Dealogic: tech deals accounted for $421B of the $1.67T in global deals announced in the first five months of 2025, with 75% of tech M&A involving AI software
Weighed down by tariffs and geopolitical uncertainty, dealmaking has slowed to a crawl across most industries except one: the unglamorous world of data infrastructure. LinkedIn: Dawn Kopecki LinkedIn: Dawn Kopecki : Nice analysis of the hottest sector in M&A right now by Milana Vinn. — The companies that process the data used to build advanced AI models …
Context & Ripple Effects
Tech M&A had already taken the largest share of global dealmaking in 2024, after a more than 20% rise in technology deal value. The latest Dealogic figures show that technology has remained comparatively resilient even as broader dealmaking faces tariff and geopolitical pressure.
The activity is increasingly concentrated around AI software and the data infrastructure that supports it. Later coverage frames the same arc as a race to control AI-era energy, fiber, and computing capacity, extending the focus beyond software targets alone.
First-order effects
- AI software becomes the dominant category within current technology M&A, concentrating buyer attention on companies tied to AI capabilities.
- Data-infrastructure assets stand out as an active dealmaking area while transactions in many other sectors slow.
Second-order effects
- Strategic buyers and financial sponsors seeking AI exposure are likely to face more competition for software and infrastructure targets, while non-AI tech assets receive relatively less deal attention.
- The focus on data infrastructure pulls M&A interest toward the underlying systems needed to process AI data, not just application-layer software.
Third-order effects
- If the pattern persists, AI-related dealmaking may reorganize technology M&A around control of both software capabilities and the infrastructure stack that enables them.
- The concentration of activity during a broader M&A slowdown suggests AI exposure is becoming a key filter for which technology assets can attract strategic capital, though that depends on sustained demand and financing conditions.
The trend: AI is shifting technology M&A from broad sector expansion toward targeted acquisition of AI software and the infrastructure required to operate it.