable business conditions and expanding tech talent are making it an emerging TMT hub.
| Target | Buyer | Value ($mm) |
| Altair Engineering Inc. | Siemens Product Lifecycle Management Software Inc. | $10,701.00 |
| NAND SSD | SK hynix Inc. | $9,000.00 |
| Smartsheet Inc. | Vista Equity Partners Management | $7,990.00 |
| HashiCorp, Inc. | International Business Machines Corporation | $7,664.00 |
| Aspen Technology, Inc. | Emerson Electric Co. | $7,351.00 |
| Target | Buyer | Value ($mm) |
| ZT Group Intl, Inc. | Advanced Micro Devices, Inc. | $4,900.00 |
| Infinera Corporation | Nokia Oyj | $2,436.00 |
| Andrew LLC | Amphenol Corporation | $2,111.00 |
| Matterport, Inc. | CoStar Group, Inc. | $2,034.00 |
| cPaperless, LLC | Thomson Reuters Corporation | $600.00 |
| Target | Buyer | Value ($mm) |
| Zuora, Inc. | Silver Lake Technology Management | $1,410.94 |
| AppViewX, Inc. | Haveli Investment Management LLC | $44.96 |
| TechCrunch, Inc. | Regent, L.P. | n/a |
| NetWitness LLC | Partner One Capital | n/a |
| TRE Holdings, Inc. | Gemspring Capital LLC | n/a |
Source S&P Capital IQ as of 4/21/2025 and PCE Proprietary Data
Key trends shaping Tech, Media and Telecom M&A:
Opportunities: The surge in AI and ESG compliance demands is driving TMT firms to pursue acquisitions that enhance operational efficiency and meet evolving regulatory standards. Companies seek to integrate generative AI capabilities and strengthen their ESG advisory services to stay competitive in a rapidly transforming market.
Risks: Persistent wage inflation and rising labor costs are exerting pressure on TMT companies, especially those in labor-intensive segments like telecommunications infrastructure and media production.
Predicted Activity: A steady increase in private equity-driven divestitures and carve-outs is anticipated in Q2, as firms respond to high interest rates and focus on optimizing their portfolios.
Joe Anto |
Eric Zaleski |
Jon Gogolak |
Ali Masoud |
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Data Assumptions This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only. Glossary EBIT - Earnings Before Interest and Taxes Sources:
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