Private equity emerges with new direction following its most testing period in decades: Global private equity report 2026

Based on insights from over 800 private equity professionals across six global regions, results show an industry transitioning from prolonged disruption into a more deliberate, strategy-led phase of value creation. In its latest edition, the firm’s dedicated private equity sector outlook highlights improving confidence in market conditions, renewed selectivity in capital deployment and the rising influence of technology, particularly artificial intelligence, on investment and operational performance.

Commenting on the latest results revealed, Partner and Head of Private Equity at Forvis Mazars Group, Matthieu Boyé said: “Globally, market conditions are entering a period of stabilisation, even as uncertainty remains. After an extended phase of constrained activity, deal-making is beginning to return, but in a more selective and disciplined form. Across private markets, there is a renewed willingness to close transactions as buyers and sellers gradually bridge valuation gaps. Technology, including AI, is supporting better decision-making, but experienced judgement remains central. As interest rates stabilise, firms are adapting their approaches and preparing for what’s next, with a more constructive environment for private equity emerging in 2026.”

Scott Linch, Managing Partner of Forvis Mazars Capital Advisors and National Sector Lead of Forvis Mazars LLP in the U.S. continued: “In the United States, private equity is moving into a phase defined less by market momentum and more by execution. While financing conditions remain tight and exits take longer, confidence in portfolio growth is holding up and firms are increasingly focused on how value is created within their existing assets. Firms that can clearly articulate how they create value and consistently deliver on that promise, are best positioned to succeed as the market continues to recalibrate.” 

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The key findings

• Investment strategies are becoming more execution focused, with firms prioritising control, operational influence and clearly defined value creation levers over scale or deal volume.
• Portfolio performance shows continuity rather than disruption, with outcomes broadly in line with last year’s survey and a modest reduction in underperformance at exit compared with 2025.
• Capital deployment is being shaped more strongly by financing conditions, with a growing impact on build-up strategies, capital structures and exit timing across regions.
• International investment remains a core driver of portfolio growth, with most firms reporting growth from both domestic and cross-border markets, and cross-border strategies being particularly important for active investors.
• Technology-led investment has moved to the forefront globally, with TMT now the most frequently targeted sector overall, reflecting the growing importance of digital capability in portfolio value creation.

Navigating selective market stabilisation

After years of macroeconomic and geopolitical turbulence, the private equity landscape is showing signs of cautious stabilisation. While financing conditions remain tight and exit timelines have lengthened, firms report stronger conviction in portfolio performance and a more constructive environment for growth.

Among the top challenges negatively impacting portfolio performance:

• 67% of private equity leaders confirm market and geopolitical uncertainty.
• 48% cite operational complexity.
• 23% state misalignment with management.

In order to tackle this, private equity firms are adapting investment strategies. Results shows that growth capital remains the dominant strategy globally, with 73% of respondents focused on growth investments, well ahead of leveraged buyouts at 49%. This reflects a continued preference for strategies that support expansion while preserving flexibility in a higher-cost capital environment.

Redefining performance and value creation

As market conditions stabilise unevenly, private equity firms are adapting strategies, capital structures and time horizons to operate effectively in a more complex demanding environment. While capital remains abundant, it’s now harder to deploy. The report identifies an ongoing imbalance between capital availability and deployable opportunities. Dry powder levels remain high, yet firms cite difficulty finding assets that meet return expectations. Competition for high quality assets is also intense and underwriting discipline is rising.

• 73% of respondents prioritise growth capital strategies, compared to 49% for leveraged buyouts.
• Financing constraints have increased, with 58% of firms reporting build‑up strategies affected, up 10 points from 2025.
• Most firms say they would have walked away from fewer than 10% of past deals, signalling both increased confidence and heightened selectivity.

Technology overtakes financial services as top investment target

Against this backdrop, strategy clarity and sector focus are becoming more important sources of differentiation. A defining shift year-on-year in the 2026 findings is the clear rise of technology:

• TMT is now the most frequently targeted sector globally (58%), just surpassing financial services (57%).
• Investors emphasise the growing importance of technology enabled capabilities to support portfolio resilience and scalable growth.
• Sector focus and specialisation are emerging as crucial differentiators in an increasingly competitive deal environment.

Operational depth and longer holding periods redefine value creation

With exits becoming more complex and valuations slower to align, private equity firms are leaning more heavily on operational levers.

Data shows:

• Portfolio performance appears weaker at year three, but improves significantly at exit, underscoring the importance of later cycle value creation.
• Extended holding periods are now structural, driven by financing constraints and stalled M&A processes.
• 69% of firms are extending fund lifecycles to manage fundraising pressures – up from 54% in 2025.
• Growth increasingly depends on international expansion, with most firms reporting value creation driven by a mix of domestic and cross-border strategies.

As markets stabilise, Forvis Mazars’ global private equity market outlook for 2026 clearly outlines the new direction being explored in investment. PE firms able to articulate a compelling investment strategy and deliver against it will be best positioned to capture value in a more selective, performance driven cycle.

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Key contacts

Matthieu Boyé, Partner and Head of Private Equity at Forvis Mazars Group 
Matthieu.Boye@mazars.fr / +33 1 49 97 66 34

Scott Linch, Managing Partner of Forvis Mazars Capital Advisors and National Sector Lead of Forvis Mazars LLP in the U.S. 
Scott.Linch@us.forvismazars.com / +1 704 367 7053 

Press contacts  

Rosa Mejia Banks, Group PR and Content Officer  
Rosa.Mejia-Banks@mazars.co.uk / +44 (0) 20 7063 4934   

Heather McMaster, Group Head of PR and Content                    
Heather.McMaster@mazars.co.uk  / +44 (0) 20 7063 4165