Business and financial services M&A update: Q4 2025

M&A activity experienced an uptick among regional banks in the fourth quarter with these deals being completed on accelerated timelines in comparison to previous similar transactions.¹

Business and financial services trends

  • Business process outsourcing
    While the broader managed services market annual contract value (ACV) generated was relatively flat in the fourth quarter, down 0.3% compared to the prior year, the BPO market ACV increased 13% to $2.2 billion.2
  • Consulting
    A more stringent job market is causing individuals who have separated from their previous positions to enter the consulting market, increasing competition and demand for firms servicing small and medium-size businesses.3
  • Education and training
    While technology adoption and AI integration have recently influenced the market, greater activity in building sustainable technology infrastructure and supervising AI content are emerging as key trends heading into 2026.4
  • Insurance, legal, and risk services
    M&A activity among insurance carriers is expected to be driven by technology-focused firms acquiring less digitally advanced targets, leveraging their technology platforms to accelerate growth rather than geographic reach.5
  • Staffing and recruiting
    The broader staffing market is anticipated to grow by 2% in 2026, reflecting a shift toward stability across the industry. This growth is in large part a product of the reshoring of engineering, industrial, and other skill-specific roles.6

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References

1 American Deposit Management, “Banking Brief: Q4 2025,” January 7, 2026..
2 ISG, “Global technology demand reaches record high in Q4, fueled by AI, ISG Index™ finds,” press release, January 15, 2026.
3 Chris Morris, “6 consulting trends to watch in 2026,” Inc., January 25, 2026.
4 Holon IQ, 2026 global education outlook, December 19, 2025.
5 West Monroe, 2026 insurance industry outlook, November 18, 2025.
6 Lauren Watts, “Smarter staffing: Trends shaping 2026,” Armada Staffing Group, December 31, 2025.

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